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The Jewel Tea Company was founded in 1901 in Chicago, Illinois. They began by selling tea, coffee, cookware, and other goods by wagon. Later, as its door-to-door business was threatened by changes in the law, Jewel converted to a new business model of physical self service stores. In response to World War II, Jewel continued to innovate by including women and further expanding their product selection. Jewel Osco developed the “supermarket” model of diverse products that was copied by numerous competitors that we recognize today. This company has been very successful throughout various periods of history because of their innovative business and marketing strategies.

In 1899, Chicago tea salesman Frank Skiff rented a horse and wagon and began selling tea, coffee, and spices door to door in the Chicago stockyards neighborhood. Unfortunately, Skiff’s original business was a flop. To save the business, Skiff partnered with his brother-in-law, Frank Ross. Together, they founded the Jewel Tea Company in Chicago, Illinois in 1901. They named the company Jewel Tea, because Jewel meant it was of a superior nature. Soon, they started to grow very fast. By 1915, they had eight hundred fifty routes and eight million in sales.

The Jewel Tea Company grew quickly during their early days because they had very good business strategies. To attract new customers and keep old customers, they used premiums. A premium is a prize or incentive that a customer earns after buying a product or service a certain number of times. The premiums included china and rugs. People liked Jewel’s premiums more than other companies’ because they were worth more than the coffee itself. Because people wanted these premiums, they would buy products to earn them, earning Jewel more money. Most companies at the time used this strategy. However, what set Jewel apart were three unique marketing strategies that differentiated them from their competitors.

First, an innovative strategy they used was advanced premiums. The story goes that one day, Frank Skiff (the original owner) was going around the city advertising his premiums when a woman suddenly attacked him with a broom. She explained that a company had promised her a premium if she bought their products, but they conveniently went out of business before she could claim her prize. Skiff had the idea of “advanced premiums.” Advanced premiums are where a company gives a premium to somebody as soon as they become a customer, and trusts them to buy enough of their product that they actually earn it. This business model ran the risk of them being scammed by people who just wanted a free premium, but overall, they made a profit because now, everybody trusted their premiums. Jewel was the first company to ever do something like this, and it caused their popularity to skyrocket.

Second, the quality of their premiums set Jewel apart. Jewel gave away very good premiums such as rugs and tea sets, which were worth more than the coffee itself. These premiums were products that many customers felt were out of reach financially for people in their economic class. That caused more people to become loyal to Jewel, which led to more sales in the long term.

Third, their premiums came in sets. For example, if you earned a teapot, they would offer you some cups, and then a kettle, etc. with the same pattern. Jewel was the first company to do this, and, again, it caused their popularity to skyrocket. People earned more and more premiums because they wanted to earn the whole set of premiums. Eventually, some people had bought so much coffee that they had a whole tea set of high-quality china.

In addition to these innovative marketing strategies involving premiums, one of the first important innovations of Jewel was to focus on high quality coffee. Although door-to-door coffee salesmen were common, most sold low quality, old coffee. In contrast, Jewel imported coffee beans that they ground and packaged themselves and sold fresh. This meant that their coffee tasted better and was better for a customer.

Jewel was also innovative in their early years by reaching out to their female customer base. They formed the Homemakers’ Institute in 1924, which collected recipes and tips made by customers, and then distributed these recipes and tips to other customers through Jewel News, which was a “folksy publication.” This allowed the Jewel customers to feel closer to the company and feel like they were actually helping one another. This good customer service eventually resulted in many new customers and sales. The person behind this amazing idea was Mary Dunbar, the first “Jewel Lady.” There were many other great women that worked for Jewel in their early years, including Leone Carroll, who had degrees in chemistry and home economics and began directing the Jewel Homemakers’ Institute in 1926. She served in this role for 17 years. She became the first woman executive for Jewel, which was extremely rare in that time.

Despite their success with door-to-door sales, Jewel continued to innovate and began to grow into physical stores and the grocery business. In 1932, the Jewel Tea Company bought a chain of grocery stores in Chicago owned by Loblaw Groceterias, a Canadian company. Loblaw needed to sell these stores because they were struggling financially; the Great Depression reduced their sales just as they had over expanded into the U.S. market.

Jewel was interested in buying physical stores primarily because of the Green River Ordinance. Green River is a small town in Wyoming. They passed an ordinance that said you can’t go to people’s homes to sell products uninvited. This meant that traveling salesmen couldn’t get any new customers. The ordinance wasn’t yet passed in Chicago, but was being passed in numerous other cities. Jewel read the writing on the wall, so to speak, and wanted to reduce its reliance on door-to-door sales.

In the beginning, the grocery stores were not successful at all. They lost as much money as they spent on buying the grocery stores. Jewel’s president at the time, Maurice Karker, was told that he should give up the stores. But they kept pressing on. In 1934, they surveyed over 18,000 women living in Chicago to see what their ideal grocery store would look like. No other company had ever done this before. They took the results from the survey and created the “Ten Commandments:”

1. clean stores

2. friendly service

3. self-service

4. honest weights

5. fair dealing

6. freshness

7. quality

8. variety

9. good prices

10. money back guarantee.

As a result of implementing these innovative 10 Commandments in their stores, their sales skyrocketed. No other grocery store in Chicago was as good as them.

Jewel had the best employees because they treated them with kindness. Not many grocery stores treated their employees very well. The company gave them good pay, life insurance, and overall made their lives easier. Treating the workers well made them more friendly to customers, encouraged the employees to work harder, and encouraged customers to choose Jewel over other grocery stores.

Jewel stores were also honest to customers. They only charged you for the actual weight of your purchases. A lot of other stores at the time would weigh products wrong on purpose to charge more. Jewel also innovated by importing fresh fruits and vegetables daily. Most other stores at the time didn’t do this. They had fruit that had been sitting out for days. This made it taste worse and rot sooner. Additionally, Jewel implemented the first standards in their meat departments to make them better. Their meat was cut fairly, so you wouldn’t have to pay for all the fat. Also, they only sold meat that had been inspected by the government. As a result, their meat was much healthier and safer to consume. Now, instead of making a separate stop at the butcher, customers could buy meat along with their other groceries.

Taken together, these innovations encouraged customers to shop at Jewel for all their grocery needs. Eventually, Jewel moved out of the door-to-door business and began to focus on their highly successful stores. As they learned, people preferred to go and buy the items at a store than order them and wait days for them to come. Because of their success, other chains of supermarkets began to diversify their products.

With the outbreak of World War II, Jewel again had to innovate in order to remain successful. At this time, Jewel struggled due to shortages of various foods, rationing of sugar and coffee (their two main products), and lack of workers because many men were away at war. In response to these difficulties, Jewel contracted their business, reducing the number of stores and routes they served. Jewel also gave many opportunities to women in order to have enough workers, which was uncommon before the war. By 1944, women managed over 25% of stores and controlled over 700 sales routes.

Jewel also directly supported the war effort by helping to provide soldiers with food. They developed a waterproof, gasproof, and fireproof ration that would float. By the end of World War II, they had provided US soldiers with over 160 million meals.

During this period, Jewel continued the good treatment of its employees. The company allowed employees to try out new and innovative ideas within its stores. For example, in 1954, the manager of one Jewel store began selling flowers inside the store.[4] This idea was an instant success and lead to the floral departments we see in grocery