Wait a second!
More handpicked essays just for you.
More handpicked essays just for you.
4 segmentation based marketing of costco
Costco marketing model
Costco's business strategy
Don’t take our word for it - see why 10 million students trust us with their essay needs.
Recommended: 4 segmentation based marketing of costco
Marketing strategies of Costco Wholesale
By: Dilpreet Singh
ID:C0708399
Submitted to- Sisay Abebe Figure 1: (htt)
Introduction
Costco is a wholesale company which provides their members with low and best prices, better quality and it has hundreds of warehouses in the whole world. It deals in various types of products like electronic devices, housing needs, food products etc.
It provides a variety of products but it choose products on the basis of quality, price and brands in order to provide better satisfaction to its customers. Moreover, the reason behind the success of Costco Wholesale is the effective marketing strategies of the Costco Wholesale company. (m.costco.com, n.d.)
Marketing Strategies of Costco Wholesale
Multiple products and brands:
It provides products of different varieties.
…show more content…
The company has many warehouses and stores in the so many countries such as Canada, USA, United Kingdom, Mexico and many more in the whole world.
Weakness-the weakness of the Costco is slow growth of private labels which means that company has their own level on products and the sale of that products are very less and company earn less profit in their own private product . So, company is now focus on this weakness
Opportunity-Moreover, the company gives also increase the sale of company through the online market. People like to do shopping online on internet these days. So, company increase their online services and created interactive online page so that more people attracted towards the company.
Thread-these days there are so many threats to the company like increasing retail rental rates which increases the expenses of the company and increase in the interest rates in US affect the company and company suffers lot due to these problems.
The weakness portion of this analysis gives attentions to things that should change in order to enhance the overall operations of Ulta. Taking a closer look at things that may be hindering the overall sales and potential for further
Threat of substitutions: In Porter’s model he refers to the threat of substitutes that companies face every day. When more substitute products become available to the public, the price elasticity of that product increases because customers now have more options. Once more substitutes begin to enter the market the demand for a certain product will become more elastic. If multiple other companies were to make substitutes that competes with ALDI’s product, then ALDI’s total profit would decrease because the demand for their product would decrease.
American Eagle Outfitters (AEO) differentiates from its competitors because it’s a leading global specialty retailer offering latest trends that are high-quality and affordable. The source of competitive advantage is the quality of their clothes and their environmentally friendly fabrics. American Eagle Outfitters is a high-quality and inexpensive brand of their two competitors Aéropostal and Abercrombie and Fitch. AEO centers in every category of purchaser such as kids, tweens, teens, and adults. American Eagle Outfitters has further stores open globally and their product line is more assorted than its competitors and its name brand and logo is known world-wide.
Costco Wholesale Corporation was an uncommon type of retailers called wholesale clubs. These clubs differentiated themselves from other retailer by requiring annual membership purchase. Especially in case of Costco, their target market is wealthier clientele of small business owners and middle class shoppers. They are now known as a low cost or discount retailer where they sell products in bulk with limited brands and their own brand. The company is competing with stores like Wal-Mart, SAM’s, BJ’s, and Sears.
Product: Costco doesn’t have a lot of product options, with usually only a few different types of the same product. But they offer a huge variety of products as they aim to be a one stop shop for everything the consumer needs. They also offer a variety of services such as photo printing services, car rental, and even life insurance.
Let start with Costco. Costco is Wholesale, Retail Corporation which operates an international chain of membership distribution centers that provides quality, brand name merchandise at noticeably more affordable rates than a conventional wholesale or retail sources. Costco 's warehouses display the largest and great product categories such as groceries, candy, appliances, television and media, automotive supplies, tires, toys, hardware, sporting goods, jewelry, watches, cameras, books, house wares, apparel, health and beauty aids, tobacco, furniture, office supplies and office Their ability to distribute the cut rate from their operating proficiencies in supply chain management and cash flow, permits them to offers items at discounted rate and a lower price than their competitors. For Costco the meaning of being the low-cost provider while also differentiating from the competitors is ambiguous at best. Costco’s CEO, Jim Sinegal, is certain that low priced, and the high value merchandises are exactly what is needed maintain and achieve a staying power in the industry.
The company had to be the second largest retailer shop in the US; it has many advantages that come along. The customers well acknowledge the company and its brand have been well established.
This essay describes how Costco has undergone evolutionary changes from its inception to present through its value chain model to become a success story. For example, in its distribution system, Costco utilizes the cross-docking technology to help in the conveyance of products in the different locations. This ensures that there are no product delays in the respective markets (Guo, 2016). Accordingly, Costco can attract more customers who prefer the warehousing services provided by the company.
In the warehouse segment, Wal-Mart’s Sam’s Club competes harshly with Costco. Costco has fewer warehouses but greater sales and revenues. Costco customers also shop at Costco more frequently than Sam’s Club customers and, on average, spend more each visit as well. Costco’s dominance may be the result of better innovation. Costco offers luxury items and was the first to sell fresh meat and produce, and gasoline. This is important because innovation is a key factor in assessing competitors in an industry.
Costco has many competitors with the primary two being Sam’s Club, a wholesale business being managed by Walmart, and BJ’s wholesale club. Sam’s Club is offering the same services as Costco. They offer their customers lower prices than traditional stores and like Costco they sell their products in bulk to keep members interested. What makes them a threat to Costco is the cost of becoming a member to shop at their stores. For Costco’s basic membership, known as a Business membership, a price increase had to occur to outweigh price increases from their suppliers. This led to the Costco Business membership annual fee being set at $55. When looking into the case study assembled by Thompson, Peteraf, Gamble, and Strickland (2014) they point out that Sam’s Club is able to offer similar benefits ...
Physically fit and active, well-educated, in the upper to middle class, women who are conscious about their appearance, aged between 16 and 45, residing in North America are the current primary target market of Lululemon.
Wal-Mart’s primary competition in US includes department stores of the likes of Target and Kmart. Costco offers competition to Sam Club format of Wal-Mart. In niche small markets, dollar stores are offering strong competition to Wal-Mart.
Around the world they have 3,100 stores. Most of the stores are in Germany, United Kingdom, United States, France, Spain, and Sweden. The stores are in every continent.
The brand (and sub brands – Figure 1) currently has about 96,000 employees and there are stores in 44 countries around the world. They’ve recently announced
Carrefour's background Carrefour was founded in France in the year 1959 by two families Fournier and Defferoy. Carrefour in other words intersection is interpreted as a junction of two streets crossing each other. The name hence resembles the convenience of shopping at Carrefour. " Two wholesaler families merged/combined to form a company from Normandy, which then was managed by Leonor Duval Lemonnier and Paul Auguste Halley. "(Carrefour,2013).