It's a loss leader -- something sold at a loss for the sake of attracting customers to a store. Maybe they go to the store with the specific intention to buy a chicken, or they choose the store over another because they can get a chicken along with other stuff that they need. Either way, they end up spending more money on other (profitable) things.

well the effect I heard is that even people who don't buy the chicken (ever, they just aren't chicken buyers) buy more of everything else due to the smell. So the store doesn't need to sell any at all, it just needs to be there. Though come to think of it this actually wouldn't affect price (because that smell effect would hold true if it's too expensive, right?) so perhaps it's a combination of both your effect (which affects chicken buyers) and the one I heard about (which affects non-buyers).

That doesn't really make much sense in a massive warehouse store like Costco. You're not going to smell the chicken unless you're very close to it.

Its also a somewhat common practice to cook raw food right before its self life is up to give it another shot at being sold. So by going through the expense of cooking it, they prevent the loss of having to throw it out. Not all stores do this though.