about 21 hours ago

Costco Enhances Executive Membership Value with Early Store Access

Costco Wholesale Corp. $COST has introduced a new perk aimed at reinforcing its premium Executive membership tier. Beginning this summer, Executive cardholders paying $130 annually will gain access to warehouses starting at 9 a.m.—one hour earlier than standard Gold Star members, who pay $65. The decision follows the company’s earlier move to extend operating hours at its gas stations across North America.

The announcement arrives shortly after CEO Ron Vachris highlighted “exceptionally positive” customer feedback on fuel service enhancements during Costco’s earnings call on May 29. The company reported record fuel sales in two consecutive weeks in the U.S., driven by longer pump hours, new station openings, and competitive pricing.

Strengthening Customer Stickiness Through Benefits

The new early-access policy is part of a broader strategy to deepen engagement with Executive members, who disproportionately drive Costco’s revenue. Despite accounting for less than half of the company’s membership base, Executive members generated 73% of total sales, according to internal figures. This suggests Costco’s most loyal customers are also the most profitable. By offering time-sensitive incentives, the retailer strengthens loyalty while managing in-store traffic more efficiently.

Recent Member-Centric Enhancements

Costco's layered approach to benefit expansion reflects a clear focus on operational scalability and customer retention. Recent enhancements include:

Extended gas station hours to capture commuter traffic and build fuel loyalty;
New fuel stations in strategic locations to support member convenience;
Price leadership at the pump, reinforcing Costco's value proposition;
Early warehouse access for Executive members to reduce peak-hour congestion;
Strong communication of benefits through earnings commentary and digital channels.

Revenue Composition Reinforces Tiered Model

As of the latest disclosures, Costco had 79.6 million paying members. Of these, 37.6 million hold Executive status. This segment continues to generate outsized value, underscoring the efficacy of Costco’s tiered loyalty structure.

The timing of this perk rollout also suggests a preemptive response to rising competition in the warehouse retail sector. With rivals expanding digital and delivery offerings, Costco is doubling down on in-store advantages that drive traffic and recurring spend.

Implications for Investor Sentiment

Enhancing Executive membership aligns with Costco’s long-term margin defense strategy. By incentivizing the premium tier, the company improves average revenue per member while keeping churn rates low. Additionally, expanded gas services act as a high-frequency entry point into broader Costco purchases.

These developments support sustained foot traffic growth, operational leverage, and higher sales per visit—metrics closely watched by investors. While not transformative alone, the policy bolsters Costco’s moat in a low-margin, high-volume business model.