Discount War: Sam’s Club Makes Its Hot Dog Combo Even Cheaper Than Costo’s
This means war. A hot dog war.
Here in America, apparently we’re having a big warehouse store hot dog showdown right now. Who knew this was coming?
In a wicked but kind of funny act of corporate trolling, Sam’s Club is slashing the price of its $1.50 hot dog combo by 12 cents to $1.38. That buys you a hot dog and a soda.
Big deal, you say?
Well, we say this is definitely Sam’s Club’s way of messing with its rival, Costco, which has its own longtime $1.50 hot dog combo special. And Costco is famously proud of its super-cheap hot dog and soda combo, which has cost the same since 1985.
Costco CEO W. Craig Jelinek once told a Chamber of Commerce crowd that keeping the price at $1.50 was a big deal — kind of a matter of life and death, actually.
“I came to (Costco co-founder Jim Sinegal) once and I said, ‘Jim, we can’t sell this hot dog for a buck-fifty. We are losing our rear ends.’ And he said, ‘If you raise the effing hot dog, I will kill you. Figure it out.’ ”
(Folks on Reddit promptly drew up T-shirt designs and logos with that “I will kill you” quote. Apparently it’s kind of iconic.)
Now here comes Sam’s Club, stirring up trouble — unilaterally slashing the price of its $1.50 combo by an entire 12 cents, without asking for anyone’s permission or anything! Oh, those cheeky devils at Sam’s Club!
They even had the gall to put out a totally innocent-sounding news release, practically batting their eyelashes, saying, “Lowering the price by twelve cents on a member-favorite item is just another way to show we care about every penny (literally) they spend with us.”
Riiiiiiight. And also maybe stick it to Costco a little bit.
Sam’s Club and Costco are America’s two giant chains of membership-only retail warehouse clubs, and for decades they’ve offered up affordable hot dogs as a perk for members. Inflation hasn’t changed that strategy, despite the price of frankfurters going up 15% in only a year.
The hot dogs are considered a loss leader, a strategy designed to entice shoppers to stay in the store a little longer. So you stop for an inexpensive snack, and the more time you spend wandering around inside the humongous discount store, the higher the chances are that you’ll see something you want and make an impulse buy.
So, go ahead. Enjoy that $1.50 (or $1.38) hot dog and a soda. Tasty, isn’t it?
Just remember why it’s there.
Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder.