Track 2 · Zero Cost Marketing Playbook
ZCM-201 · Why Rewards Beat Discounts
This lesson explains why using IGO Rewards instead of straight discounts protects your margins, brings people back for extra visits, and lets Webigo behave like a zero cost marketing engine instead of another coupon program.
Lesson overview
By the end of this module you should understand:
- Why discounting quietly eats your profit.
- How IGO Rewards are priced at retail but only cost you at cost-of-goods.
- How members earn and cash out IGO Bucks through PayPal.
- How this turns Webigo into a performance-only marketing system.
Where this fits in Track 2
ZCM-201 is the "money logic" behind Webigo. Once this makes sense, designing offers in ZCM-202 and Tariff Relief campaigns in ZCM-203 becomes much easier.
1. Why traditional discounts quietly destroy your margin
Most local businesses have been trained to think: "If I knock 10% or 20% off, I will get more people in the door." The problem is that a discount usually:
- Reduces your revenue immediately on the current visit.
- Trains customers to wait for "a deal" instead of paying normal price.
- Does not guarantee they will ever come back a second time.
A simple restaurant example
Imagine a 20% off coupon on a $50 ticket:
- Normal ticket: $50
- 20% discount: $10 off
- Customer pays: $40
You have just given away $10 of revenue today, whether they come back or not. If your food cost is 30%, you did not change your cost-of-goods at all, you only reduced what you collected.
And what did you buy with that $10?
In a traditional coupon world, that $10 "buys" you one visit:
- No guarantee of a second visit.
- No built-in reason to stay loyal.
- No automatic way to follow up with that customer.
This is why we push rewards instead of raw discounts inside Webigo.
2. How IGO Rewards and IGO Bucks work differently
Webigo uses IGO Rewards (also called IGO Bucks) instead of one-time discounts. The key idea is:
You price your offers at full retail, but the "reward" side is structured so your real cost only happens at cost-of-goods, and usually on a future visit.
Retail vs cost-of-goods (COG) with IGO Rewards
- To the member, an offer looks and feels like real money: "Get $10 in IGO Rewards toward your next visit."
- To you, that $10 is not a full $10 loss. It only costs you your cost-of-goods when redeemed (for example, food cost or service cost).
- You are not cutting today's ticket; you are funding a future visit.
When is the cost real for the business?
The reward becomes a real cost only when:
- The member returns for another visit, and
- Actually redeems their IGO Bucks toward a purchase.
That means every dollar of reward is tied to real behavior: extra visits, additional spending, and long-term loyalty.
How members earn and cash out IGO Bucks
1. Earning IGO Bucks
Members earn IGO Rewards by joining through a QR code or link, redeeming Webigo offers at participating businesses, visiting other partners, supporting local causes or school programs, and making cash back style purchases.
2. Accumulating a balance
All of those activities add to their IGO Bucks balance inside Webigo. They can see their current total, what they earned it from, and how much is available to spend or cash out.
3. Cashing out via PayPal
Once a member reaches the base amount in their account, they can request a payout. Webigo sends IGO Bucks out as real money, typically through PayPal, so the member is not stuck with points they can never use.
For the business owner, this means your reward budget is only spent when a real member does something you wanted them to do and reaches meaningful activity.
First purchase rewards and next-visit rewards
Here is a common pattern that works well:
- A new member joins Webigo and picks a plan (for example, Silver at 29.95 per year or Gold at 49.95 per year).
- They are told they can get up to a large bonus (for example, up to 200.00 in IGO Rewards) to use at local participating businesses.
- If they join through your QR code, you might set: 10.00 in IGO Rewards toward their first purchase and another 10.00 reward for their next visit.
Those first-visit and second-visit rewards are simply drawn from their larger sign-up bonus. If their plan includes 200.00 in IGO Rewards, and you fund 20.00 across their first two visits, they still have 180.00 left to discover other offers over the year.
3. Numbers comparison: discount vs IGO Rewards
Let us look at the same 50.00 example and compare a simple discount with an IGO Rewards approach.
Scenario A: 20% discount coupon
- Ticket: 50.00
- 20% off: 10.00 discount today
- Customer pays: 40.00
- Food or service cost (30%): about 15.00
You collected 40.00, spent about 15.00 on cost-of-goods, and gave away 10.00 in margin immediately. You have no built-in obligation for the customer to ever come back.
Scenario B: Full price plus IGO Rewards
- Ticket: 50.00 (no discount today)
- Customer pays: 50.00
- Food or service cost (30%): about 15.00
- You grant 10.00 in IGO Rewards toward their next visit
Today, your margin is intact. The 10.00 IGO Reward is only a cost if they come back and use it. Even then, your real cost is tied to your cost-of-goods, not pure revenue.
In other words: with IGO Rewards you are funding loyalty and repeat visits, not simply discounting the one visit they already decided to make.
Why this matters to your bottom line
- Rewards are always attached to specific behavior: joining, visiting, redeeming, trying a new location, or supporting a local cause.
- Webigo never forces you into an endless cycle of deeper discounts. Instead, you are moving part of your ad budget into trackable IGO Rewards that your customers actually value.
- IGO Bucks are paid out to consumers when they reach a base amount, typically through PayPal, so everyone sees it as real money, not confusing points.
Once you are comfortable with this logic, Track 2 will walk you through designing your first Webigo offer, creating Tariff Relief style promotions, and choosing examples that fit your exact type of business.