Anyone who has ever been to a costco nasdaq cost

This preview shows page 5 - 6 out of 12 pages.

Anyone who has ever been to a Costco (NASDAQ: COST) warehouse knows Kirkland Signature, the "house brand" first introduced in 1995 and named after original company HQ in Kirkland, Washington. What is hard to believe is that Kirkland Signature has built its success by violating every rule of consumer packaged goods marketing dreamed up by a starry-eyed MBA or classic brand manager. Not only is consumer segmentation out -- no need for different Tide, Cheer, Gain, Era, Dreft, and Ivory Snow detergents -- there's no need even for different brands for different products like Duracell, Pringles, Vicks, Pampers, Clairol, etc. House brands are of course nothing new. Every grocery store markets its own brand that purports to be "as good as the leading brand." But Kirkland Signature doesn't strive for parity, it demands superiority. Here's Costco's own explanation of what it takes to be worthy of the Kirkland Signature imprimatur. Or take the case of Kirkland Signature canned tuna fish, it not only costs more and is of higher quality than the national brand Bumble Bee, it is actually made by Bumble Bee to compete with their own, inferior national brand! Kirkland Signature paper towels and toilet paper are two of Costco's all time best selling products (that's why they're always located in the farthest reaches of the warehouse, of course), and they consistently perform better than their national counterparts. Costco does not use product brands to distinguish luxury Kirkland Signature products from the merely high quality. No Lexus, Toyota and Scion product lines for different types of customers. Nor are there even tiers of Kirkland Signature: no Kirkland Signature Ultra, Premium or Select. No Black, Platinum, Gold, Green, Red, and Blue Cards. The Kirkland Signature brand is a branded house of one.
Image of page 5

Subscribe to view the full document.

The vast warehouse landscape that is Costco knows how suck you in and how to maximize the amount of goods you purchase on each visit. It’s what makes Costco so successful — a tried and true design focused on simplicity. A carefully orchestrated layout, simplified offers and the perfect amount of temptation combine to make Costco one of the most successful retailers in the United States. The designer of many of Costco’s 648 stores, Stan Laegreid, a senior principal with MulvannyG2 Architecture, laid out just why Costco is so successful in an article with Fast Company. Laegreid likens Costco’s layout to a racetrack with a carefully choreographed dance that will lead customers past all of the warehouse’s more than 3,000 products. The store employs low-profile shelves to allow consumers to see the expansive offerings across the store, making the three-acre warehouse seem less overwhelming. The outside of the store is rimmed with floor-to-ceiling shelves of goods, while the inside showcases home, seasonal, and lifestyle products. Fresh offerings can always be found at the far end.
Image of page 6
You've reached the end of this preview.
  • Spring '18
  • ONWUNAKA

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern