How do coupon books like Entertainment work?

Mic B: How do coupon books like Entertainment work?
I see these books for sale by schools as fundraisers. I’m wondering how does the Entertainment company make it’s money.Do companies pay to get their coupon in the book? Does all the revenue come from the sale of the book? Or both?

I’m planning on doing something similar for my organization, but I don’t know if I should charge businesses a fee to offer coupons in my book.

Answers and Views:

Answer by Michael L
It works the same way newspaper advertising works. Both parties, the advertisers and the readers pay. The advertisers pay the lions share of newspaper production, the 25 or 50 cents you pay for your daily newspaper would not keep them in business very long. Your book should work the same way.

Businesses pay to have their business advertised in the book. The coupon is what is called a “loss leader”. The business will take a loss on the initial transaction (discount associated with the coupon) in hopes of generating new business (in hopes that the new customers will come back a 2nd and 3rd time).

The cost to the consumer is nominal and covers the a small portion of the production and delivery costs. The enticement of the sale is that for only $ 40 you can receive coupons worth $ 2000. (or something like that)

The big question you need to answer is what to charge the businesses that will advertise in your book. You need to know your coverage area, how many books you’re planning on producing and selling, production and delivery costs, and how much profit you are looking to make for your organization.

You might want to find out what ad space costs in your local newspaper so you can give a comparison to prospective advertisers. Show them the value of a book that local consumers will keep for an entire year versus a newspaper ad that will run once a week for 4 weeks and be used for wrapping fish.