Core Insights - Costco's Executive Membership offers significant savings through a 2% cashback on purchases, making it financially beneficial for members who spend over $3,250 annually [4][5][6] Membership Structure - Costco provides two membership options: Gold Star Membership at $65 and Executive Membership at $130, with the latter offering additional benefits [4] - Executive members earn a 2% cashback on most purchases, capped at $1,250 per year, which can offset the higher membership fee [11] Financial Performance - Membership income grew by 7.3% year-over-year, driven by an increase in membership base and upgrades to Executive Membership [8] - As of the end of Q1, Costco had 39.7 million paid Executive memberships, a 9.1% increase from the previous year, contributing to a total of 81.4 million paid members [9] Renewal Rates - The renewal rate for U.S. and Canada members was 92.2%, while the worldwide rate was 89.7%, reflecting a slight decline from the previous quarter [10] Additional Benefits - Executive members enjoy early shopping hours, starting at 9 a.m. on weekdays and Sundays, and receive a $10 monthly credit for Instacart or same-day delivery on orders over $150 [18] - Enhanced benefits include discounts on various services such as travel packages and insurance [18] Market Strategy - Costco's strategy focuses on promoting the Executive Membership, which is crucial for its operating profit, with nearly half of its members opting for this tier [7] - Analysts suggest that the exclusive shopping hours may attract more customers to upgrade their membership, although there are concerns about potential alienation of some members [12][14]

Core Insights - Costco has introduced a new benefit for its Executive Members, allowing them to shop one hour earlier on weekdays and 30 minutes earlier on Saturdays compared to regular members [1][2][3] - The Executive Membership costs $130 annually, which is double the price of the standard Gold Membership at $65 [3] - Approximately 50% of Costco's U.S. members hold Executive status, contributing to 73% of the company's sales [4] Membership Benefits - Executive Members enjoy exclusive access to the store during designated early hours, enhancing their shopping experience [1][2] - The membership includes annual rewards and a $10 monthly credit on eligible online orders over $150 [3] - Positive feedback from members indicates that the early shopping hours have created a more relaxed shopping environment [4] Customer Reactions - Initial responses to the new policy have been favorable among Executive Members, with many reporting smoother shopping experiences [4] - Some non-Executive Members and staff have criticized the change, perceiving it as favoritism towards higher spenders [4][5] - The value of the Executive Membership is contingent on individual shopping frequency and spending habits, raising questions about its return on investment [5]