Winning Over Customers ---025

For our Costco shoppers, there is nothing better than finishing the shopping experience with a $1.50 hotdog or the classic $5 rotisserie chicken. In fact, we have been paying the same prices for the same food court items for almost 40 years! How is this possible? Doesn’t Costco lose profits from selling these hot dogs?

The answer is yes, and no. Costco is determined to keep selling at the same prices, despite making little to no profit. More often than not, any other business would raise the prices and turn the food court into a money-making machine due to its popularity. Even with a small price increase, it wouldn’t be enough to drive away customers, since it is still a bargain. On the other hand, having their hot dogs for the low price of $1.50 is the key to driving more foots into their store. It keeps the customers happy. Walking in for a hot dog can also lead to events such as spur of the moment or potential purchases from enticing deals. With more traffic, the losses from the food items become overshadowed.

Costco’s strategy to keep their customers happy allows them to win over many. To go above and beyond to satisfy their customers might be the secret to opening new doors. As a Costco shopper myself, I find it hard to look for a $1.50 lunch anywhere else. Sometimes, I even try to find an excuse to go to Costco just for the food! Occasionally, I will walk out with more than just a hot dog. Here at Linkstyle, we try to maintain our prices and keep it affordable, while improving our service. There are many ways to do business, and sometimes even losses can create opportunities

Leave a comment