Costco’s Secrets to Soulful and Authentic Marketing Success
This Week’s Soulful Marketing eNewsletter Highlights:
Core Article: Costco’s Secrets to Soulful And Authentic Marketing Success
Cool Stuff: You can now create your own digital bookshelf…
AI Info & Resources: If you’re frustrated with finding writing ideas – this tool will help.
(The best part is that it’s free.)
Have you ever driven to Costco, and as soon as you get into the parking lot, depending upon the time of day you arrive, it can be swarming with tons of cars and not a whole lot of parking?
Then once you park, you have to snag a cart and flash your member card to get inside. The place is massive, shelves stacked with every kind of goods you can imagine to the welcoming scent of freshly baked bread that seems to float over from the bakery section.
Take a deep breath with me. Can you smell that? It’s a mix of everything from electronics to cleaning supplies to the savory roast chickens spinning in their rotisseries. Makes you a bit hungry, doesn’t it?
As you push the cart (the one with the slightly squeaky wheel) down the wide aisles, you feel like an adventurer here in the land of bulk. Maybe you will try a sample or two, letting the flavors burst on your tongue. It’s then you realize it’s not just shopping; it’s an experience, right?
Are you one of those people who love Costco, or not so much?
find myself somewhere in between. Despite my mixed feelings, there’s no denying Costco’s remarkable success. So, I thought it might be useful—and quite interesting—to dive into some insights about this retail giant.
Whether you’re looking to boost your own business or just satisfy your curiosity about Costco’s inner workings, there’s plenty to explore.
In case you didn’t know, Costco is a multibillion-dollar global retailer with warehouse clubs in eight countries. I know, right?! Crazy numbers.
So, how has Costco been able to grow its business?
A little history: The company started in 1976 under the name Price Club in a converted airplane hangar in San Diego. It started out just selling to small businesses.
Then, the company realized it could achieve more buying clout by also serving a selected audience of non-business members. When they changed who they were serving, the company took off and hasn’t looked back.
That’s when they created a new name—Costco—in 1983 and opened its first warehouse in Seattle, WA. It became the first company ever to grow from zero to $3 billion in less than six years. Then, in 1993, Price Club and Costo merged. (A little-known fact: The Kirkland brand’s name came from Kirkland, WA.) Pretty wild growth.
What I love about this company is their mission and dedication to what they do:
- Commitment to Quality & Customer Experience – They only carry 4,000 SKUs (Stock Keeping Units) compared to the typical 30k at most supermarkets. And they don’t stock items. They curate them. Each product is chosen with a sharp eye for quality, price, brand, and features that are of the best value to its members. They are constantly pushing to surpass member expectations and redefine the shopping experience.
As a business owner, how can you curate your business to give your customers more quality and a better experience? - Losing Money on this One Item to Attract Customers: One of Costco’s most popular items in the store is its Rotisserie chicken. And yep, you guessed it, they lose money on it. The price is only $4.95, and it’s been that price for years and won’t change. The more fascinating question is – WHY?
They sell it at a loss to draw customers into the store, and it is a terrific example of giving value and getting more customers in the door at the same time. In your business, being generous with your offers, often giving more value than expected, will help build trust and long-term relationships. So, what can you do in your business like this to give more value and build trust that will help you attract and retain customers?
Some other popular items In addition to their rotisserie chicken, Kirkland brand toilet paper, (It sells a billion rolls every year, bringing in over $400 million dollars in revenue!) Kirkland smoked thick-cut smoked bacon, gift cards, and more.
- Unwavering Commitment to Their Employees – Known for offering fair wages and exceptional benefits, Costco isn’t just creating jobs but cultivating a workplace culture that attracts the best: positive, energetic, and talented individuals who contribute to the company’s upbeat and productive environment. (This also enhances the member experience.)
Some other wildly popular items in addition to their rotisserie chicken are: Kirkland smoked bacon, hot dogs, gas, and gift cards.
Some other interesting and fun facts:
- Their biggest store is in Salt Lake City, UT (235k square feet.)
- Did you know that their hot dog prices of $1.50 and soda haven’t changed since 1984?
- The smallest store is in Juno, Alaska.
- Membership fees is where they make their money. They don’t rely on product sales margins, which is part of their core mission, prioritizing long-term relationships over short-term gains.
- States that don’t have a Costco due to population density and ruthlessness about who’s not their customer: West Virginia, Maine, Rhode Island, and Wyoming. This is a terrific example of how you don’t want to be all things to all people. Choose a niche in which you want to make the most significant impact.
The best lesson from Costco that aligns with my core values is the importance of always putting your customers first and taking good care of them so they want to keep coming back.
What’s your takeaway from Costco’s business?
Quick Update:
It’s the middle of May – how in the heck did that happen?
Summers screaming on in a little early here – today’s high is 100 degrees – it’s a skorcher. I hope wherever you are you’re having an amazing day.
Paragraph I’m Pondering:
“But that kind of attention is the prize. To be engrossed by something outside ourselves is a powerful antidote for the rational mind, the mind that so frequently has its head up its own ass—seeing things in such a narrow and darkly narcissistic way that it presents a colo-rectal theology, offering hope to no one.” ~ Anne Lamott, Bird By Bird: Some Instructions on Writing and Life
Powerful Affirmations to Inspire:
“Every night, I affirm my power and purpose. I attract prosperity and am an inspiration to entrepreneurs worldwide. I am a force for positive change and abundant success.”
Book Review:
The Culting of BrandsTurn Your Customers Into True Believers by Douglas Atkins
Cool Stuff
- Amazon’s getting more creative with their ads —Their new ad-supported channel on Prime Video, Fire TV, and Freevee showcases its “shop the show” tech, allowing viewers to buy stuff they see on their TVs with their phones. Hmmm.
- Interesting stats—It looks like VR has not taken off with US teens. To date, only 33% have access to a VR device, per a Piper Sandler survey. And yet, 56% of those say they rarely use it. Teens are still among the highest users of video games. Yet, maybe they just don’t like strapping a headset to their noggins to play a video game. (And in my case, I’d get so nauseous, eeek, don’t think that’s for me!)
- Create your own digital bookshelf. Not sure I want to replace my book review blog with this — yet if you’re starting from scratch – it might be kind of cool.
AI Info & Resources:
- Chat GPT announces its latest model – GPT 4o. This new flagship model can reason across audio, visionl, and text in real-time.
- If you’re frustrated with coming up with writing ideas for social media, emails, and more — check out this cool free tool.
- Open AI is releasing a ChatGPT app for Mac first. See you, Windows. You gotta wait your turn.
Weekly Photos:
- Yeah, Emma’s such a natural poser. I laugh sometimes at how she just sits there like a person.
- Yep, here’s a heartrock for you. It looks a little worn and not perfect. Kind of like you and me, and maybe we’ve been around the block more than a few times, and definitely not perfect. Yet, that doesn’t stop us from trying to make a difference. 🙂
- Oh wow, Mt. Shasta last Saturday morning from the hospital where Alice works. It was such a pretty morning. It won’t be long before all that snow melts.
- Emma is snoozing on top of my copy of Bird by Bird by Anne Lamott. This book is such an inspiring one for writers. I attended a workshop of hers and was inspired to pick it up and read it again.
- Emma and I are getting some time on the deck before we start our day.
- Love this hiking path, the trees give such wonderful shade, and everything is still so green.
- Early morning sunrise. The clouds look like big feathers across the sky…
