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Hot Business Trend: The Deal Of The Day Model

 

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by David Garland in David's Blog

(Disclosure: This post is sponsored by Hot Sauce. However, all opinions, thoughts, takeaways…and well everything comes from me.)

One of the hottest business models out there is the “Deal Of The Day” where people can basically buy stuff at insanely low prices (coupons, products, etc).

A lot of people have come to the plate on this one and some have swung and missed. Others have hit singles and doubles. And a few have smashed it out of the park.

Some of the home run hitters include Woot & Groupon (which was recently valued at 1.2 billion dollars…that is a few pennies).

But, what if you could provide local brand recognition that consumers and discounts and their favorite retailers? Enter a new emerging home run slugger: Hot Sauce (right here in exotic St. Louis, Missouri).

The concept behind Hot Sauce is simple.

From the consumer perspective:

1. You sign up via email (called Daily Alarms) or visit the website.

2. You will find insanely good deals on local restaurants in St. Louis (often up to 55% off).

3. You buy the deal you want and are issued a certificate (good for six months).

4. You go eat and feel good (10% goes to a local charity).

A closer look at the business and business model reveals one of those coveted win-win-win situations. And my guess is they are going to be VERY successful. Here is why:

Good People: As we all know, the right partners is key. First of all the folks behind it know what they are doing. The partners in this venture are Sauce Magazine/Allyson Mace, Scott Anderson (PR guy and health care exec), Brendan Marsden (owner of Modesto) and a mentor of mine Norty Cohen who is a serial entrepreneur and Founder & CEO of Moosylvania.

Innovative Media Partner With Local Ties: The tie-in with Sauce Magazine is freaking brilliant. Why? Because Sauce Magazine already has local diners trust and attention. They have a print magazine, digital efforts and a big email list. Hot Sauce offers them an incredible opportunity to do something innovative and extend the brand. Plus, Hot Sauce gets a rocket boost of credibility.

Easy Business Model: Simplicity here is key. Restaurants make more with Hot Sauce then they do with Groupon. Hot Sauce simply charges a flat fee for every coupon (not % based). And, as mentioned 10% goes to charity. So, if you are a local restaurant in St. Louis, there is a a trust factor of using a deal company with local ties AND the fact they will make more money.

Takeaways & Lessons For Your Business:

1. Importance Of Scarcity & Time Limit: Each deal is limited. It isn’t a “buy whenever you feel like it” but instead there are only a certain number available AND a time frame to buy it in (with a countdown clock in fact). Scarcity and a time limit simply create more sales because of the sense of urgency. Nobody likes missing something they want.

How can you apply scarcity and a time limit in your business?

2. Key Marketing Partners: The charity component is huge. Not only is it the right thing to do, but also increases awareness of both the charity and Hot Sauce. If you owned a non-profit and knew 10% of certain deals were going to you, you would promote the heck out of it wouldn’t you? Everyone wins. Plus, Sauce Magazine gets to offer something new and unique to their readers. Fantastic.

Who can you partner with to help grow everyone’s business?

3. Simplicity. The best ideas are often the simplest.

How can you become even simpler?

The “deal of the day” model is just heating up with incredible opportunities in a variety of niches and variations.

What do you think? Will Hot Sauce continue to be a success? What do you think of the “Deal Of The Day” business model?

 

GET MY FREE CHEAT SHEET

These are the EXACT same steps I used to go from $0 to over $1,000,000 in online course sales in less than 24 months (and used by over 2,500+ of my students)

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