Technology is permeating virtually every aspect of people’s daily lives. From paying for the bus directly with your smartphone to buying tomatoes by scanning a code without contact with a cashier at the supermarket. Now, Costco has tested technology to optimize checkout speed and the overall shopping experience, and has confirmed that the changes are permanent. These changes will focus on streamlining the flow of customers entering the store and checking out, and protecting the membership system, the true heart of its value proposition.
Unlike other retailers, Costco is opting for a more gradual approach by conducting trials in its stores
Costco CEO Ron Vachris has stated that “it’s not about technology for its own sake,” referring to the company’s overall vision. He also confirmed that the chain has permanently accelerated its scanning and delivery technology by 20% and extended its operating hours. Furthermore, unlike other retailers that announce massive technological transformations, Costco is opting for a more gradual approach by conducting trials in its stores. In other words, they are making changes gradually, allowing customers to adapt slowly.
“The changes are centered on increasing customer loyalty, boosting sales, and improving the efficiency”
The fact is that Costco continues to make steady progress in digitizing the in-store experience, staying true to its philosophy focused on improving operational efficiency by enhancing the customer experience. “Our digital vision at Costco is to offer a seamless experience that builds trust and loyalty with our customers, both in the warehouse and online,” explains Vachris. Essentially, “the changes are centered on increasing customer loyalty, boosting sales, and improving the efficiency of our operations so we can market products at the lowest possible price,” according to the supermarket giant.
The scanning system doesn’t eliminate the traditional checkout, but it significantly reduces the checkout bottleneck
Costco has already begun implementing its new digitization policy. One of the recently launched trials is the pre-scanning of products by employees using handheld devices. In addition, to support its innovations, Costco has upgraded its online digital customization capabilities. The scanning system, observed in several high-traffic stores, doesn’t eliminate the traditional checkout, but it significantly reduces the checkout bottleneck, especially during peak hours.
The new technology offers recommendations for more relevant products based on recent search history
According to Costco, the company doesn’t intend to replace people with technology, but rather to empower them with tools that multiply their efficiency. In addition to what was explained above, the new technology offers recommendations for more relevant products based on recent search history. This is because, in this model, a member of the store team approaches members in the checkout line before they reach the register and scans the items in their cart, making the final payment process virtually instantaneous.
This comes in addition to the fact that increased traffic to Costco’s website and app
Another digital implementation at Costco is a new digital membership scanning system, supported by the official Costco mobile app and corporate mobile devices used by employees at store entrances. This comes in addition to the fact that increased traffic to Costco’s website and app coincides with investments in Costco’s digital operations, according to Retail Dive.
In terms of figures, net sales increased 8.2% year-over-year, reaching $65.98 billion. From the customer’s perspective, these innovations translate into a smoother and more predictable experience. However, the company must also consider implementing these policies with a degree of inclusivity for senior citizens and people with disabilities, as the same ease and efficiency are not available to everyone.