Do you know what first stimulates your sense of smell when you enter a Costco store?

It's the famous aroma of rotisserie chicken. A whole roasted chicken is sold for $5.6 in our neighborhood.

In today's world, where a pizza costs $20 and a box of chicken wings is $20, how can a whole chicken be just $5.6?

Costco is not trying to profit from this chicken; rather, it symbolizes the company's philosophy.

Rotisserie chicken is not just a food item; it represents Costco's beliefs.

First of all, the price of this chicken has hardly changed in decades.

Even when chicken prices rise, logistics costs increase, or labor costs go up, Costco has kept this chicken priced at $4.99.

However, not all regions in the U.S. sell it for $4.99, but the price difference is less than $1.

Ultimately, this is a classic example of a 'loss leader' strategy that you might find in a business textbook, haha.

Costco focuses on attracting customers by selling chicken below cost.

In 2023, they reportedly sold a staggering 137 million chickens.

Customers who come to pick up this cheap chicken end up browsing other products, electronics, or even renewing their membership.

This chicken's price embodies Costco's philosophy (Sam's Club is already selling similar rotisserie chickens at the same price).

First, it's about trust with customers. Costco operates on a membership basis, which means customers must trust that 'this place exists for me.' The fact that the chicken price hasn't increased is not just a number; it's a message saying, "We respect your budget."

Second, it's about simplicity. When you go to a Costco store, you are not overwhelmed with choices; instead, you are encouraged to buy essentials in bulk, reasonably, and at a good price. The same goes for rotisserie chicken. Even without fancy seasonings or embellishments, it maintains a simple taste that satisfies everyone.

Another interesting point is how much effort Costco puts into this chicken.

They don't just source it from external suppliers; they have established their own chicken farming facilities and processing plants.

At this point, they are essentially running a "chicken kingdom." The reason is simple: to maintain stable quality and stable prices.

This philosophy is closely tied to their unique membership structure.

A significant portion of Costco's profits comes from membership fees rather than product sales. In other words, even if they lose money on a chicken, if it creates a 'foundation of trust' that encourages customers to renew their membership, that is a much more valuable investment.

And I believe this philosophy aligns well with today's consumer psychology.

Many people ask themselves, "Can I trust this company?" when they make purchases.

In an era where consistent pricing and quality are far more powerful marketing than exaggerated advertising, Costco chicken becomes more than just food; it symbolizes reassurance for consumers and serves as a brand icon that visibly represents the company's philosophy.

Ultimately, when we eat Costco chicken, we are not just experiencing a savory and salty taste; we are receiving an unspoken signal that "Costco is a place that can be with me in the long term."

If the day comes when Costco raises the price of chicken, it won't just be a matter of $1 or $2; it could signal a shake in Costco's philosophy.

So today, Costco stubbornly continues to roast that chicken, and we casually place it in our carts.