Across virtually every section of a Costco Warehouse, Costco's in-house Kirkland Signature brands are ubiquitous. From vodka to ice cream to golf clubs, Costco members are not only loyal to this brand, they love to speculate who is the real manufacturer.
So, why take packaging lessons from Kirkland Signature? The incredible success of Kirkland Signature is amazing.
In 2020, Costco's Kirkland Signature™ brand saw a global sales growth of 7% to $52 billion.
Costco in 2020 has global net sales of $163 billion. Nearly 1/3 of those net sales ($52 billion) was on Kirkland Signature products. Wow! This was a growth of 7% over 2020. Is Kirkland Signature an important, well recognized and valuable to Costco? You better believe it!
This success is no accident. There no one better than Costco at understanding their members and understanding what type of packaging drives sales.
So, what can we learn from Kirkland Signature? In short, the Kirkland team recognize and are the masters in focusing Product over Brand.
Here's some examples.
When there are multiple products, Costco ensures to focus on not only on the product but the specific differences. Look at plastic bags for example.
HEAVY DUTY, OUTDOOR, EXTRA LARGE, SCENTED
All show the differentiator quickly and easily. When it's possible that Heavy Duty and Outdoor may be confusing, Kirkland Signature adds a photo of leaves on the bag on outdoor and a trash compactor on heavy duty. Extra large adds a photo of a large trash can.
What does Kirkland do when there are multiple similar products and they need to differentiate?
Here's an example with honey:
On honey, it's not only the product name "HONEY" but, what makes it unique is critical . "RAW", "ORGANIC", "WILDFLOWER" all are easily and quickly communicated to the member.
Let's talk the importance of organic (critical component of a Value Statement).
Costco prides themselves in having incredible value on organic products. Notice that if a Kirkland Signature ever has an organic product, how "ORGANIC" is so prominently displayed:
Why is Product over Brand so important at Costco?
You need to have your product recognized!
Product over brand is critical at Costco because the warehouse shopping experience can be overwhelming. Aisles move around. Its a treasure hunt. You have 5 seconds to be seen and 5 seconds to communicate our product value to a member. Focusing on clear, concise value statements is your tool to stand out.
In a world where products can come and go, you need to have your product recognized to be sold. First and foremost.
Do other brands learn this lesson?
Sure, many do although the Costco Packaging Guys know there is room for continuous improvement. We were motivated to write this story after a trip to our local Costco Business Center. A young boy asked his mom in a very excited voice "Mommy, what is Venom Steel?" certainly hoping this was a toy or game.
A young boy asked his mom in a very excited voice "Mommy, what is Venom Steel?" certainly hoping this was a toy or game.
Unfortunately for this boy, Venom Steel is an absolutely fantastic product although not what the he thought. Venom Steel are premium rubber gloves. We wondered how many people race by this pallet display needing rubber gloves and never recognizing this great brand which isn't exactly a household name.
Venom Steel's packaging design is extremely eye catching although with a few minor tweaks would communicate the product and the value much better.
We hope this helps give a little more insight on Product over Brand at Costco.
Please reach out to us with ideas, questions or comments.
We were here to help you drive sales with great Costco packaging.
Until next time.