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I have their CC shop there every now and again. Don't most stores either do this themselves or sell the data to bigger data brokers? Not saying its not an evil

I have their CC shop there every now and again. Don't most stores either do this themselves or sell the data to bigger data brokers? Not saying its not an evil practice in general, but their actions don't seem to be an outlier?

smeej 2y ago
Just about everyone does, and has for the decade since store "rewards" cards became ubiquitous. I am stupefied to find out Costco is this late to this party. I don't even like the party, but it makes me worry about their leadership's awareness of...the entire world? Without some principled reason not to have done this sooner, it's just an awfully big ball to have dropped.
- nucleogenesis 2y ago
  I’ve heard anecdotes about Costco’s leadership being principled, especially relative to what you’d expect from corporate execs. I may be misremembering but iirc during a call with investors they were asked why they hadn’t been raising prices like everyone else is and the response was basically “because we don’t need to, so we won’t screw people over just because we can”.
  - mrguyorama 2y ago
    Eh, they probably aren't that principled, but rather they are just very aware at what their brand is. Costco makes it's money on people thinking the big business loves them as they pay $40 for a bottle of turmeric pills, while the gallon jug of turmeric costs $20. Meanwhile Costco's entire business is based around negotiating a large profit cut for name brands, and letting the consumer in on a tiny percentage of that profit cut. For most things, Costco isn't even that significant a discount anymore. There's the famous story of the Founder in a meeting supposedly telling the CEO "If you increase the price of the hot dog I will fucking kill you" If this actually happened, it's because the CEO knows that the $1.50 the hotdog costs is essential to the brand, and not because he has any belief about how much a hotdog should cost.
- ethagknight 2y ago
  Check out Costco’s stock performance over the last 10 yrs, compare to Target, Kroger, Walmart, let me know which you would rather have owned. Hard to complain about dropping a ball while wildly outperforming their competitors. Maybe selling user data to third parties is a short term profits at the expense of long term strategy?
  - smeej 2y ago
    I think they're kind of damned if they do, damned if they don't now, from my perspective. If they had a principled reason not to do it, I'll think less of them for doing it now, and if they don't, I'll think less of them for not doing it as soon as possible, since they can't go back in time and do it sooner. Granted, they probably don't care at all about my opinion, and they shouldn't, given that I'm one random person who doesn't live near a Costco and doesn't have the space to store bulk purchases for one even if I did. I just think making this choice now reflects badly on them either way.
    - ethagknight 2y ago
      You missed the point. They’ve been an order of magnitude financial out-performer compared to their main comps without it. Sell your customer data, and you give your suppliers and competitors your insider info and competitive advantage. I would assume whatever they are building is focused on protecting their customer info, not based on principle but simply on… that’s their treasure trove.
      - smeej 2y ago
        This is the "damned if they do" side. I don't care what the principle was that kept them from doing it. "We'll make more money over the longer run if we don't do it" is a totally valid principle in my book. But if that's the case, then I'm looking down on them for throwing that away in favor of short-term gain now. Unless they can point to something specific and say, "Our reason was X. Now Y has happened, which makes X now an inferior strategy to Z, so we're doing Z now," they either should have done it sooner or shouldn't do it now. I don't see anywhere they're pointing at any Y that has happened.
enragedcacti 2y ago
It's definitely not uncommon but Costco has a reputation for being pretty pro-consumer so many probably find it surprising. As far as I'm aware Trader Joe's is the only big US chain not selling customer data at this point.
- blinded 2y ago
  I wonder if they have a "no collection" deal with citi their CC provider?

smeej 2y ago

Just about everyone does, and has for the decade since store "rewards" cards became ubiquitous. I am stupefied to find out Costco is this late to this party. I don't even like the party, but it makes me worry about their leadership's awareness of...the entire world? Without some principled reason not to have done this sooner, it's just an awfully big ball to have dropped.

nucleogenesis 2y ago
I’ve heard anecdotes about Costco’s leadership being principled, especially relative to what you’d expect from corporate execs. I may be misremembering but iirc during a call with investors they were asked why they hadn’t been raising prices like everyone else is and the response was basically “because we don’t need to, so we won’t screw people over just because we can”.
- mrguyorama 2y ago
  Eh, they probably aren't that principled, but rather they are just very aware at what their brand is. Costco makes it's money on people thinking the big business loves them as they pay $40 for a bottle of turmeric pills, while the gallon jug of turmeric costs $20. Meanwhile Costco's entire business is based around negotiating a large profit cut for name brands, and letting the consumer in on a tiny percentage of that profit cut. For most things, Costco isn't even that significant a discount anymore. There's the famous story of the Founder in a meeting supposedly telling the CEO "If you increase the price of the hot dog I will fucking kill you" If this actually happened, it's because the CEO knows that the $1.50 the hotdog costs is essential to the brand, and not because he has any belief about how much a hotdog should cost.
ethagknight 2y ago
Check out Costco’s stock performance over the last 10 yrs, compare to Target, Kroger, Walmart, let me know which you would rather have owned. Hard to complain about dropping a ball while wildly outperforming their competitors. Maybe selling user data to third parties is a short term profits at the expense of long term strategy?
- smeej 2y ago
  I think they're kind of damned if they do, damned if they don't now, from my perspective. If they had a principled reason not to do it, I'll think less of them for doing it now, and if they don't, I'll think less of them for not doing it as soon as possible, since they can't go back in time and do it sooner. Granted, they probably don't care at all about my opinion, and they shouldn't, given that I'm one random person who doesn't live near a Costco and doesn't have the space to store bulk purchases for one even if I did. I just think making this choice now reflects badly on them either way.
  - ethagknight 2y ago
    You missed the point. They’ve been an order of magnitude financial out-performer compared to their main comps without it. Sell your customer data, and you give your suppliers and competitors your insider info and competitive advantage. I would assume whatever they are building is focused on protecting their customer info, not based on principle but simply on… that’s their treasure trove.
    - smeej 2y ago
      This is the "damned if they do" side. I don't care what the principle was that kept them from doing it. "We'll make more money over the longer run if we don't do it" is a totally valid principle in my book. But if that's the case, then I'm looking down on them for throwing that away in favor of short-term gain now. Unless they can point to something specific and say, "Our reason was X. Now Y has happened, which makes X now an inferior strategy to Z, so we're doing Z now," they either should have done it sooner or shouldn't do it now. I don't see anywhere they're pointing at any Y that has happened.

enragedcacti 2y ago

It's definitely not uncommon but Costco has a reputation for being pretty pro-consumer so many probably find it surprising. As far as I'm aware Trader Joe's is the only big US chain not selling customer data at this point.

blinded 2y ago
I wonder if they have a "no collection" deal with citi their CC provider?