Retailing: of Chocolate and Frozen Yogurt

My wife and I stopped into a local retail store that sells specialty chocolates. There were many individual chocolates lined up in the display case, much like a doughnut shop. We selected four chocolates in a couple varieties we wanted to buy and after a wait, the employee weighed the chocolates and charged us by weight, not unit. The price was $2.50 per chocolate; our sale totaled $11.49 for four normal sized truffles. We were shocked - it just seemed like that was expensive for chocolate. We probably would not go back, and would be very careful if we did.

A few weeks earlier, we went to a local frozen yogurt shop. You may have seen one of these stores which have 15 soft serve spigots with different flavored yogurt, and then a large selection of toppings. You grab a cardboard bowl and then fill it with yogurt and toppings. The resulting sundae was also weighed and the price set accordingly. The price was a bit higher than we wanted, but we felt like if we returned we would know how much to get.

Two retail stores, both using weight as a method for charging customers.

I would argue the chocolate shop is making a serious error in charging by weight. Since a chocolate is discrete, you wouldn't normally think about it as something whose value is in the weight. Moreover, this particular chocolate is very high quality - but weight is not usually a sign of quality. If your customers are unable to gain a sense of what something will cost going in, they are likely to shy away from the shop. Consider a father with his kids - he certainly does not want to get caught with a large bill for a small amount.

Finally, since there was no signage that the chocolates were going to be weighed, I had no way to know what they would cost. Nor do I have any sense of what a chocolate weighs.

But in the case of the frozen yogurt, I know how big a bowl I eat of ice cream - by going once and creating my sundae, even if it is more expensive than I thought it would be, I can now size future sundaes appropriately. How could I do the same with a single chocolate?

The moral of this is not to go have dessert with me.

Perhaps a more useful moral is that as a retailer, be sure that your pricing model fits with your customer expectations. My example of a doughnut shop above is instructive - we all know that doughnuts are sold per piece. I, as an experienced doughnut eater, also know roughly what a doughnut would cost.

If you are going to break that expectation, you had better make sure right up front that the customer understands what you are doing, and in a way that he can know roughly what it is going to cost him to get out of the store. No matter how good your chocolate.