Costco Shoppers Feel Scammed by Little-Known Membership Pricing Rule

A Costco shopper has raised concerns about a little-known rule that charges full price for a shortened membership, leaving some customers feeling deceived by the retailer.

This rule comes into play when members renew their subscriptions, surprising many.

Costco Membership Renewal Controversy

Costco was embroiled in legal trouble in 2009 when it faced a class action lawsuit over its practice of backdating membership renewals, as revealed by The U.S. Sun.

The retailer was found to have wronged customers by not extending new memberships beyond the original expiration date if not renewed within three months. This policy effectively made shoppers pay full price for only nine months of membership.

Following the lawsuit, Costco was ordered to compensate affected members, which included offering free memberships, costing the company approximately $38 million.

In response to the lawsuit, Costco amended its membership policy.

Previously, a membership renewed after a three-month lapse would not extend past the original expiration date. According to Costco's website, if a membership is renewed within two months after expiring, it extends for 12 months from the original end date. If renewed later, it restarts from the renewal date.

While this policy change reduces the expiration period and slightly improves the terms, it still results in members paying the full annual fee for only ten months of service if they delay renewal.

This adjustment, detailed on Costco's website, disappoints some customers.

Also Read: Aldi Faces Backlash From Customers Over Unusual Shopping Cart Rule

Costco Membership Renewal Scam Alert

Costco shopper Toby Betsen was surprised by the retailer's membership policy and shared his findings in a Facebook post to inform others.

He advised Costco members to check the expiration date when renewing their membership, as it might not always reset to one year from the renewal date.

Betsen highlighted a scenario where a member's initial expiration date was March 31, but they delayed their renewal until the end of May.

He explained that the store would still charge the full annual fee, but the membership would only extend until the following March 31, effectively providing just ten months for the price of 12.

He criticized the policy, noting that although it had improved following a lawsuit against Costco, it still felt deceptive. "They were doing it a lot worse until they got sued.

For some reason, they are allowed to scam people," Betsen remarked. He warned that without scrutinizing the fine print in the membership agreement, customers might not realize the extent of what they agree to, calling the situation a "complete scam."

Following similar frustrations expressed by Costco members, Sam's Club faces backlash over its special shopping hours policy, as reported by Franchise Herald.

Cami Hughes-Ross shared her frustration on Facebook, highlighting that non-Plus members cannot shop before 10 a.m., a policy exclusive to Plus members. This has led to disappointment among regular members who feel treated as second-rate.

On Reddit, discussions reveal mixed feelings about this policy; some see it as an incentive to upgrade, while others feel alienated. Despite these concerns, Sam's Club promotes the early access and additional benefits of Plus membership as valuable features, aiming to enhance the premium membership experience.

This controversy comes when retail membership programs like Costco are scrutinized for policies that leave customers feeling short-changed.

Related Article: Sam's Club Early Shopping Policy Causes Upset, Member Considers Leaving