Is Cheap Name Brand Chocolate a Good Thing?

Clay Gordon
02/05/08 20:39:05
1,680 posts
I was in one of my local Costcos (I am "blessed" to live near two) on the Tuesday before Thanksgiving and I wandered down an aisle I normally don't and saw not only packages of Hershey Cacao Reserve tasting squares but also boxes of Neuhaus chocolates.I did a double-take. Neuhaus. At CostCo. And I wondered ... "What is this world coming to that an upmarket Belgian brand with a retail presence of its own would start selling chocolate under its own name at Costco?"This is dangerous territory I think. Sure, the company get additional sales by selling to an audience that would normally not visit its stores because of the perception that the product cost too much. On the other hand, why would anyone go and spend top dollar in the retail boutique if they can buy the same product at Costco?The answer might be that they are not buying the same product - that what they're buying at Costco is not the same quality as what's available at the boutique.But what's the damage to the brand? Neuhaus is one of the oldest Belgian chocolate and founder Jean Neuhaus is credited with both the invention of the shell-molded truffle and the ballotin box.Is Neuhaus in Costco a good thing? For consumers? For Neuhaus?

clay -

updated by @clay: 04/09/15 20:53:36
02/11/08 19:16:30
29 posts
I think this is a common mistake that many higher end brands take in an effort to drive more sales. And most of the time it results in the dilution of its brand along with a broader move to becoming more common at the expense of diluting its premium price tag. In my opinion place (i.e. where the item is sold) is one of the most important differentiators a higher end brand, like Neuhaus has. Visiting a boutique store to find your favorite chocolate brands is part of the fun. If Neuhaus feels it needs a broader distribution channel it should look at alternatives that are more aligned with the Neuhaus image, I'm thinking Whole Foods would be a better compromise.


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