A
cherry picker is a retail term for customers who only patronize a store for the sales, usually the deep discount
loss leader items. While cherry pickers are expected, too many cherry pickers can be disastrous for a business.
In the late '80s, Canada's highly successful
Canadian Tire retail chain tried to break into the American market in the
South West. It opened up a chain of automotive/
hardware/home products stores under the name "White Triangle". In an already hyper competitive local hardware-and-automotive market, the White Triangle chain tried to win market share by offering a wide range of popular products at loss-leader prices. Unfortunately for Canadian Tire,
hard scrabble Texans knew a value when they saw one.
Legions of cherry pickers descended on the stores, scooped up the loss leader items, and then as quickly vanished. The White Triangle venture failed miserably and Canadian Tire was forced to pull out of the American market.
Cherry pickers are generally viewed by retailers as a
pesky sort that end up being
hoisted by their own petard. That is to say, the time and gas cherry pickers expend hitting the sales do not result in any over all savings. In sum, they'll burn $2 of gas to save $1 on toilet paper.
However, a recent study by two marketing professors at the
Wharton School of Business have shown that diligent cherry picking can, in fact, result in real savings.
Many stores try to get around the worst effects of cherry picking by limiting quantities a consumer is allowed to purchase. This strategy ends up
back firing as this ends up alienating the majority of consumers who views a good sale as a reward for loyalty. The best strategy, the Wharton school profs found, is to offer cherry pickers compelling high margin items that will offset losses.
The
Costco mega warehouse chain offers a good example of this. With a customer base that is practically cherry pickers to the core, it counters low-margin sales with a compelling array of unique "
restaurant quality" convenience foods not found at traditional grocery stores. Frozen
gyros, frozen
Mission-style burritos, massive slabs of
baklava all tempt even the most
intractable cherry picker.