Big box retailer Costco is on a roll in 2023, with net sales up 9.4% for the fourth quarter and its stock price is up 25% on a year-to-date basis. Costco memberships are up 7.9% from the fourth quarter of 2022 to the fourth quarter of 2023.
Costco is also looking to up its digital game as the retailer looks to connect with younger customers who are accustomed to leveraging the internet and mobile apps to get their shopping done.
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That’s okay with Costco, which just announced that visitors to its e-commerce platform are up 40% on a year-to-year basis.
This week, the company announced new improvements to its website and mobile app, with Q4 signaling the “early innings” of its e-commerce, mobile app, and digital sales and marketing efforts, Costco chief financial officer Richard Galanti said this week on the company’s 4th quarter conference call.
“In terms of recent additions and upgrades, we've recently redesigned our company account page and the digital membership card,” Galanti said on the call. “We also redesigned the header with a larger search bar and expanded selling space.”
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Costco has also recently added “an app box” for messages and advertisements right in the app.
“We've also recently opened an optical digital store where you can virtually try on glasses and then order them for pickup, prescription glasses,” Galanti added. “There are also ongoing improvements in our Costco app, offering in-warehouse shopping tools to our customers such as a digital membership card, managing shopping lists, viewing warehouse savings, seeing the gas prices to the extent there's a gas station there.”
Fairly soon, Costco members will be able to search warehouse inventory and scan barcodes from the app, Galanti said.
“With the improvements made thus far over the past year, our app store rating has gone from a dismal 2.3 stars to currently 4.7 stars,” he noted. “Unique visitors in the site are up 40% year over year, and the Costco app installs are up 46% year over year. So, all in all, progress is being made.”
Two years ago, Galanti said Costco was often “late to the game” with its digital shopping efforts, but it's catching fast with its new e-commerce and mobile app initiatives.
It’s just in time, too, as competitors are digging into digital, too.
Sam’s Club, for instance, has added Scan & Go which allows store customers to open the Sam’s Club mobile app, scan a physical product’s package bar code, and pay for that item in the app, with no checkout required (although shoppers will likely be asked to show their digital receipt on their way out the door.)
Costco is trading at $568 per share on September 29 while Sam's Club is a subsidiary of Walmart, whose stock is currently trading at $162 per share.
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