Coupon Site Business Model and Profits to Make

Overview of Business Model
Everyone loves to save money. That is why we are witnessing the emergence of coupon networks online, where consumers can easily visit the site, view coupons, print them, and use them in a traditional offline store. Coupon networks can be targeted at both national and regional audiences, depending on your online objectives and marketing budget.

How does it work? It’s simple. You charge businesses to advertise their coupons on your site. You then promote your site to the area that you are targeting (whether it be national or regional) and encourage your visitors to use the coupons available on your Web site. It’s as easy as that!

Skills Needed
Strong online marketing skills would be an asset to run this type of business.

Cost to Start This Business
The cost to set up and run this type of business ranges from $4,000 to $50,000. Start-up costs include computer hardware and software, a scanner, and a printer. Initially you will also have to pay for the design, development, and hosting of your Web site. You may want to develop a fully automated system where customers can have password-controlled access to forms online to input their coupons and pay for coupon placement. The development costs for the program would vary depending on the complexity. All additional costs are associated with promoting your business online and offline.

Number of Employees Needed to Start
This business can be started with one person. However, to attract lots of visitors to your site and encourage them to come back often, you will want lots of coupons on your site. Only one person does not easily accomplish this.

International Potential
Since different countries have different pricing strategies and currencies, this type of business does not have strong international potential. It is better suited for a national or regional market.

Coupons

Important Business Issues to be Addressed
Many of your coupon advertisers will provide repeat business for your coupon network if they get a good response; therefore, it is important to develop strong relationships with these advertisers and make sure a lot of their coupons are responded to. It is important to provide guidelines and tips on what makes an effective coupon. Don’t do anything that may jeopardize your relationship with these advertisers as it may hinder the chances of there doing repeat business with your organization. One bad experience can turn multiple advertisers away from doing business with your coupon network. To ensure that you avoid this problem, you should consider implementing a strategic customer relationship management system.

Many of the people accessing the site will be home users and may have dialup access. Large graphic files will take longer to download. The longer the download time, the more likely it is that the visitor will click away before the Web page is viewed. With coupons being graphic intensive, it is important that you have restrictions on acceptable file sizes to ensure quick and easy access to all pages of your site.

Online Marketing Techniques

  • Develop a comprehensive link strategy. Generate links from as many related topic-specific Web sites, local Web sites with high traffic, appropriate directories, and meta-indexes as possible.
  • Launch a strategic banner advertising campaign on Web sites frequented by your target market. These sites could include geographically targeted Web sites or industry-specific sites.
  • Develop your own personal mailing list to communicate with your site visitors. You could ask people if they would like to be notified when you update the coupons offered on your site. This is a great permission marketing technique to increase the repeat traffic to your Web site.
  • Develop a banner advertising campaign where your banners are the actual coupons from your site. These banners would be strategically placed on appropriate sites.
  • Develop a sponsored listings campaign to bid on appropriate keyword phrases with the popular search engines.
  • Develop a viral marketing strategy where people can “Send This Coupon to a Friend” via your site. This will help to spread the word about your site.

Additional Income
You might consider developing a coupon book that would be printed and sold offline. These are popular with fundraisers and would be a natural add-on for this type of business.

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