It’s really hard to think of a store that has a customer base as devoted as Costco. Around the world, an estimated 145 million people carry a Costco membership card. There are entire social media accounts dedicated to tracking the latest deals, and others that exist purely to post memes about the place.
The tweets and jokes people share about shopping there are honestly endless. Several couples even got married at a Costco.
So how did this retail chain build such a loyal following, and how have they managed to keep it going for years? According to CNBC, it’s no accident. The brand uses a number of clever strategies to keep customers coming back.
It starts with the way Costco operates on a basic level. To shop there, you need to buy an annual membership for either $65 or $130.
That makes the store feel a little exclusive and therefore more appealing. You have to be part of the club just to walk through the door.
But there’s also a psychological layer to it. Since membership fees are a “sunk cost,” consumers feel the need to justify the expense, which leads them to shop more often and buy more each trip, according to Kusum Ailawadi, author of a 2017 study on club shopping.
“You’ll say… I’m going to make sure I get my money’s worth by shopping in the club store every chance I get,” Ailawadi told KTLA.
Then there’s the classic Costco experience itself. You know that when you walk in, there will be plenty of free samples to try. You know a $1.50 hot dog combo is waiting for you at the food court. And you can grab a $4.99 rotisserie chicken on your way out.
These little perks make you genuinely excited to visit the store, even when you didn’t plan on buying anything. And once you’re there, you almost always end up leaving with way more than you intended.
Costco has actually kept the price of their hot dog combo the same since the 1980s. From an economics perspective, that doesn’t really make sense. With inflation, the price should have gone up a long time ago. But keeping it unchanged has turned out to be a great PR move.
“It’s still important to get people physically in the stores. We want to continue to get people in the stores, and there’s no better way to do it than a $1.50 hot dog and a rotisserie chicken,” Costco’s then-CEO Craig Jelinek told CNBC in 2020.
Many Costco fanatics agree that the in-house food court is one of the best features of the store.
“I used to go there when I worked and eat a salad for lunch at least once a week,” one Costco fan from Colorado, who praised both the quality of the food and the low prices, told Business Insider.
