Can you use Costco’s persuasion strategies in your business? You can and on this episode of Business Brain, we dive into Costco’s 7 Principles of Persuasion as presented by Joe Portsmouth. Here’s a rundown of the strategies your hosts Shannon Jean and Dave Hamilton discussed:
- Reciprocity: Costco utilizes this principle by offering free samples to customers. Providing something for free creates a sense of obligation and reciprocity in customers to make a purchase.
Commitment and Consistency: The consistent store layout and the familiarity of the shopping experience at Costco reinforce customers’ commitment to the brand. This principle encourages customers to continue shopping at Costco due to the predictability and familiarity of the experience.
Social Proof: Costco creates the perception of popularity and value by having busy stores and long lines. When customers see others shopping at Costco, they are more likely to believe that it offers good deals and value, making them inclined to shop there.
Authority: Due to Costco’s large buying power, customers perceive the brand as an expert in obtaining the best deals. This authority status contributes to customers’ trust in Costco’s pricing and product selection.
Liking: Costco emphasizes friendly and helpful customer service, which makes customers feel valued and creates a positive shopping experience. Costco enhances customer loyalty and trust by fostering a likable and customer-centric environment.
Scarcity: The perception of scarcity is used by Costco to increase the value of its products. Customers are motivated to make purchases when they believe the items may not be available. Costco’s clearance codes, such as items with prices ending in “7,” indicate products likely to be discontinued.
Unity: The warehouse-style store layout and the shared experience of shopping at Costco create a sense of unity among customers. The feeling of being part of a group or community that values the Costco shopping experience reinforces customer loyalty and encourages repeat visits.
Listen in as we steal Costco’s strategies to grow your own business.
- 00:00:00 Business Brain – The Entrepreneurs’ Podcast #450 for Friday, May 19th, 2023
- 00:01:52 Costco’s 7 Principles of Persuasion (from @Joe_Portsmouth)
- 00:03:15 Reciprocity
- 00:06:09 Commitment and Consistency
- 00:07:50 SPONSOR: Found. Business banking that tracks your expenses, helps you find write-offs, tracks your income, calculates your taxes, and then saves the right amount so you’re not scrambling at tax time. Signup for free at Found.com/brain today.
- 00:09:28 SPONSOR: Thinkific Plus is a powerful training platform that lets you create materials to educate your customers so they stay being customers. Get one month of Thinkific Plus FREE at Thinkific.com/BusinessBrain today.
- 00:10:57 Social Proof
- 00:11:52 Authority
- 00:13:39 Buying Kirkland Clothes!
- 00:14:50 Liking
- 00:15:29 Scarcity – If the price ends in “7”, it’s going away SOON.
- 00:16:23 Unity
- Costco Cult
- 00:17:19 Shannon’s Number 8: $1.50 Hot Dog and Soda
- 00:18:01 BB 450 Outtro
- If your email is featured in an episode, you’re entered to win a MacBook Air in 2023