I remember a story from years ago about a family-owned ice-cream shop in a small town. Folks came from long distances for ice cream because it was so delicious. Yet, the customer had one constant complaint — there was too much ice cream in the cone!
The owners of that shop decided to listen to the client and make the cone half the size. They also rebranded their product at the same time and chose to charge twice as much for less. Can you guess the outcome? Ice-cream sales went up.
A few times I have sat in an ice-cream shop and calculated the sales per hour. It amazes me how much people will pay for ice cream. Add a dime’s worth of chocolate and charge an extra dollar; add a nickel’s worth of whipped cream and charge an extra $2; add a penny’s worth of candy and revamp the cone to a confection and add $3. Now that is selling.
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Ice cream is a treat for all occasions and for most children and adults it evokes a memory of summer days. In Canada, where warm days melt swiftly, each savoury moment is cherished. In winter it is hot apple crisp with ice cream; hot chocolate and ice cream; or my childhood favourite — pancakes and ice cream. Like opening the hood on a ’52 Chevy or the lid on a picnic basket, you just can’t beat the FEEL of ice cream.
I think that this is a prime example of the experience economy.
We live in a time when consumers want to experience food and flavour, and have a little bit of a walk down memory lane or create a memory in their young home. On the farm, we are familiar with a huge roast with all the fixings, pies and cakes, veggies from the garden, fruit off the tree, bread fresh from the oven — all eaten around Grandma’s table. For others, let us remember, it is a simpler time with fewer food blessings than we enjoy on productive farms.
Regardless of the setting, consumers have proven they are not afraid of paying more for what they want, even if there is less of it. They do this when they pick out flowers, buy a smaller but fancier car, choose a little bit of chicken that is homegrown, or pay double for organic eggs. They do it when they order a petite tenderloin rather than a huge steak or an ounce of port over a glass of wine. What drives them could be a memory, a need, the experience, or a preference. Whatever it is, we need to find the right-size cone.
In the protein aisle, we need to provide the choices they desire such as hormone free, grass fed, free range, humanely handled, or organic. In the vegetable bin, they need to see fresh local (at least from within the province), chemical free, organic, or farmer-branded product. And that goes for fruit as much as possible, too. I do not enjoy buying an apple from New Zealand when our Canadian apples are so abundant. Nor do I fancy carrots from California when Alberta carrots are crisp and sweet. Price is not the only driver in deciding what to buy.
Think about the constant lineup at a premier bake shop. Again, the scent of fresh bread evokes a memory and the fact that it was made in your little town or down the street hugs the love-local bug. Paying $6 for a wee bit of bread is never considered an extravagance when it meets the needs, wants, and desires of the purchaser. Part of that experience is also how we feel and what the shop looks like. Customers want to ‘belong’ to your foodie club, even if it is simply because your shop is cosy and has the best coffee, or because your farm is welcoming and the lamb is delicious.
My friend Henk van Dongen, an internationally renowned food and flower retail expert, likes to tell the story of tomatoes. There are many kinds of tomatoes that one can buy, but Dutch retailers were not happy with sales, especially on those big tomatoes sold in bulk. Enter Henk who did some testing on those bulk bins of slicing tomatoes — looking at flavour, texture, nutrient profile, storability, and so on. Next he started looking at how folks could use a tomato and among the many trials he did was grilling. It turns out the ugly duckling in the tomato bin was terrific for grilling. The retail store rebranded and offered those bulk tomatoes in small packages (at double the price) as a grilling tomato. Sales went up.
I love these examples of how we can help our consumers see the possible and through the experience of food, hospitality, and environment, find a lovely price point for our products. Not every family can afford to pay more for less but there are times when helping folks understand product, presenting them with what they want, or simply ensuring that they have a memorable time is priceless.