15 {{ upvoteCount | shortNum }}
15 {{ upvoteCount | shortNum }}

The Enduring Enigma of Costco's $1.50 Hot Dog and Soda Combo

by Jeffery
13 replies
The Enduring Enigma of Costco's $1.50 Hot Dog and Soda Combo
Mental Floss Jake Rossen


The price hasn't changed in nearly 35 years. What kind of
sorcery is this?

Excerpt:

When Costco president W. Craig Jelinek once complained to
Costco co-founder and former CEO Jim Sinegal that their
monolithic warehouse business was losing money on their
famously cheap $1.50 hot dog and soda package, Sinegal
listened, nodded, and then did his best to make his take on the
situation perfectly clear.

"If you raise [the price of] the effing hot dog, I will kill
you," Sinegal said. "Figure it out."

~ ~ ~

The articles goes on to explain how Costco set in stone "value, good will, foot traffic," as well as how Cosco survived changing times.


The takeaway:


Create an online membership product wherein the price never increases and will create virtual foot traffic aka access to related products? Me thinks so.
#$150 #combo #costco #dog #enduring #enigma #hot #soda
Avatar of Unregistered
  • Profile picture of the author DWolfe
    Originally Posted by Jeffery View Post

    ~
    The articles goes on to explain how Costco set in stone "value, good will, foot traffic," as well as how Cosco survived changing time
    Costco uses a few loss leaders to create value and memberships.

    Another thing that provides good value is the $1.99 slice of Pizza there. " It's one of the largest pizza chains in the US
    With more than 400 locations, Costco ranks in the top 20 pizza chains in the country."
    https://www.tasteofhome.com/collecti...ted%20Parmesan.
    Now you are making us hungry
    {{ DiscussionBoard.errors[11606476].message }}
  • Profile picture of the author Princess Balestra
    As a princess, natchrlly I gotta watch for succumbin' to the allure of the bargain sausage -- speshly when it comes bundled with sumthin' to wash down your mouth aftah.


    But here is an initiative that clearly pays, despite what the immediate balance sheet may reveal.
    Signature

    Lightin' fuses is for blowin' stuff togethah.

    {{ DiscussionBoard.errors[11606482].message }}
    • Profile picture of the author Jeffery
      Originally Posted by Princess Balestra View Post

      As a princess, natchrlly I gotta watch for succumbin' to the allure of the bargain sausage -- speshly when it comes bundled with sumthin' to wash down your mouth aftah.

      But here is an initiative that clearly pays, despite what the immediate balance sheet may reveal.
      Me to Costco:

      One order of the hot dot combo, one order of the pizza and a side order of.. Princess please.
      Signature
      In the minute it took me to write this post.. someone died of Covid 19. RIP.
      {{ DiscussionBoard.errors[11606484].message }}
      • Profile picture of the author Odahh
        Originally Posted by Jeffery View Post

        Me to Costco:

        One order of the hot dot combo, one order of the pizza and a side order of.. Princess please.
        you forget the rotisserie chicken that has as much brown sugar solution injected into the meat as possible before cooking ..

        instead of putting out flyers every week and having sales and coupons for ..you back very small losses into hot food usually bought after customer have spend well over 100 dollars sometimes several hundred dollars ..
        {{ DiscussionBoard.errors[11606529].message }}
        • Profile picture of the author Jeffery
          Originally Posted by Odahh View Post

          you forget the rotisserie chicken that has as much brown sugar solution injected into the meat as possible before cooking ..

          instead of putting out flyers every week and having sales and coupons for ..you back very small losses into hot food usually bought after customer have spend well over 100 dollars sometimes several hundred dollars ..
          Reminds me of a time. back in the day, when I worked at a new grocery store in town.

          Red necks we were. We didn't know of 4-lane highways and rotisserie chickens. Unheard of in our neck of the woods.

          One day the Big Boss from the Big City visited the store and had a little meeting with us "stock boys" wherein he spoke of things like suggestive selling, customer service with a smile and on and on.

          At the end of the meeting he asked us if we had any ideas how to increase foot traffic. He was pf the thought his brand new swanky store was foreign to our small country community and they were reluctant to visit the store.

          I raised my hand and explained the fancy schmancy New York deli was serving the wrong food to red necks and that huge deli was already in the red according to the fancy schmancy Deli Mgr from NY.

          He asked me what I would do differently? Simple I relied. Knock a whole in the wall, install a pick-up windows that served people outside the store. Only sell greasy chicken and french fries inside one of those new fancy smancy food bags. There would be long lines, etc.

          He actually did exactly that with one exception.. instead of traditional oven baked chicken.. rotisserie chickens! And syrupy cola. It was a big hit. Construction workers to city hall customers lined up daily. Foot traffic increased inside the store. Many people would have their kids pick-up bags of the chicken while we lowly stock boys put on the bag boy hats.

          Jack, the owner made it right, free rotisserie chickens for the stock crew daily. The girls often said.. we were the cheapest dates in the whole county. Darn right.
          Signature
          In the minute it took me to write this post.. someone died of Covid 19. RIP.
          {{ DiscussionBoard.errors[11606792].message }}
  • Profile picture of the author klixion
    The pizza and hot dogs exceeded my expectations. I believe Costco now requires a membership to purchase at the food court.
    Signature
    Klixion - Innovative Autosurf Traffic Exchange
    {{ DiscussionBoard.errors[11606539].message }}
    • Profile picture of the author myob
      Originally Posted by klixion View Post

      The pizza and hot dogs exceeded my expectations. I believe Costco now requires a membership to purchase at the food court.
      Their pizza and hot dogs are well worth the $60 annual membership fee. For the bean counters out there, this brings the amortized cost of the hot dog combo over an average of every two weeks to $4.00. Not really such a bad return on Costco's investment of 50 cents per wiener and a few pennies worth of flavored carbonated sugar water.
      {{ DiscussionBoard.errors[11606557].message }}
  • Profile picture of the author Profit Traveler
    Banned
    And if you ever wondered what exactly is in a Hot Dog...Everything...that was left on the butchers floor.
    {{ DiscussionBoard.errors[11606597].message }}
    • Profile picture of the author writeaway
      Originally Posted by Profit Traveler View Post

      And if you ever wondered what exactly is in a Hot Dog...Everything...that was left on the butchers floor.
      Yeah, I've seen it.

      In fact, I saw so much that it convinced me to become a VEGAN for a few years
      Signature
      {{ DiscussionBoard.errors[11606791].message }}
    • Profile picture of the author dsimms
      Originally Posted by Profit Traveler View Post

      And if you ever wondered what exactly is in a Hot Dog...Everything...that was left on the butchers floor.
      If I wonder, then I might change my mind...
      I just close my eyes before I eat...
      {{ DiscussionBoard.errors[11606980].message }}
  • Profile picture of the author Jeffery
    A Costco opened in China. See the absolute chaos that ensued (2019)
    Source: CNN Business
    Video Source: YouTube

    In August 2019, local police had to step in when massive crowds overwhelmed China's first Costco store on opening day.


    https://youtu.be/2UfO4gpML4g

    Signature
    In the minute it took me to write this post.. someone died of Covid 19. RIP.
    {{ DiscussionBoard.errors[11606783].message }}
  • Profile picture of the author socialentry
    costco sells hot dogs?
    {{ DiscussionBoard.errors[11606991].message }}
  • Profile picture of the author Monetize
    I just got my Costco membership at the beginning of the
    year and so I have never been to the actual warehouse
    because of the pandemic. I've never had the hot dog
    special, but I am looking forward to it. Ordering online
    from Costco has been a lifesaver, they have lots of
    great promotions and marketers could learn a lot
    from the way that Costco does business.
    {{ DiscussionBoard.errors[11606992].message }}
Avatar of Unregistered

Trending Topics