Thursday, December 21, 2023

Costco is Golden in Consumers Eyes


Living in the Pacific Northwest is one of the rewards of life. Being introduced to Costco years ago was an adventure of fresh food discovery and much more according to the team at Tacoma, WA based Foodservice Solutions®. 

Now for those of you who might not know Costco is in food industry speak, considered a ‘mass retailer’ selling large quantities for less.  Here is want is important about the ‘mass retailer’ sector; during November 2023, “Mass retailers surpassed Supermarkets to become the primary retail format that most household relied on for their grocery purchases during the month whether online or in-store.  That was a quote from our friend David Bishop, of Bricks Meets Click.

Regular readers of this blog understand that Gen Z and Millennials both seek discovery when shopping for food, meals, menu, or simply dinner.  That discovery includes both Ready-2-Eat and Heat-N-Eat fresh prepared meals and more.  They were conditioned for this experience at and early age as their parents more likely than not took them to McDonalds. 

How so? Simple consider that the “Happy Meal” was one of the first mix and match bundled grocerant offerings within the food industry.  Inside that ‘happy meal’ was a tory, a book, a gift.  Ah discovery! Excitement, educational, positive, and brand reinforcing according to our Grocerant Guru® Steven Johnson.   

Now those Gen Z and Millennials are growing up and like so many of us find comfort in continuity is our daily life. The team at Foodservice Solutions® believes that Costco is one of the best companies in the U.S. to understand that while leveraging it edify its base.  Now if you are wondering why we say the consumer think Costco is golden, get a load of this!

Costco is selling gold! Costco sold more than $100 million worth of gold bars during its first quarter. Costco Wholesale Corp. wowed analysts during its quarterly earnings call with the announcement that it sold more than $100 million worth of gold bars during its first quarter, ending Nov. 26.

In case you did not know, they started selling 1-ounce gold PAMP Suisse Lady Fortuna Veriscan bars to its members back in September. The gold bars were listed at a price of $2,069.99 an ounce on Dec. 15 on the Costco website. As reported by CNBC, the bars have been so successful that they typically sell out within a few hours after they’re uploaded to Costco’s website. Customers are limited to two bars per membership.

CNBC reported back in September that selling the precious metal is an effective promotion for Costco, one that could appeal to a certain sector of Costco’s shopping clientele. Jonathan Rose, co-founder of Genesis Gold Group, noted that the warehouse club seems to have accelerated its offerings of dried foods and other survivalist goods at a time when worries about the future are running high. For example, the company markets a 150-serving emergency food preparedness kit. Gold meshes with that type of product.

“They’ve done their market research. I think it’s a very clever way to get their name in the news and have some great publicity,” said Rose. “There is definitely a crossover of people living off the land, being self-sufficient, believing in your own currency. That’s the appeal [of] gold as a safe haven as people lose faith in the U.S. dollar.”

Now then, gold bars weren’t the only “wow” items discussed during the Q1 earnings call. “We sold a Babe Ruth autographed index card for $20,000,” noted Galanti, adding that there's a Mickey Mantle autographed 1951 rookie card in nearly perfect condition for last-minute holiday shoppers – available online for $250,000.  Now let me ask, what are you bundling, selling, with discovery for your customers?

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