Costco Wants More to Go Clubbing Online
Costco is not a lightweight when it comes to selling online. The company generates $2 billion a year in sales and is among the top 20 online merchants in the U.S. That performance, while respectable, is not what the Costco organization expects of itself.
"Does it drive us crazy when others do a lot of business? Yes," said CFO Richard Galanti, on a conference call in February. "But we recognize we do some things they can’t do and they do some things we are not going to do."
What Costco has done is begin to make changes to its website to make it more search engine friendly. It is also looking to expand the business to markets outside the U.S. Costco plans to introduce Android and Apple smartphone apps this month to give consumers more shopping options.
"A lot of other chain retailers, including Walmart, are doing things sooner, better and quicker, including going international," Mark Brohan, director of research for the International Journal of Electronic Commerce, told The Seattle Times. "Walmart has included Sam’s Club in its aggressive plans for overseas online sales, including China, and Walmart is buying social-media companies to get hold of the always-connected buyer."
Costco is also looking to more actively cultivate existing club members into shoppers on its website. Currently, according to Ginnie Roeglin, senior vice president of Costco’s e-commerce and publishing operations, roughly half of existing members are registered on the chain’s site.
- Costco plans first smartphone app, new Google-friendly Costco.com – TechFlash
- Costco makes plans for boosting its online sales – The Seattle Times
Discussion Questions: How important is it for Costco to improve its online performance in light of consumer trends and steps being taken by competitors? What improvements do you think would have the most immediate positive effects?