Is the Treasure Hunt Strategy Working for Costco?

Abstract

The purpose of this paper was to find out if Costco’s “treasure hunt” strategy was effectively attracting customers and increasing spending per visit. It was an exploratory research to provide insights in the perceptions of Costco customers in reference to new, seasonal, and premium products (“treasure hunt”) in their shopping habits, in comparison with purchasing regular items. An initial survey was developed for this purpose and sent to a sample of 150 individuals with a 55.33 % response rate (83 completed the survey), and a second survey was sent to the same sample to find out additional complementary information, this time with a 29% response rate. The results showed that only 4% of the sample population (that shop every three months at Costco) was predominantly attracted to these seasonal and premium items; however, all respondents agreed that these items are an important complement to the regular purchases, and that they increase their spending per visit. On the other hand, results also confirmed that these items do not necessarily increase the frequency of visits for Costco members of this group.

Keywords: Costco, treasure hunt, merchandising strategy, marketing, consumer behavior, shopping habits, strategy

JEL Classification: D11, D12, M21, M31