Costco sells just the type of staples—paper towels, diapers, laundry detergent—that you don’t need to truly shop for. Most of us buy the same brands in bulk over and over; it was the entire premise behind those Amazon Dash buttons (now discontinued, R.I.P.). So why don’t more Costco customers use the store’s website to reorder those staples? Turns out, few Costco members shop the store’s website at all.
We mined that tidbit from this Yahoo! Finance story about how Costco stacks up against competitors Amazon and Walmart. The piece notes just 18% of Costco’s member order from the company’s website with any degree of regularity, and just 7% have bought food online from Costco. A full 65% have never shopped on the website at all. Most who do shop on the website use it to purchase electronics.
(I know parents who get a box of diapers delivered to their door monthly. And yet, somehow that feels different than 30 rolls of toilet paper.)
Because Amazon is obviously the king of online shopping and doesn’t have many physical outposts yet, we’ll set them aside as not truly analogous to Costco. But take Walmart, a reasonable competitor to Costco: It makes up 22.5% of online grocery orders, compared to Costco’s less than 6%. What is about Costco that deters people from shopping online? It can’t just be the membership aspect. (There are ways around that, too.)
I’m exactly the type of customer whose experience is reflected in the stats above: I shop at Costco in person at least once a month, usually twice, but I’d never even visited the website until I was doing some background research for this Kirkland brand craft beer taste test. In my mind, Costco is a store I visit, not an online retailer. Yahoo! Finance implies this has something to do with Costco HQ’s notoriously lean operation and lack of promotion of the website, but I pin its digital-ordering fail on something else: There are no $1.50 hot dogs in cyberspace.