October 13, 2006
Kiplinger – Editor’s Query: For consumers, what are the best strategies for luxury goods shopping in warehouse clubs?
By Jane Clark, associate editor, Kiplinger’s Personal Finance magazine
(www.kiplinger.com)
As part of its mission to provide personal finance advice to its readership, Kiplinger’s Personal Finance is investigating the subject of luxury goods
shopping in the warehouse club environment, and looking to the RetailWire community and BrainTrust panel for professional insights.
Our inquiry is focusing on three areas that concern club shoppers, increasingly drawn to the channel for high-end item purchases:
PRICES:
Warehouse clubs rely on the so-called treasure hunt concept: Shoppers expect to get great, one-time-only deals on everything from bathrobes to hot tubs. But these deals don’t necessarily apply across the board, and the selective, rapidly changing inventory makes comparison shopping difficult.
Meanwhile, most other stores offer sales and discounts, rendering the term “suggested retail price” increasingly meaningless. Do warehouse clubs really offer significantly better prices on higher-end items — say, diamonds, flat-screen TVs and digital cameras? Should consumers price compare among different clubs, or are prices fairly consistent across the channel?
EXPERIENCE:
You can’t try things on, ask questions, compare prices or even know that the item will be there on your next visit. You give up the luxurious atmosphere and the expertise offered by high-end retailers like Tiffany’s and Talbot’s — a significant negative when it comes to a big-ticket, emotion-fraught purchase like a diamond ring.
On the plus side, warehouse clubs offer the thrill of the hunt, a sense of discovery and excitement, and even a carnival-like atmosphere. Do the pluses outweigh negatives, especially when it comes to buying luxury items? Which clubs do the best job of playing to their strengths and minimizing their weaknesses?
SELECTION:
Costco prides itself on offering quality over quantity; typically, it stocks about 4,000 units per warehouse, compared with 40,000 to 60,000 units at discount retailers and supermarkets. By design, it carries fewer brands per category than other large specialty stores, like Best Buy or Circuit City, or dedicated sites like Blue Nile. Do warehouse club shoppers miss out on value when they forgo the selection offered by those other stores?
Discussion Question: In the areas of price, experience and selection, as detailed above, what are the best strategies for consumers shopping for luxury
goods in warehouse clubs?
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My knowledge base extends only to electronics, but I think in many ways a lot of these comments are based on the “perception” of what the clubs do, not the reality.
I am always amused at this “treasure hunt” concept. In categories with consistent demand, like PCs , cameras or TVs, Costco (the club I shop most often) always has the “right” selection of products at below the competitor’s price for that item. So while it might not have every brand or every model and every brand may not be represented in every product segment, Costco always has a selection of HiDef 42″ plasmas, for example, an “off” brand, and 1 or 2 major brands. When those skus are sold out they may replace it with the same item or something different, dependent on availability but they will always cover certain price points and feature sets. I just don’t see how a treasure hunt fits in here.
The other comment is on discontinued goods. In electronics the clubs now get first quality current products as soon as they show up in traditional stores. The electronics industry moves too fast for anyone to build a business selling EOL product. No one wants goods like that and selling them at low cost is not a perceived bargain.
For some consumers, the treasure hunt shopping experience is as enjoyable and intense as an auction, which many times do not achieve their expectations. For truly knowledgeable consumers, a great buy is achievable by club purchases. Clubs are offered exceptional deals on discontinued, soon to be discontinued and less successful current items. These may be items without all the latest features, which for many consumers is just what they want. Only an educated consumer will be able to make a great decision. Comparison among club operators is of little value. Due to the limited number of items offered for sale there are very few items for direct comparison. The comparison is between club and specialty stores to determine value.
Club shopping is not for every consumer. Clubs do provide customers with good value and significant cost savings. The customers must be will to accept trade-offs in selection, product consistency (except for Private Label) and customer service. These trade-offs have different importance for the small business customer and individual consumer. Small business, which represents 2/3 of club sales, easily accepts these trade-offs.
As many use the internet to check out prices and products, the same method could be used for the warehouse clubs compared to like items in luxury good shops.
But, one would think, there are two levels (maybe more) of luxury goods. Would you think to find a Donna Karan in Costco, or Versace? The same would apply to jewelry and diamonds. And, hasn’t there been counterfeit luxury products sold in Sam’s Club’s?
Unless the warehouse clubs can secure the major designers of clothing goods; jewelry, etc., the “world of luxury” is non existent in clubs! Clubs vs. Fifth Avenue and Michigan Avenue shops and stores…where would you go?
Just a perspective…. Hmmmmmmm
It seems to me that luxury goods in warehouse stores appeal most to consumers who have done some “homework” in advance, know the features that are important to them and have some idea of the “going” price for the item. If one can forego getting the latest model and be flexible in getting a good buy with most of the features one is looking for, there is money to be saved.
But remember, no store is always the cheapest on everything, so it pays consumers to shop around, at least a little bit! This can easily be done on websites, checking store ads, consulting Consumer Reports and other publications, and by asking friends and coworkers. During the upcoming holiday season, there will even be more competition for prices among warehouse stores and retailers and that will benefit consumers.
Remember that knowledgeable sales associates, service, delivery, and return policies vary significantly. And of course that can sometimes mean paying a little more, but it can be worth it. I am amazed at the differences and choices in flat screen TVs and ended up buying one from a specialty store. The sales associate could explain the differences, and even had a copy of the latest Consumer Reports article on TVs for me to read and compare. They also had quick delivery and setup.
And no matter where consumers purchase luxury goods, it’s essential to keep those sales receipts in a visible location in case there is a problem later on and you need to go back to the retailer.
Can I see customers buying diamonds from a warehouse store? Actually yes, if there is some consumer information available and additional training for these sales associates. These types of goods will only appeal to certain types of individuals, but as consumers find that they can purchase a growing range of products at warehouse stores, who knows how that market may change?
The first strategy I’d propose to club store shoppers is “have the cash on hand.” When the local Costo has imported hand-made silk rugs on display for a single weekend you either have the $2,000 in your budget or you don’t. So what if shops in town are offering half the quality at twice the price? Either you have the means to say “yes” in that moment or you don’t.
Same goes for that fantastic deal on a slate pool table, or a molded hot tub with a built-in stereo system, or a hand-carved dining room set imported from the Phillipines. But if you try to go out and comparatively shop club stores for any of these items at a time of your choosing, the odds of finding them on the display floor are pretty slim.
The prospects get a little better when it comes to better quality wines and spirits. That fifth of Patron Reposado Tequila may be $5 cheaper every day compared with other local stores. The very limited choices of vintage port (two ruby, one tawny) are always an attractive deal. And apparel items like cashmere sweaters are a great value at under $100 – similar deals are also available from the Lands’ End catalog if you don’t like the colors or styles on display.
Lately, club stores have done rather well at offering large plasma and LCD television monitors. The prices are competitive, but customers who need installation help may have to hire it separately. Finally, clubs may offer very favorable prices on some items of gemstone jewelry, but definitely minus the luxury purchasing experience. Here, the real super bargains are few. One example on Costco.com today: only $22,399.99 for a one-of-a-kind 2.03 carat intense yellow diamond ring, delivered via UPS (insured, of course).
Once again, either you have the cash on hand, or you don’t.
Interesting comments above. And in my social circle, as apparently in Laura’s, the initial dance of all get-togethers is around who got what where for how much. If, as happened at our home recently, you found a pair of $200 slacks for $7 at Ross’ you win the night.
But while the rest of you are busy actually answering the question…I’m suggesting that this whole topic of luxury purchases in non-luxury environs is actually a deeply spiritual and troubling issue.
The word “luxury” comes to us from Old French ‘luxurie’ meaning “lasciviousness and sinful self-indulgence.” Not only that, but there’s a etymological relationship to the Latin ‘luxus’ meaning “dislocated” and to ‘luctari’ meaning to “wrestle and strain.”
It wasn’t until the 1700s that we bleached the word in order to gently reference “something beyond life’s necessities.”
Here’s the lesson:
If you’re going to yield to sinful self-indulgence you have to pay for that debauchery with expulsion from the retail Garden of Eden; to be forever dislocated and strained because you paid full retail. And that’s the actual sin. People who buy luxury things without even bothering to find a bargain are disliked by almost everyone and indeed should be cast out. Frankly, there’s no fun in owning the item at all in that case. I love Nat Nast shirts. Once found one for $15 at Marshalls. Not being able to find another for my birthday recently my wife bought one from the pro shop – for $120! Bless her heart – but you can feel the spirit leave you just reading about it. That’s like fishing in one of those tourist fish ponds. It’s just not right.
See, if you find the exact same sinfully self-indulgent item at a Costco or on the net thereby obtaining enormous savings which you fully intend to give to the United Way…God will smile down upon you. The act now transmutes from ‘self-indulgence’ to good ‘stewardship.’
And that is why we’ll see more and more luxury items being sold in discount locations. It must be thus for the sake of our own immortal souls.
This topic has been well addressed by the preceding comments.
We live in a tenancy where luxury goods are necessities to a growing army of consumers with growing discretionary incomes. It is a well established market and represents a potentially lucrative target for warehouse clubs. But price is only one of a set of complex objects in selling luxury goods. It takes personal service, brilliant showcasing and a sense of theater, and delivering those unique things should be the goal if clubs want to earn a strong share of market in luxury goods.
As Sam’s and Costco are strategically constructed today, people will buy a TV set there and have it installed permanently in their home, but they do not seem inclined to buy a Lexus or Porsche, a mink coat, a well-crafted suit or a 3-ct. diamond there. These luxury goods are more personal in nature and do not blend well with impersonal self-service. Consumers with the wherewithal to buy such luxury goods want the psychic income that comes from personal attention and aggrandizement at time of pre-purchase. Warehouse clubs that can find the stage on which to supply such reassurances could sell luxury goods.
Retail formats have changed and expanded over the years, however, the art of shopping hasn’t changed too dramatically. Today’s shoppers, other than using the internet to compare prices and features, are price and value conscious, while expecting to be treated with respect and honesty in a clean organized environment.
Most warehouse clubs have built a reputation for quality and reliability, and many shoppers have accepted the limited selection warehouse clubs carry. In the area of luxury goods, many shoppers have found Costco to have a broader selection of the luxury goods that they’re looking for, and other warehouse retailers are catching up and trying to compete.
Shoppers looking to buy just on price alone find that price comparison shopping will generally yield the best price. However many shoppers today either don’t have the time, or don’t want to make the effort to compare prices. Instead they choose to depend upon their past experiences and the reputation of retailers they’re shopping, and most time they’re not disappointed. Other shoppers, however, choose to shop at luxury retailers, or retailers known for their product expertise and selection.
Shoppers need to understand their motives, expectations and limitations in order to find what’s best for them. Many times, items can be compared either on price or feature through the web. However, there are other factors such as service and support after the sale that will affect their decision. Except for the impulse buyer, the best decision should be based on experiences, reputation as compared to their own expectations. Shoppers will find that most warehouse clubs want the opportunity to show the customer that their products are of equal or better quality at a lower price, and if the customer isn’t satisfied, they will do whatever it takes to satisfy them. In the end, shoppers will get what they’re looking for, whether at a high end luxury, or full line retailer, or at their local warehouse club.
The best strategy for making the most out of warehouse clubs is:
1) Shop regularly for staples such as groceries, cleaning and office supplies, health and beauty products, books and motor oil with the objective of lowering the ongoing cost of maintaining your household without having to clip coupons or look for sales.
2) As needs arise for high-end electronics such as televisions, computers and cameras, include the warehouse clubs in your comparison. They will often have the best deal.
3) Set some money aside, and on each visit, check out the rotating “treasure hunt” merchandise, which includes seasonal, fashion, jewelry, accessories, gifts, home furnishings and high end cosmetics. These items are almost universally well-priced and of high quality, so comparison shopping is not the issue. The question is, whether or not this is an item you will really need (or want)! Buy the items that you need now, or anticipate needing in the near future. For example, if you spot the perfect necklace for an upcoming holiday party, grab it. If the ideal patio set is on display, and it’s time to replace the set you bought in the 90’s, go for it!
4) Don’t wait until you have a pressing need. For example, don’t go to a warehouse club expecting to replace your bedding. Instead, check out their selection every time you shop, and when you see a pattern that you love, make the purchase.
Not all consumers shopping for luxury items are the same. With today’s fragmentation of consumer markets, the discount stores like Costco definitely appeal to a niche group. Those consumers who want to be in exclusive shops to enjoy the ambiance are not likely to be shopping at Costco. Those consumers who normally purchase luxury products and are familiar with prices but enjoy finding a bargain will be found at Costco enjoying the “hunt,” especially when they make a “find.” Costco will never appeal to all luxury goods buyers, but they do appeal to a specific subset. In addition, other customers who do not normally purchase luxury items also enjoy making a “find” that they can afford, thereby extending the range of consumers purchasing these products.
As Richard points out, it depends on the category you’re shopping for. However, I think there is a misconception about what luxury goods are and a luxury brand is. Everybody seems to be marketing its products and brands as “luxury,” in an attempt to lure customers and justify higher prices.
If we’re talking about luxury Maisons, here’s my take on their strategies for selling to warehouse clubs and what customers can expect:
Although luxury Maisons are very aware of the possibility of capturing additional mindshare and dollars from the millions of high-income warehouse club members, when they decide to offer their prized creations through these stores whose concept doesn’t align with their brands’ luxury quotient, they do so in a very careful and measured manner in order to preserve the perceived luxury status of their brands.
As such, customers looking to buy fashion branded luxury products in warehouse stores should expect 1) a limited selection of products from any one brand (however, overall selection is sometimes decent since you can find a number of brands offering their products), 2) slightly below-normal prices (don’t expect rock-bottom prices. Luxury Maisons won’t allow it because it dilutes the perceived status of their brands), and 3) last season’s products, or products from a “classic” line that is created or extended for large yet non-core customers such as warehouse stores.
One of the keys to both value and experience is the availability of expert advice and service after the sale. I recently had the experience of shopping for a digital SLR for my photographer wife, a laptop for my college student and some reasonably good wines for a dinner party. The homework on all was done online at a variety of websites, supplemented by visits to our local camera shop, Best Buy, CompUSA and my wine shop. Then I went to my club store. Result: the digital SLR purchase went to Wolf Camera, the laptop purchase to Best Buy and the wine purchases to Sam’s Club. The rationale for each decision was similar, and related to the required service after the sale. My photographer needed to have someone to give advice about accessories such as lenses, etc. and to help out with technical issues. That favored the local camera shop. My college student needed to get service in Minneapolis, and I live in Chicago. That was further complicated by the fact that he is not a member of the club store. The wine purchase was easy. I knew the vintages I wanted, Sam’s Club had them at a better price than my bottle shop and I knew there weren’t going to be any returns.
The best game plan for shopping luxury items at clubs is to search with an attitude of fun and finding the unexpected. It’s the Costco “treasure hunt” experience they try to create.
With the clubs set at 12% to 15% margins, you are going to get a great bargain compared to margins 4 to 6 times higher in department and specialty stores. Over coffee last month, I heard two latte sippers checking out their auction bid on Sams.com, so the club search can even extend online. If you find a better sale price in a store, online or absolutely have to have the lowest price including sale or clearance, I have never had any problem with receipt in hand, returning an item to Sam’s or Costco.
The more open to options you are the better. If you can say, “I want a luxury watch for Christmas,” instead of a specific model, the better off you are. The fun is finding luxury brands and quality you recognize that have the appropriate drool factor. Yet every woman I have polled when asked if they would rather have a smaller ring from Tiffany or a larger ring from a club, has picked Tiffany, so buyer beware on that one.
Clubs occasionally offer trend with price. And don’t forget food and luxury at the clubs. Costco is known for a fine wine selection to include pricey hard to find labels.
So, for club shoppers there are real cost savings and the concern of possibly finding something for less is more than offset by the opportunity to find the unusual or known luxury item, confident that at its worst it’s still a great bargain. Clubs make it fun to shop, have an air of exclusivity and now it is trendy to brag about how much you saved while spending hundreds or thousands.
BL’s, Costco, and Sam’s Club won’t have a sustainable economic model if they only sell to unsophisticated consumers (people unware of the “true” bargain price). Luxury goods purchasers want to feel good afterwards, and if they do feel good, they’ll return for more. If they discover afterwards that the items purchased weren’t outstanding buys, they’ll feel burned. All warehouse clubs, like most retailers, need repeated business to thrive. So the luxury assortment has to be ultra price-competitive. And is the biggest competitor full-margin specialty stores or eBay?
Sam’s new “once-in-a-lifetime” gift packages include a Cessna Citation Mustang business-jet. Say what you want about warehouse clubs, that’s just plain COOL.
Let’s take the questions in order:
Price: With other retailers offering to, “beat their best deal,” the issue of pricing has really become one of price impression. Could you get a better price on a flat screen television than you can at Costco? In most markets (at least where you have any significant, aggressive price competition), the answer is almost surely, “Yes.” But, that’s not the point. Warehouse clubs have added a new trick into the standard retail repertoire, what I call high ticket impulse purchasing. The idea is to get the consumer excited enough to temporarily suspend their natural impulse for price comparison. It works, but only if the consumer is caught up in the moment.
Experience: I think the answer to this question depends on what you’re buying. If you buy a pair of pants at Costco and take them home and they don’t fit, you can return them with relatively few problems. As a consumer, you’re also less likely to make a purchasing error on a high end tool chest or appliance. But, what about jewelry? My sense is that the very high-end shopper wouldn’t buy a diamond from Costco. They’re still going to go to Tiffany, or wherever, as much for the experience surrounding the purchase as for the purchase itself. It’s like when Costco used to advertise low cost coffins as you walked out of the stores. The price might have been right, but who wants to think of themselves as somebody passing on to their eternal reward in a cheap coffin?
Selection: Ostensibly, consumers are trading variety for cost. If you don’t buy the premise, you probably won’t buy anything else.
There’s no “right answer” to this question because it depends on what category you’re shopping for. Are you looking for electronics or jewelry? Are you shopping for a name-brand (like a plasma TV) or a diamond ring with no brand recognition?
It also depends on the competitive landscape in your own market. You may have Sam’s, Costco and BJ’s all competing against each other, or (more likely) one or two of the players in the warehouse arena. This may affect how aggressively the clubs compete on price against each other or the big boxes.
For branded electronics like high-end TVs, do your homework! Use the websites of the clubs as well as their key competitors (Best Buy, Circuit City, even Walmart.com). Do the online prices for the clubs compare favorably to their big-box rivals? If so, you’ll probably find the same price advantage in-store. But make sure you are comparing similar features as much as possible, since manufacturers will work to provide each retailer with its own “exclusive” model name or number.
For jewelry, it’s trickier — but doing your homework still makes a difference. Get an education (either on-line or in a jewelry specialty store) about the “Four C’s” of diamond jewelry. (Color…cut…clarity…carat weight.) Make certain, if you decide to buy in a club, that they are offering certified diamonds that will stand up to independent appraisal. And don’t close the sale without understanding the store’s service and return policies!
Skeptical as I was that any attempt by Sam’s to chase Costco’s upscale treasure hunt model would end up as a diluted me-too effort, the new prototype in Bentonville proved me wrong. However, the difference in this store isn’t so much the $27,995 Yamaha Disclavier grand pianos or the $31,462 1.5 CT diamond rings (the “most tried-on ring” according to the woman running the jewelry counter), but rather the customer service. Trained staff was on hand in mattresses, jewelry, consumer electronics, and other high-ticket areas and any time I looked a bit long at a plasma TV or ring, someone spirited over a no interest payment plan coupon.
One of these associates told me that her primary job was to help articulate value to customers who are comparison shopping. This store portends of a new customer service model for Sam’s that will educate consumers and facilitate sales in the process.
Sam’s, like most retailers these days, has awakened to the fact that consumers are educated regarding price and quality and they are absolutely offering “deals” accordingly, particularly on high-ticket items. Watching teens rummage through a display of True Religion jeans and checking out the interest in Dooney & Bourke quilted signature purses, it is clear that Sam’s is offering real value on high-end items and that moreover, consumers “get” it. Consumers can buy with confidence at warehouse clubs. The retailer has done the homework for them!
Warehouse clubs are filling a niche that many retailers have almost abandoned: shopping as an entertainment experience. Consumers looking for zing in the shopping experience with the thrill of a treasure hunt and perhaps finding a bargain, will enjoy the warehouse club experience. However, those consumers looking for a specific brand and model at the lowest price, will find that warehouse clubs may not be their best bet.
Costco has further refined the entertainment experience at the luxury end by recognizing that overwhelming a consumer with selection hurts both the shopping experience and sales. By keeping its product selection smaller than mass merchants, Costco keeps its stores from overwhelming the customer. Its jewelry selection may compare more favorably to a specialty retailer, but the environment drives the perception that customers are getting a bargain.
Those warehouse clubs that overwhelm the consumer and try to fit in luxury goods are struggling to make the mismatch work. While luxury item buyers like a treasure hunt and may be willing to sacrifice the personal attention delivered by luxury retailers, they don’t want to paw through thousands of items to find that special gift. So warehouse clubs have to find the right balance between a luxury treasure hunt and simply tossing the consumer into a mass of merchandise and hoping they will find what they want.
Warehouse clubs aren’t for those consumers who want to be pampered when spending a lot on luxury goods. But, for those who want some shopping fun, the thrill of feeling like they found a bargain, and the opportunity to sometimes find a really good price, warehouse clubs can be an entertaining alternative.
Yes, almost without exception, most items in warehouse clubs are priced with a lower mark up than similar items in traditional retail channels. However, there is a trend, particularly in store exclusives, to take additional margin. Here are a few tips to improve the chances of truly getting a bargain.
1. Educate yourself. Rarely are you going to be able to compare the precise item to itself between warehouse clubs. The more you know about features and products, the more you’ll understand a price difference. Particularly in jewelry, the information is available on line to “get smart.”
2. Avoid “exclusives.” A store buys an “exclusive” from a manufacturer because they think it gives them an advantage. Many times, that advantage is in meeting the consumer’s needs in a unique way. Most of the time, it is to allow the retailer to get additional margin by removing the ability of the consumer to compare “like to like.” The exception to this rule is in commodities such as fine jewelry, where the size, clarity, color and cut of the gem are available information.
3. Be prepared to hunt, or don’t be selective. Warehouse clubs offer a vastly reduced assortment, particularly in upper end goods. If you go “looking” for a bargain, don’t have precise expectations of what that looks like. Specific item shopping is best done over the Internet, where portals exist to find the item and compare prices for you.
4. Shop “occasion” or “person” rather than “thing.” The bargains really are there. Sam’s and Costco really do take a lower margin than their promotional cousins. They also buy it from the manufacturer at approximately the same price. If you shop with a person or an occasion in mind, then the offering you see has a higher probability of being attractive. If you are shopping for a specific thing, find out if it’s carried first.
All points are right on, a key one being that today’s consumer is very savvy. When looking for a high-end product, they typically do their research prior to coming to the store. If they are looking to be lured by the “kill thrill” of a surprise bargain, impulse reigns supreme.
The other is that it’s about laser focus to the consumer that they seek to serve. When it comes down to it, it’s all about the segment and what their tolerance and drivers are. Certain segments would never be driven to the warehouse for high ticket items. Others are highly motivated by it. Costco seems to have done a great job, as they started to attract higher end segments with their wines and slowly added more high end products. The skus they carry are carefully matched to the demographics, psychographics and purchase analysis of the store locations to that they are relevant to those shoppers.
Regarding pricing, sometimes they truly deliver and sometimes they don’t. I found a Coach purse for $90 and a $180 pair of designer jeans for $90. These were surprise finds and keep me coming back looking for more like them. Sometimes I win, sometimes I don’t…but the thrill of the hunt truly motivates a certain segement of shoppers like me. Yes, the experience is inferior. But worth it if the bargain is good enough.
Warehouse Club assortments are roughly a tenth the breadth of a traditional mass merchandiser.
While there are certainly differences between the Warehouse Club players in their customer/assortment strategy, the two largest (Sam’s and Costco) have similar target customers. Both offer in-depth assortments for their core business customers as well as offering seasonal and treasure hunt opportunities for both their business and non business customers.
Dominating this sector is a priority for the operators as it builds loyalty, increased visits, increased membership and, of course, volume. Attaining this victory can be a win-lose situation if they are unable to keep their club environments exciting as well as profitable.
This is where the treasure hunt approach to the business comes in. The skills at assembling and displaying luxury goods as well as other higher margin goods is important if they are going to balance their margins. This means that they are going to try and differentiate themselves from their competition through private label, branded products or other creative approaches to merchandising which will offer the “shock and awe” value that is the key to driving excitement at the club level.
If both Sam’s and Costco carried identical luxury or branded product, they would end up competing on price here as well, which would in turn reduce the potential to create that unique and exciting shopping experience that helps drive loyalty, increased visits, volume and so on (not to mention the potential to limit the increased margins they are hoping for).
If a customer understands this, then it can help them to weigh the pros can cons of shopping for “luxury goods” and thereby simplify their strategy decision making.
Clubs will offer one-time-only assortments of high quality, great value product. This product will change frequently and beyond the expected seasonal approaches, will be fairly unpredictable. Therefore, their strategy here would simply be one of impulse; if they shop often enough they just might find that something special that – while they weren’t looking for it – found it and are thrilled with the value (such as Baby Grand Pianos, a full sized German Made Green House or a 96 point bottle of 2003 Chateau Cheval Blanc Bordeaux).
No matter which way you slice it the customer strategy could be pretty straightforward: the more frequently they shop, the more likely they will be to discover something just right for them!
Here are just a couple of quick suggestions relative to luxury shopping in warehouse clubs:
>Go to look regularly with an open mind; you’ll be very surprised at what you find.
>Use the website; it saves time.