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Milestone Three: SWOT Analysis
Kelvon Glass
MKT-500
Lee Ann Walker
October 8, 2023
Costco SWOT Analy
Strength: ●
Business Membership Model: Membership only for customers make them feel important and exclusive
●
Idea of low cost: Cheaper prices for Customers when
purchasing their ideas larger other than in bulk
●
Customer service & worldwide growth: Costco offers ways to help its members, expands all over the
world
●
Employee and operations satisfaction: Higher pay to employees and great management treatment
Weakness:
●
No ability to shop online: like their comp
Costco has no online shopping & pick up
●
Few options to pay: Theres only a few w
pay either by Visa, cash or personal chec
●
No advertising funds or department: If yo
realized Coscto doesnt have advertising b
to the company it speaks for itself Opportunities:
●
Give more options for members: Give more products
and services to customers ●
Better marketing through social media: build a social
media presence for younger audience ●
Different payment options and more payment options: More options to pay and even create financial payment plan
●
Online presence and purchasing: Create better online
website that includes online buying
Threats:
●
Competition digital engagement
●
Expansion for competition both physical
digital
●
Face to Face engagement ●
Age of members
Strengths
The Strength of the company relies heavily on the backs of the customers which is not a shock because every retail pulls the strength from who shops with them. The first strength costco
is successful on and known for is the model of their membership only, they maintain lower cost for their members at a discounted price while purchasing in bulk. They also offer services for their members that will discount other methods within their lives such as life, home and auto insurance and also offer travel discounts. Brings the members to be more loyal because the store is more exclusive to them, since 2014 Costco memberships have steadily grown each year and now sits at 119 million worldwide as of 2022 (Ozbun,2023). Which leads to another strength of Costco involving their customer service and expansion throughout the world, a lot of companies are straying away from focusing on the customers and maintaining the loyalty to the brand of the
people. They are one of the top retails brands not just in the country but in the world, Costco had a brand value of approximately 49.6 billion U.S. dollars in 2022, making it the fifth most valuable retail brand in the world that year (Ozbun, 2023). It was one of the top 4 which included
competition from Walmart and also Amazon, one of the competitions I will be using is Walamart
who is currently the leading retailer in the world as last year in 2022 they generated roughly 573 billion and Costco 195 billion. Although they are not leaders Costco growth around the world has increased each year and is on path to continue increasing by year hoping to reach past 200 billion soon. With their revenue on the rise they put out more warehouses around the world with the stats reading, in just 11 years the number of warehouses operated by the company
has grown by over 200 (Ozbun,2023). With the revenue and warehouse growth it leads to costco other strength to how they provide for their employees , who earn high pay and receive training that will be helpful in the workforce and towards better relationship to members. My last strength involves the competitive edge Costco keeps in order to maintain the low cost on products by
viewing and looking at competitors prices, they also offer their own brand products and organic products their competition does not carry. Weakness
The first weakness I noticed with Costco is that there is no ability to order online with no way to pick up your orders. Other retail stores have the ability to order products online and have it ready for you to be picked up upon arrival, competitors like Walmart, amazon and BJs all have
that ability. Now Costco has remained competitive through online by implementing online ordering by delivery the program has the ability to do same or two day delivery. Delivery usually
has a fee unless it's an order made over $75, the problem lies with the inability to provide in store
pick up as other stores like Walmart focused on pickup of online grocery orders at outdoor stations at its stores. Amazon has in-store pickup at Whole Foods stores (Kaplan,2018). The second weakness involves the company only having a few ways to make in store purchases which is by cash, personal checks and all visa cards only, because they developed a partnership with Visa other payment cards such as mastercards, AMEX and discover can not be used. Through CostcoGrocery which is the delivery service discovery and mastercard can be used but it is only able to be used online or through the app. Costco gift cards can be used as a workaround for using other credit cards for purchases (Johnson, 2023). Part in my service can introduce a new way to pay but in increments in a buy now, pay later. Walmart and other retailers have a partnership with companies like Affirm to set up a payment plan but its not their own. The last weakness for Costco is there no advertising plan they have always stuck by, in which it does save the company roughly around 2 percent yearly on not advertising (Taylor, 2019) it is viewed as evil by the current CEO of the company because of how much money is put
into advertising. So when you really look at it, Costco does no commercials or outside
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