Shopping at Costco can be confusing or a dream, depending on whom you ask. The enormous warehouse stores can be daunting to navigate, and it can be somewhat tricky keeping track of what you absolutely should buy at Costco and what you should avoid.
What isn’t up for debate is Costco is a retail leader that gets high marks for customer satisfaction. Here are eight things Costco does that puts it at the head of the pack when it comes to customer service, according to the American Customer Satisfaction Index.
1. Service in plain sight
Navigate to the Costco website, and you’ll find something that not every website displays: customer service information front and center. Well, actually, the customer service information is at the top and on the right, but the point is it’s not buried in some hard-to-find corner of the site. If you have questions about membership, online orders, shipping, or returns, the information you need is right there at your fingertips.
2. Today’s managers were yesterday’s cashiers
The men and women managing your local Costco warehouse most likely started out ringing up your jars of pasta sauce, vitamins, and Kirkland jeans. Brian Woolf of the Retail Strategy Center estimates that 76% of Costco warehouse managers started out as hourly employees, meaning they have been on the frontlines and understand the importance of keeping customers happy.
3. They know what they’re selling
Despite the immense size of your typical Costco warehouse, the average number of items in stock is much lower than that of your closest Target or Walmart. A Costco will stock fewer than 4,000 items, whereas the typical grocery store will have 30,000 or more.
This allows Costco to negotiate for lower prices and ensures the employees on the floor know exactly what they’re selling, making it easier for them to handle customer questions and confidently provide an answer. As American Customer Satisfaction Index managing director David VanAmburg told CNN, “[Costco] has that model of, this is what we do, this is who we are, what we sell and we are going to do it really well.”
4. Keeping employees happy
Costco is near the top of the list of the Fortune 500, but it didn’t get there by cutting corners when it comes to wages. The average wage for a cashier’s assistant is close to $13, according to Glassdoor.com. Paying workers something close to a living wage helps ensure employees are more willing to do what it takes to make sure the company runs well. When people enjoy coming to work, it can lead to a friendlier employee and a better customer experience.
5. Customer service without the runaround
Try getting your cable company to give you a straight answer about your bill or changes to your service, and you might need to take a day off work to complete the call. Contrast that with Costco, where if you need to make a call about an order or raise an issue you’re likely to get straight talk and real answers. The transparency and honesty of the process is a welcome breath of fresh air for Costco customers.
6. Retaining employees
Part of the reason Costco is a favorite among shoppers has to do with great customer service. That starts with happy employees — and not only having happy employees but employees who realize how good they have it. Employee turnover at Costco is about half of what it is at Target or Walmart. Workers at Costco tend to feel they are truly a part of a team in which every member is making the entire group successful.
7. Keeping quiet on the marketing front
Because it has a small number of items in its inventory and sells stock at a low margin, Costco doesn’t advertise. It doesn’t have to. Aside from rotating seasonal stock, customers know what to expect to find when they walk in the door at Costco. Only a fraction of Costco’s operating costs go toward advertising, so shoppers aren’t bludgeoned with an onslaught of mailers and coupons that can make the head spin.
8. Shoppers get affordable snacks
For the shopper who goes overboard and spends hundreds of dollars in one trip, relax — Costco has you covered. Sort of. The food court in the front of the store has prices that can’t be beaten. A hot dog goes for just $1.50, a cup of soft-serve ice cream is less than $2, and a mammoth slice of pizza is less than $5. The prices on those items have remained the same for years, providing true value to regular Costco shoppers. The hot dog is so popular that it has its own website.