Comment by queuebert
19 hours ago
I wouldn't call it a gimmick when the business has been so successful for so many years. They target educated shoppers who want to buy quality at minimum markup and not think too hard about it. If I want a TV, I know Costco will have good ones at a good price. If I need socks, same. Their food is cheaper and better than Kroger. It's just a win-win for shoppers and Costco. The only tradeoff is selection and dealing with the crowds.
What you wrote sounds intelligent but belies an ignorance of the business model.
Parallel to that, I have to imagine Costco makes a lot of money off of impulse purchases, which are induced by uncertainty in the specific items they will have available, plus mutable store layouts.
Long ago in undergrad I took a retail marketing class and we did a field trip to Costco; the GM told us it was part of their policy to rearrange parts of the store occasionally so that you had to browse the entire place to check off your shopping list. This increases the likelihood that you stumble across new products. So it’s this combination of “best price/quality without decision fatigue” plus some impulse buying that works for them. The fact that they are figuring out the price/quality trade off for you up front probably also makes it easier to impulse buy with fewer regrets.
I have seen things move for no reason, but I have seen things remain where they are for a decade. I am in south bay and go to Sunnyvale Costco. They move their bread, the oil and bunch of stuff many times, but the wine (which I do not partake) has not moved, the batteries are exactly in the same spot for decade(s), I find my dishwasher liquid exactly in the same spot, and although I do not consume it any more, but I am 100% certain the eggo waffles have not moved an inch in 2 decades. Yes toilet paper has moved but it is right adjacent and is explained by making it easier than harder to find things.
Maybe it depends on the GM.
Hope I do not jinx it :)
Yea so true. Unlike many with families here, I (a single 26M) recently got a costco membership for the gas savings, whenever i stop by costco in the middle of the month, i'm looking for one or two things. This time it happened to be peanut butter, it's insane the amount of times I had to tell myself, no you dont need this, get peanut butter and leave.
Ofcourse it's very convenient that their app doesnt show what aisle things belong to so that was a fun realization.
The word is treasure hunt. Stores like Costco or TJ Maxx (there are others) use what they call the treasure hunt. They design the whole experience around you walking around hunting for that new piece of treasure that you have to buy.
Yeah, this right here. I don't want to sift through thousands of options. Sometimes I just want a widget that is good quality and I don't want to get ripped off.
Exactly. Competition and choice is good for the market, but the ideal shopping experience is where there is exactly one option and it satisfies your needs.