The Advocacy HOWTO suggests the following canons of conduct when advocating Linux:
SlashDot ran an article that raised some interesting questions. In it, a DSE salesman from NewZealand (James Hutton, a local Linux user, sometimes spotted at WLUG meetings) says that people wouldn't buy Linux-based computers, partly or mostly because they couldn't understand why the software was free (let alone Free). To them, obviously the software wasn't even good enough that the author(s) thought they could sell it!
There are the obvious "freedom to tinker" style arguments that we're familiar with: http://www.gnu.org/philosophy/free-sw.html
To most people, (and to computer geeks when considering anything other than software) "you get what you pay for". Why is software different?
The majority of software is not "shrink-wrapped" commercial software. There are estimates that only around 10% of all software is written by commercial software vendors for selling off the shelf. The majority of software is written either "in-house" or for contract, for custom solutions. (Of course, if you count units installed or units sold rather than versions released, then shrink-wrapped commercial software is the majority -- StuartYeates) If software is not your core business, and it is merely a tool to help you conduct your business, then it does not affect you much if other people also have access to that software. However, you can benefit from any improvements other people make to the software.
While many developers of FreeSoftware are volunteers doing it for fun and/or recognition, there are many developers who are employed to help make the software better for their employers, and add features needed in their particular situation.
Example 1: from a recent Linux kernel changelog, you can see code contributed from a wide variety of sources such as IBM, HewlettPackard, Debian, RedHat, SUSE, many universities around the world, Telia (a large European Telecoms company), the United States military, Intel, AMD, Samba, DLink, Dell, SGI, ... and dozens of other organisations and companies around the world. These organisations wouldn't spend time and/or money on developers if it wasn't in their interests to help improve the software.
Example 2: the famous Apache software came about because lots of system administrators cooperated to improve the software. They were all trying to make the software better for their own particular purposes, and benefitted from other people's effort to do the same. Today, Apache is used on the majority of internet servers on the planet.