Ad-Supported Napkins

Posted on December 14, 2007
Filed Under Business & Entrepreneurship, Ideas |

Giving away things for free has proven to be a profitable business, when the ‘free stuff’ is supported by ads.  A couple of days ago I stumbled upon a great new business startup that capitalizes on this idea.

Napads.com gives away free napkins to its approved list of high profile bars, lounges and nightblubs.  The napkins are ‘free’ because they are plastered with high quality advertisements from liquor companies, movie studios and credit cards vendors.  The bars and nighclubs win because they don’t have to pay for napkins anymore, the advertisers win because they get to increase their brand awareness by getting in front of consumers while they play.  And, of course, Nap Ads wins since it is the transaction broker in the deal.

This business model first took hold online, by giving away high quality content for free and then selling relevant advertising.  Google certainly made progress in this arena, but the popularity of Adsense is beginning to fade.  The ads are boring and often times are poorly targeted.  The algorithm needs work. 

However, despite the nature and maturity of internet marketing, the same ad-supported ‘free stuff’ business model holds a tremendous amount of opportunity in the real world.  And Ad Supported Napkins is a wonderful demonstration of this. 

Right now the company is only operating in Manhattan, NY in a select list of bars, but this idea would work in almost any major city.  The 18-35 year old demographic is exactly who the big liquor companies are targeting, and they are located all over the world.  I think it would be fun to take this idea one step further and bring in local companies to advertise, which would be much more effective than direct mailings and flyers.  In fact, I think this idea would be a perfect fit for the Capitalism Cafe, where the lunch still isn’t free, but the napkins are!

Low operating costs, high margins and win-win.  The possibilities are endless.

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