L.A. Firm Hopes to Lure Online Shoppers With 95-Cent Dollars

The joke about money-losing e-commerce companies is that they are building up revenues by selling $1 for 95 cents.

But that’s exactly what a Los Angeles company started by three UCLA students plans to do. DollarDiscounter.com will charge only 95 cents for virtual dollars that can be spent at shopping sites like Amazon.com, CDNow and EToys, said Jay Chernikoff, the UCLA junior who came up with the idea.

Shoppers would start out at https://www.dollardiscounter.com and then link to more than 100 other sites. When a customer is ready to buy something, DollarDiscounter.com would make the purchase and then resell the item to the customer at a 5% discount. The company plans to make up the difference by selling ads and collecting commissions from referring shoppers to other sites, Chernikoff said.

“The idea sort of came to me and I thought, ‘I wonder if that would work?’ ” he said. “I got my team of people together and as we thought about it more, it seemed like a more and more viable idea.”

Chernikoff said it will take until November to perfect the technology necessary to offer the discounted dollars.

Though the idea is unconventional, it’s no less sound than most of the other ideas being incorporated into Internet start-ups, said Lorne Olfman, an e-commerce expert and director of the School of Information Sciences at Claremont Graduate University. “It’s no crazier than giving away free Internet access,” he said.