Costco's new perk involves discounts for online shopping

Thursday, December 9, 2021
Costco's new perk: online shopping discounts
Costco is offering a new benefit to members to help the warehouse chain compete with Amazon: 20% off select online purchases.

Costco is searching for ways to make paying $60 for a membership every year worth more to online shoppers - and keep them away from Amazon.

So it's expanding an online perk available only to club members: Buy stuff from around 35 brands' websites and save 20% or more.

The program, called Costco Next, first launched in 2017 with just a few brands. But Costco has recently ramped it up, offering an array of products such as Anker phone chargers, Mikasa dinnerware, Weatherproof outdoor clothing, Invicta watches, HO Sports floats and tubes, and Sumbody skincare.

Costco is now advertising the program prominently on its website, and plans to add more brands and products in the coming year.

Costco has hooked its more than 60 million members on perusing stores and spending $400 on Saturday afternoons. But e-commerce makes up only a small percentage of Costco's sales and its online business has slowed this year after surging in 2020.

The retailer hopes discounts on goods online will give customers another reason to renew their memberships and signal to shoppers that Costco is more than just a physical store.

The program, Costco says on its website, helps it bring in new merchandise "while increasing the value" of a Costco membership.

Costco narrows choices for members at stores, stocking mainly the top-selling items that it believes offer the most value to customers, and it's taking a similar approach with this program.

Instead of offering thousands of products from hundreds of brands, Costco is curating select items - the retailer says they are brands' popular products that are often in limited supply.

Costco is applying other lessons from its success in stores, where it frequently changes merchandise and adds new items to try to get customers to come back and see what's new.

It's also trying to create a similar treasure hunt experience with its online initiative: "Costco Next is continuously evolving, frequently adding new brands," the website says. "Discover what's new."

Costco members can buy products directly from the brands' sites and use their membership number - without coupons or promotions- to save on their purchases.

MORE | Costco raises minimum wage to $17 an hour

Costco this week raised its starting wage for hourly store workers in the United States to $17 an hour as businesses hike pay to retain workers.