Discount cards, why is no one doing it?

[NickS]

Hi everyone, I recently took it upon myself to teach myself how to sell. I've got a part time job selling door to door and I want to improve, hone my skills and start selling stuff myself one I get the hang of it.

Anyway, I was reading Brian Tracy's "The Psychology of Selling" and one sentence got my attention, the one he says where his first sales job was selling discount cards.

He went door to door selling these cards, and if people showed it to participating restaurants, they'd get 10%-20% discounts. He charged 20 dollars for the card and they'd pay themselves back after 2 or 3 uses. Win-win-win for Brian, the customer, and the restaurant.

Why the hell is nobody doing this, and what is stopping me from starting a similar business, complete with a website and social media presence?

I feel like I'm missing some obvious reality here as to why these cards aren't everywhere...

 

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[mrarcher]

More than likely because it is easy to look up discount codes online for free. Free is a very hard price to compete with.

 

[BlakeIC]

More than likely because it is easy to look up discount codes online for free. Free is a very hard price to compete with.

I think you are confusing local businesses with online businesses

Many local B&M stores don't run online coupon codes (excluding retail giants, tech giants etc)

I can't see why this could not work, you start with your own city then slowly expand to other cities

edit: NVM

Problem is you''ll sooner or later run out of customers in the cities you go through

While it doesn't appear sustainable, it does look like a great way to bootstrap for any other ideas you possibly have

 

[juan917]

Hi everyone, I recently took it upon myself to teach myself how to sell. I've got a part time job selling door to door and I want to improve, hone my skills and start selling stuff myself one I get the hang of it.

Anyway, I was reading Brian Tracy's "The Psychology of Selling" and one sentence got my attention, the one he says where his first sales job was selling discount cards.

He went door to door selling these cards, and if people showed it to participating restaurants, they'd get 10%-20% discounts. He charged 20 dollars for the card and they'd pay themselves back after 2 or 3 uses. Win-win-win for Brian, the customer, and the restaurant.

Why the hell is nobody doing this, and what is stopping me from starting a similar business, complete with a website and social media presence?

I feel like I'm missing some obvious reality here as to why these cards aren't everywhere...

I've gotten some of these (for free though). Never used them LOL. Simply didn't care for it. Neither did any of my coworkers. Just anecdotal but might be part of the reason.

 

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[NickS]

Yep, it's not sustainable but I don't see the harm in just setting something like this up. It seems like there's very little time investment. Make a website, throw some ads on Facebook, sell the idea to restaurants, get the cards made, ship/sell them. Done.

I think I'll give it a go and see how it goes, maybe set up just a dummy website and e-mail some restaurants and see where I'm at. It would only take me two hours or so.

 

[Longinus]

I've gotten some of these (for free though). Never used them LOL. Simply didn't care for it. Neither did any of my coworkers. Just anecdotal but might be part of the reason.

Same story.

I get some, see if I can use them, and when I can use them, I always forget them.

I would never pay for discount cards though.

 

[Kung Fu Steve]

Actually these are sold all over the place.

MOSTLY for fundraisers at schools. Elementary students or maybe the local high school football team.

The business itself is pretty simple.

Schools are often marketed to by these companies who will give them 50% of the proceeds (sometimes less). They run around and convince local stores to offer a 10-30% discount with this card for a year (or even single-use coupons). They charge $20, give the school $10 and, of course, they write it offer a charitable donation.

The challenge is it's much more work than it sounds like. Usually you need a large (and dedicated) team. You have to be willing to shaft the kids a little -- and then you have to deal with the school districts... let me tell you what a joy that can be... yaaaaaaaay.

But also remember, people have taken this business model and shifted it slightly. Groupon is a good example. Heck, even Costco is kind of an example where you pay for your membership card in order to received "discounted" items.

Maybe you can come up with a unique spin on it?

 

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[The-J]

Actually these are sold all over the place.

MOSTLY for fundraisers at schools. Elementary students or maybe the local high school football team.

That's exactly what my high school did. Discounts to local businesses and local franchises, as well as some free stuff. It was worth the cost of the card, but only if you (1) lived in the immediate area, which I did not and (2) frequented the places offering the discount.

I remember one of the discounts was for a music store, which could have been a discount worth $100+. Now THAT'S worth it. The card I think was $5.

 

[NickS]

Thanks for the replies everyone.

I figured it should be possible to contact a few mid-high-end restaurants in my city, and convince them to go through with this plan. They could only offer discounts during slow hours for example, because a discounted table is better than an empty table.

Once I have a few participating restaurants, I don't see why the cards won't sell themselves?

For example what would I need a large and dedicated team for?

 

[Kung Fu Steve]

Thanks for the replies everyone.

I figured it should be possible to contact a few mid-high-end restaurants in my city, and convince them to go through with this plan. They could only offer discounts during slow hours for example, because a discounted table is better than an empty table.

Once I have a few participating restaurants, I don't see why the cards won't sell themselves?

For example what would I need a large and dedicated team for?

You're missing a key point.

Most of the cards are sold with a pitch of "the poor children need a new football -- if you don't buy it you're not supporting local children"

Or "if you don't buy this you don't support education... slime..."

The sales pitch is the guilt. I haven't seen this DIRECT business model work anywhere other than being attached to some local "charitable event" -- would love to be proven wrong though!

 

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[GIlman]

Agree with Steve above. Damn twice in one week.

A big part of it is that the world has changed since he was a boy. Back then there was no internet, groupon, few if any daily massed mailed coupons, etc. it was a great deal and sold itself because of scarcity. That scarcity does not exist today. The coupon had value because people didn't have great access to them like today.

Now the only model that probably is going to work is the guilt pitch. I've bought 1/2 dozen of these over the last decade. I don't think I've used one.

This market to me seems very high friction.

But, to me, I look at this and see it different. If kids are using a guilt pitch to sell something presumably few people want...can you figure out a way to cut the middle man out and create a better system for donations where a majority of the profits stay with the kids.

Can you form a message around this, donate without having to buy crap u don't want. Maybe skim %15 for administration, etc.

To me this is the greater opportunity if you can solve it.


Sent from my iPhone 7 using Tapatalk

 

[Kung Fu Steve]

Agree with Steve above. Damn twice in one week.

Careful. Those kind of results lead to reinforcing the belief and soon it will become habit.

 

[MJ DeMarco]

This is the company that's been doing this for years...

https://www.entertainment.com/

https://cms.entertainment.com/about-us

 

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[NickS]

This is the company that's been doing this for years...

https://www.entertainment.com/

https://cms.entertainment.com/about-us

That's cool, I didn't even know about them. Seems like they started with one niche and branched out and now offer coupons on everything.

Still, I might just set up a website and contact a few restaurants. Nothing to lose right?

It seems everyone of you is very acquainted with this business model. Maybe it's an American thing, because over here in Europe the concept was very new to me, which makes me optimistic.

 

[Kyle O]

http://www.restaurant.com

 

[Jeremy Groover]

There is a card like this that local High School sport teams and clubs as well as the younger clubs like Boy Scouts sell. I think what the issue with doing this is, is why would the company discount there rates for a small number. You have to think big with this. The company will want royalties or at least a select "large" number of cards being produced to make it worth there while. This will work like a coupon. Coupons from a producer stand point is not to help the customer, its a reminder to by there products and to give you a little more of a push to get them in the customers hands. The coupon or the discount card in this case needs to be distributed to the masses so the company can in turn make more quick nickles and to get more people in the door in large quantities.

 

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[Longinus]

There's an organisation in my country that offers a guide for (fresh) students. They could read about the bars in every student town, where to eat, where to go if they have problems and stuff like that. That guide included a ton of discount cards as well.

Pack your discount cards with some value, I'm sure that can work.