Employees at Costco, one of the biggest retail chains in the US, have offered advice to customers who feel overwhelmed by the store's forceful membership policies.
An employee of Costco took to Reddit to express their thoughts about the company's intense approach to encouraging memberships among customers.
Costco Employee Voices Concerns on Membership Pressure Tactics
The post highlighted, "Please do not be mad at the employees," emphasizing that the staff themselves are not fond of incessantly urging members to upgrade, sign up for auto-renewals, or download the app.
The post detailed that the company's higher-ups are behind these persistent requests. It acknowledged that numerous customer complaints have arisen due to the staff's assertiveness.
However, the employee offered a potential solution, advising, "If you want something to change, you need to speak up to management or corporate," as stated in the post.
Meanwhile, A Costco employee has encouraged members to compare the store's membership promotions with other retailers like Sam's Club or BJ and to suggest improvements to Costco. "If members show a preference for competitors, Costco will take action to retain their business," the employee wrote.
In response to the post, customers shared their experiences. One customer acknowledged the quotas set by corporate but criticized the employees' approach: "The hard sell tactics and disrespectful tone are up to the employee. We can raise concerns about that."
Another customer added, "I don't blame employees for adhering to company policy or their assigned tasks."
For those wanting to express their views, Costco offers online customer service channels for direct communication.
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Costco Tightens Entry Rules to Prevent Membership Misuse
In recent news, members must show their membership cards upon entering Costco. These cards are strictly non-transferable, but Costco permits members to give a second card to another person in their household. Additionally, per company rules, each cardholder can bring up to two guests per visit.
However, Costco has observed increased non-members using borrowed membership cards, especially after introducing self-checkout. The company requires a photo ID and membership card at self-checkout to address this, mirroring the policy at regular checkout lanes.
"Non-members shouldn't enjoy the same benefits as our members," Costco stated when announcing this policy.
In a new move, Costco is trialing an entry system where members must scan their cards at the entrance rather than just showing them. This change was first noticed in a Washington State store, with photos appearing on Reddit.
Costco's finance chief, Richard Galanti, mentioned to CNN that membership sharing has risen since the 2020 pandemic. The new scanners, currently being tested in select stores, aim to streamline entry and checkout processes. "This should speed up both entry and checkout," Galanti explained. "We're piloting this to see its effectiveness."
This initiative reflects a broader trend of companies like Netflix taking measures against shared memberships.
In 2022, Costco had approximately 66 million paid members and 119 million cardholders, ranking it among the largest membership clubs globally. Members opt for a $60 annual regular membership or a $120 "executive" membership, which offers extra benefits.
This membership structure is vital to Costco's success, especially during the pandemic. The annual fees significantly contribute to the company's profits and help balance expenses, enabling Costco to maintain low product prices.
Any membership growth or renewal rate shifts could adversely affect Costco, potentially leading to price increases.
Costco's income from membership fees reached $4.2 billion in 2022, a 9% increase from the previous year. The company also boasts a high renewal rate of 93%.
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