Kroger adds one of Costco’s most popular in-store features

Published 7:58 am Friday, February 9, 2024

By Daniel Kline

: Costco also sells clothing.

Costco has turned its stores into destinations.

Yes, people join the warehouse club because it offers low prices, but the retailer has also made it fun to shop in its no-frills stores. It’s not uncommon, in fact, to see families making a grocery-shopping trip to Costco (COST) into an event.

The chain offers low-cost meals that appeal to all ages. Who doesn’t like a piece of pizza or a $1.50 hot-dog-and-soda combo? Add in the higher-end sandwich options, as well as the dessert choices, and a family can make lunch or dinner part of their shopping experience without stretching their budget.

In addition, Costco also offers a treasure-hunt shopping experience. You never know exactly what to expect when you walk into one of the chain’s warehouses, and you might come home with a bestseller, a giant tub of chocolates or a new sweater.

Even if you don’t buy, it’s still fun to see which items are in stock and imagine exactly where you might put a six-foot teddy bear or how a new Nerf gun might be fun to own.

In addition to its food court and ever-changing merchandise, Costco also brings in customers with its sampling. On most days, the chain has people stationed around its warehouse clubs handing out samples of various food and drink items.

You might get a little cup of a new soda flavor, a cup with a piece of candy in it, or even a station where someone cooks up a meal or snack. It’s a fun part of the in-store experience and it leads to people buying items they may not have been aware of or did not know they liked.

Club Demonstrations Services, Costco’s vendor for in-store sampling, operates sampling operations in the chain’s warehouses. CDS President Amy Lang and Kroger’s customer experience vice president, Bill Brantner, answered questions from TheStreet via email about sampling, its effectiveness, and Kroger’s plan to grow its own Costco-like sampling operation.

Offering samples has been a longstanding part of the Costco experience.

Image source: Brooks Kraft LLC/Corbis via Getty Images

Sampling has been effective for Costco, Kroger

TheStreet: Does sampling actually lead to purchases?

Amy Lang: Yes, sampling definitely leads to purchases! Halverson Group ran a survey on 2,234 US Costco members in 2023 about sampling and found that:

75% enjoy a food sample on every trip
90% say samples influence their decision to purchase a product, and this is an increase of 7 percentage points since 2019
94% say they prefer to sample before making a purchase, an increase of 5 percentage points since 2019
2 in 3 members will buy a sampled product again if they purchased it after trying it, and usually 2 more times

Bill Brantner: According to data provided from 84.51 (Kroger’s data house), yes. Sales lift for our Kroger program averaged more than 400% lift for 2022. Not only does sampling lead to purchases on the day of an event, brand new household conversions and repeat purchases make a significant impact on sales as well.

TheStreet: Do people visit stores because they’re offering free samples?

Lang: Yes. From the same study 98% of members said samples enhance their Costco shopping experience. Anecdotally, we know there were tons of news stories and memes when sampling started again at Costco — things like “the pandemic isn’t over until samples are back at Costco,” etc.

Brantner: According to recent OSAT scoring compiled from customer receipt surveys, customers enjoy sampling and would like to see more of it!

Costco, Kroger take a careful approach to sampling

TheStreet: Is there a negative to sampling where consumers push back at having products pushed at them?

Lang: At CDS we actually have an interactive process, and the idea is to start with a smile and an invitation; it’s a very gentle approach. We are not there to be pushy or try to convince people to come over.

Our job is to advocate for the product, help customers discover new products they didn’t know about or find new ways to enjoy them.

The negative side is that you do sometimes get people who will take the product out of guilt, like they feel bad for not taking what’s offered, and then they put it down somewhere because they didn’t actually want it. Other times you have customers who fight with other customers to get the last sample, but that’s probably the most negative thing we see. Overall, it’s a very positive shopping experience that customers love.

Brantner: We don’t push products to shoppers, but we do invite them to try a sample. That’s when the real engagement begins and product talking points are conveyed.

More Retail:

TheStreet: Are many brands planning in-store events and sampling leading up to the Super Bowl? Are there any examples you can share?

Lang: Customers should expect to see things like frozen appetizers, wings, etc., being sampled, along with lots of chips and drinks, as these are the core foods party planners will be offering at gatherings to celebrate the Big Game, etc.

Brantner: We normally do see an uptick in programming leading up to any holiday or holiday season.

TheStreet: Can Kroger make samples part of their model in the same way Costco has?

Brantner: We have developed a program for Kroger’s top 200 stores where we execute multiple events per day in those locations. These events focus on fresh and often provide total meal solutions. The idea is to drive shoppers from station to station.