The Marketing Genius Behind The Woolworth Five And Dime Stores

Just about everyone over the age of 45 remembers F.W. Woolworth’s discount stores. They were known as the nickel and dime store, or the five and 10 cents store. Bargains could be found throughout each neighborhood store in the New York City area and nationally, and prices were lower than those found in most other places for more than a century.

Some of the Woolworth stores even featured a lunch counter. A menu from 1957 showcases a deluxe sundae, malted milk, or extra rich ice cream soda each for 25 cents. A regular banana split also was a quarter
while apple pie or layer cake was 15 cents. Nestle’s hot chocolate with whipped topping and wafers also sold for 15 cents.

Frank Winfield Woolworth was born on a small potato farm in Rodman, New York (upstate Jefferson County) during 1852. When old enough, he found a job in a dry goods store in nearby Watertown and noticed that
leftover items from sales were placed on a table and priced at five cents. The merchandise disappeared quickly, and he got the idea of opening his own store and pricing every item at five cents. It didn’t work for him so he gave his idea more thought.

A better location (Lancaster, Pennsylvania) was found for a new store and he opened it during 1879. All items now were priced at five or 10 cents, and all the merchandise was visible to customers.

Prior to this, stores kept most goods in the back. A customer would give the store clerk a list and he would fetch the items. Woolworth’s fresh idea was very successful. He saw the advantage of having customers
see and evaluate a product before committing to the purchase. He brought his former boss into his business and also included his brother. Within a short time, he had stores in many locations and became a
multi-millionaire.

Woolworth in New York

The size of Woolworth’s stores grew as he continued to find new items for display. He added food counters to some of the stores, and Woolworth’s soon became the largest restaurant chain in the country. The more he expanded, the more his purchasing power increased. Profits continued to grow.

By 1913, Woolworth decided to build his headquarters building in New York City. At the time, it was the largest building in the world and he paid for it with cash – $13.5 million.

Woolworth on Long Island

To remain close to his business yet enjoy a lifestyle away from bustling city, he built a mansion for his family in Nassau County’s Glen Cove area during 1916. The home had 56 rooms and the grounds required 70 full-time gardeners. He insisted that contractors install a grand staircase of pink marble, with the cost for just that one item a bit more than five or 10 cents – it was $2 million. He called the estate Winfield Hall and it became one of the most beautiful estates in the country.

At its peak, about 4,000 Woolworth stores could be found in America. But sales began to decline a few years later. By the time Woolworth died during 1919 from a tooth infection (he was afraid to see a dentist), about one thousand stores remained. He was entombed in a grand mausoleum in Woodlawn Cemetery in The Bronx.

The last Woolworth store in the U.S. closed during 1997 as the company reinvented itself to concentrate on its successful sporting goods subsidiary under the Foot Locker name. Some stores that use the Woolworth name still can be found in other parts of the world but they don't have any association with the original company.

F.W. Woolworth had a great marketing idea that lasted more than a century, but his business changed when goods began to cost more than a nickel or a dime. No longer can a 12-pack of Topps baseball cards bring
joy to a young boy for only 10 cents as it did in The Bronx during the 1960s.