As a business consultant, I always look at Costco with a lot of interest. It took me a good 2 years to be convinced that I needed a Costco membership card.
I used to piggyback once or twice a year with a privileged family member. Now, I am a member and I enter Costco feeling special, as if I belong to a privileged club of bulk buyers! Well, at least, that’s the perception most people have!
For those unfamiliar with Costco, it sells a variety of products from a multitude of brands including its own private label Kirkland. One can buy from the bricks and mortar warehouse stores or online. At Costco, you are not just a customer but a member; even if it’s partly semantic, the word makes a difference.
Don’t expect to be pampered at the door and to be able to a ask staff member information about a product at every corner of the immense warehouse. However, you are greeted at the door when you present your membership card, and then you are pretty much on your own. I think the mere fact of showing a membership card unconsciously makes us feel special – we are part of this gated community, we get access to what other people don’t…
The online experience is pretty much the same. Costco practices are non-intrusive. All is laid-out for the site visitor to see everything they want us to buy. They strip the shopping experience artifacts to the bare minimum and it works very well.
With over 55 million members, Costco’s strength is in their customer service. No questions asked, you can return any item you have purchased, even food. Items purchased online can be returned to any warehouse store. Even Electronics goods can be returned within 90 days and come with free technical support for 2 years. Rebates are applied and reapplied, even if item is defective.
As a business consultant, helping companies integrate social media, I cannot help but look at the Costco case and wonder in terms of their social media footprints, or rather, their lack of? Costco has no official social media presence; they do not have a Facebook page, no Twitter account, no blog.
However, Costco has advocates all over the Internet; Several unofficial accounts on Twitter reach several thousands of followers and active discussions taking place; On Facebook, the main unofficial Costco page has over 100,000 fans { people liking it } and on several blogs and forums, discussions often happen around the wholesaler.
Costco keeps it simple and efficient, whether it is their physical environment, the products, the services. No frills. You know what you get and keep coming back.
From my point of view, Costco’s success resides in good products, reasonable prices, solid processes, engaging and reliable customer service, efficient services, and nurturing a strong sense of community – albeit, apparently not on social networks.
Why would a company such as Costco not establish an official social media presence?
Perhaps it is Costco’s strategy to not participate, maybe they are monitoring and working a social media program behind the scenes; I could keep on speculating but I just hope, whether they choose or not to integrate social media in their business strategy, that they are using social media for monitoring the brand and listening to what their advocates, customers or detractors are saying and I do advise, they come up with a crisis management plan for social media.
I would love your insights if you happen to know or are aware that Costco has decided officially on not using social media? Do you know if perhaps they are at least monitoring? Leave a comment !
Karima-Catherine Goundiam
I’ve spent a good deal of time in Costco – as a shopper, executing on brand marketing, and working with distribution folks behind the scenes.
Without a doubt, social media does NOT fit within their “all about the member” mantra. I don’t blame them: they are focused on providing the lowest-price products to members.
And I’ll defend them, too: Objective is to sell products at a fair price to members. Strategy is to get products in their stores through killer distribution, logistics and relationships.
Social media does not fit within the objectives.
Sorry to be the nay-sayer.
Hi Dan,
thank you so much for your comment. I do appreciate your point of view very much as I think Costco is probably one brand that may get away with not actively participating in social media.
However, I advise they monitor because it could help them gain even more customer insights and allow them to gain business intelligence for products/services offerings.
Furthermore, by establishing an official account, Costco could have a channel to distribute offers and news, aside from their online website.
Costco might not do social media the same way others do but they can certainly find their own model that fit their business strategy.
What do you think?
@karimacatherine
Karima-Catherine,
GREAT observations.
The insight I have gained by speaking with someone inside Costco is they are still trying to figure out how to leverage social media, measure the return, etc.