Using the Service-Profit Chain to Drive Sales

1 Using the Service-Profit Chain to Drive Sales The chosen company is Costco Wholesale Incorporation. The company strategizes to increase sales by leveraging each link in the Service-Profit Chain through treasure hunt retail psychology which slows the shopping process (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 1.06 & 0.08). The lengthy shopping trip is attained through improvising new time-limited discounted offers to the buyers. The clients are enticed to shop longer to explore a new batch of interesting discount deals and products that are somehow hidden (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 1.28). Another technique for slow shopping is avoiding aisles or instore maps to direct the buyers while shopping and only using aisles numbers (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 0.37). Furthermore, Costco constantly moves some of its products and cycles in new products to compel the clients to explore the products while searching (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 0.49). Through the treasure hunt retail psychology technique, the shopping time of clients is increased, leading them to shop more.

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2 The sales and service model used by Costco company is the Long-term service model. The company aims to establish deeper relationships with the customer and interact with them regularly through the treasure hunt, retail psychology, and membership programs (Sales and Service Models, 2021). Also, the company earns through the membership program of its clients.

One of the remarkable features of the store relating to the customer experience is the huge store cavernous such that some goods are stacked up to the ceiling, which is very high (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 0.19). The narrator says, “That’s all part of the model and the experience” (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 0.28). The impact of the Long-term service model for the company is that there is a sense of urgency in purchasing and always wanting to return. For instance, "If it was the same every time, you might not come as often" (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 1.46). The commitment by the company to lower prices enhances customer loyalty and spreads the company’s brand (Behind Costco's Treasure-Hunt Shopping Strategy, 2021, 3.27). For instance, “customer loyalty helped Costco remain strong during the pandemic” (Behind Costco's TreasureHunt Shopping Strategy, 2021, 5.29). The long-term relationship between the company and its buyers is evident, whereby the company often learns more about customer patterns and needs and markets to them accordingly, especially through the treasure hunt retail psychology (Sales and Service Models, 2021).

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References Behind Costco's Treasure-Hunt Shopping Strategy | The Economics Of | WSJ. (6:08). Wall Street Journal. (2021, Mar 3). YouTube.

Sales and Service Models (2021). Bellevue University. https://cyberactive.bellevue.edu/bbcswebdav/xid-77169694_4