Costco is the new Netflix. The popular warehouse store has recently announced some changes in its current card-sharing practice.
To combat the anomalous use of membership cards, the company will require the members to present their ID at checkout as part of the verification process.
Costco Implements Stricter Card-Sharing Policy
According to a report by Gizmodo, Costco has urged those with membership cards not to share them with anyone, even if it's their friends or family.
Having said that, if a Costco member fails to obey the new policy, he/she might be denied before making a purchase. The company has not yet confirmed when the new policy will take effect.
Before, members were not required to present their cards at the register. With Costco's plan to crack down on the malicious card-sharing practice, it will now require even those who have a membership card, particularly those that do not have a photo.
A spokesperson for Costco explained that membership cards are strictly meant for individual use and are not transferable.
The company's decision to tighten the rules was prompted by the observation that non-members were utilizing membership cards that did not belong to them, particularly with the expansion of self-service checkout options.
Unfair Membership Card Sharing
Costco relies on membership fees to offset operational expenses, enabling them to offer competitive prices exclusively to its valued members. Therefore, it is considered unfair for non-members to enjoy the same benefits and pricing privileges.
It is worth noting that Costco has maintained its membership costs since 2017, remaining competitive in comparison to rival warehouse store BJ's while surpassing competitors like Amazon and Walmart's Sam's Club, which have implemented membership fee increases.
Although there have been hints of potential price adjustments, the current standard membership fee remains $60, with an upgraded executive membership option available for $120.
Across the United States, Costco says that nearly 125 million have membership cards, serving almost 70 million households as of June 22.
On top of that, the company said that in 2022, it achieved a revenue of $222.7 billion-a spike of 9% from 2021.
"The extent to which we achieve growth in our membership base, increase the penetration of Executive membership, and sustain high renewal rates materially influences our profitability," Costco mentioned in its annual filings, per CNN.
Costco Shares Netflix's Password-Sharing Crackdown
Costco's initiative to address card-sharing practices is reminiscent of Netflix's recent efforts to tackle password-sharing among users residing in different households.
In a bid to protect their business interests, Netflix informed consumers that their accounts are intended solely for personal use within their own households. Consequently, the streaming giant introduced an additional $7.99 charge for adding an extra member to an account.
