IM Lessons from Costco vs. Wal-Mart?
Interesting article on MSN Money today that, I believe, could have Internet Marketing insight and application. Of course, you be the judge.
re: "Why Costco is Walloping Wal-Mart"
Costco does well when American family budgets don't. Wal-Mart does better when America shops for name brands, "... a sign consumers have more money to burn." Costco is "... stealing customers from low-price rivals, including Wal-Mart (WMT)."
Their reasoning:
- Costco has a no-frills pricing focus on low-cost deals (like bulk packaging)
- Costco is more urban (think masses, big city, huge traffic to one location)
- Costco charges annual membership dues, a unique, very profitable, non-product revenue source
- Costco has very low overhead (pallets of goods stacked on cement floors)
Steve
re: "Why Costco is Walloping Wal-Mart"
Costco does well when American family budgets don't. Wal-Mart does better when America shops for name brands, "... a sign consumers have more money to burn." Costco is "... stealing customers from low-price rivals, including Wal-Mart (WMT)."
Their reasoning:
- Costco has a no-frills pricing focus on low-cost deals (like bulk packaging)
- Costco is more urban (think masses, big city, huge traffic to one location)
- Costco charges annual membership dues, a unique, very profitable, non-product revenue source
- Costco has very low overhead (pallets of goods stacked on cement floors)
Steve