Costco Wholesale Corporation

Costco Wholesale Corporation

Costco Wholesale Corporation is the largest warehouse club in the United States and the second largest retailer after Walmart. The store operates on a low-priced, high-volume sales model. They accept the effect of impulsive buying, as demonstrated by a customer in the film, who claims that whenever she enters the store, she ends up buying more than she planned. Customers must choose the accessible brand because the business does not carry a large variety.

Marketing Philosophy

Costco subscribes to the marketing philosophy that claims that businesses should assess their consumers’ needs and build a strategy to meet those demands better than their competitors on the market. The store abides by this, and ensures availability of products for the customers though with limited brands. The 64 million members, long queues, comments are proof that they love shopping at the place compared to their competitors on the market attributed to its capability of making profits to a tune of $93 billion, yet they do no advertisement.

Market Research Strategies

The applied market research employed by Costco included ensuring customer satisfaction, which is evident from the comments made by some of the customers who indulge in impulse buying whenever they find themselves in the store. Market segmentation has enabled them to keep their large number of members, and if not, register more with no membership. Assessment of consumers’ attributes has enabled them to understand what and when to avail certain commodities to the shelves, an example is availing fewer brands to minimize confusion to the customers who have limited option, and in the process do not have to work away without buying the product because of confusion.

Basic Methods of Market Research

Basic methods of market research employed by the Costco include Surveys which are conducted to regulate their pricing and it is because of this that they are able to sell their products in a different manner and quantity at a reduced price of 30%. Their membership is made of those with a good average annual household income showing their secret in focus group.

The Scientific Method

The scientific method is a process of decision making that concerned with the testing of ideas before agreeing to use them. It is because of this approach that the company was established, and continued to expand and grow. Costco stands a better chance to integrate marketing research in its operation to increase the number of its members, which automatically results in more profits.