A loss leader pricing strategy refers to deliberately selling some things at a loss, but earning from a markup on subsequent purchases. For example, printer companies often sell printers at a break-even price, but they mark up the price of toner cartridges. Supermarkets use this trick too.
Most customers only remember the “correct” price for between four to seven items. The four most commonly known prices are for rice, bread, milk, and eggs; a handful of other customers may also remember the prices of common fruits (like bananas), or packet goods like instant noodles.
But beyond these, most customers are unable to identify markups. Few people can tell you the median price of 200 grams of black olives, or a 250 gram bottle of chopped thyme. This allows supermarkets to get away with steep premiums on these items.
As such, many supermarkets use “loss leader pricing”, in which common items (rice, bread, milk, and eggs) are sold especially cheap. In some cases they are even sold at a loss. This is to lure you into the supermarket, where you are likely to buy other goods at a markup.
You may also notice a variation on this theme employed by dollar-goods stores such as Daiso. You’re lured by a small number of items sold at a bargain, but you’re likely to also get some other items while at the store.
Daiso is betting that your shopping basket will be filled with several high-margin items, some of which you can buy for much cheaper elsewhere.