To paraphrase Dr. Seuss: oh, the places a senior whose mind is rapidly unraveling from the all-consuming stress of finishing his college apps will go. My freshly ravaged mind, as may constitute no surprise to some, led my feet straight into my car and down to the nearest Costco. As I courageously navigated through the bustling warehouse, braving a more intense environment than any Everest climber or War of 1812 veteran before me, I began to reflect on so-called “Costco culture.” Why is it that Costco is so structured like a city, as each customer is forced to constantly keep moving or face a shopping cart stampede? Why do so many people rely on its food court for their daily meals? Do its membership cards create a feeling of exclusivity for its members that preys on the worst excesses of human nature? These are all fair questions, none of which I have definitive answers to. But, alas, for no clear reason, I suppose I shall venture a guess.
Anyone who has ever, from what must have been a severe lapse in judgment, chosen to go to Costco on a Saturday will know how congested it gets. The parking lot fills with the rowdiest drivers known to man, and every aisle fills with shopping carts swerving out of each other’s way. At times, a Costco, with its towering warehouse shelves and bustling aisles, can seem like its own metropolis. The popularity of this shopping behemoth can be fairly attributed to a variety of factors, but I attribute it to the famous requirement that all Costco shoppers must pay for a membership. While seemingly an annoying hurdle put in place by greedy managers, Costco’s membership program serves a greater purpose: promoting brand loyalty. Knowing that one is a member of some sort of exclusive club boosts their ego and makes people feel special, and people in such a heightened state of perceived superiority love to spend money. If they are already paying for a membership and deciding between Costco and Trader Joe’s for this week’s groceries, they might as well go with the brand they have already spent time and money supporting. This way, Costco does get some revenue from membership, but they simultaneously get something far more valuable: loyal customers who will always choose them first.
I would be remiss in covering this topic without mentioning the converse of the relationship between Costco and its customers, namely the loyalty the corporation shows them through shopping experiences like the food court. The prices at Costco food courts are so famous that I need not even mention the price of its hot dog, as your brain can probably conjure it by itself. Keeping food prices this stable and this low in the face of rising inflation represents an interesting decision for Costco, one that sees a worldwide corporation prioritize happy customers over potential profits.
Through this practice, Costco shows customers some of the dedication that customers show to Costco. I will stop short, however, of romanticizing this as some sort of consumer-corporation love story. This strategy still intends to maximize profit, designating Costco’s food court as something called a “loss-leader,” based on the idea that Costco is willing to lose money on the food court so long as it attracts customers and shoppers for its other products. If someone enters Costco to pay $1.99 for a slice of pizza, Costco management hopes that their eye will catch one product they like, then another, and another. One shopping cart of impulse buys later, they exit having spent $400.
Costco’s membership fees and food court, just as everything it does, are very intentionally and specifically planned out. Every tiny aspect of its products, store layout, pricing, and memberships target different parts of human psychology and are meant to inspire complete devotion and love for Costco. Next time you go to Costco, think about everything you see, hear, touch, and feel, and remember that all of it has been carefully designed to be that way.
