Costco has long stood apart in the world of retail, thanks to a business model that flips the traditional playbook.
Instead of relying heavily on product markups, Costco generates a significant portion of its profits from membership fees, allowing the company to keep prices low and build intense customer loyalty.
That formula has helped Costco cultivate one of the most devoted customer bases in all of retail.
The company recently reported membership renewal rates of roughly 92% across the U.S. and Canada. And during its last quarter, Costco took in $1.36 billion in membership fee income.
But one thing that truly helps Costco shine is being able to blend value with habit.
For many households, a Costco trip isn’t a weekly event. Rather, it’s something you do occasionally to load up on bulk items.
But Costco’s latest earnings call suggests that more members are incorporating store visits into their regular routines. And that’s a definite win.
Costco members are shopping more often
Costco is seeing a meaningful shift in how members come in to shop.
“Traffic, or shopping frequency, increased 3.1% worldwide,” CFO Gary Millerchip told investors during the company’s most recent earnings call. Millerchip also confirmed that the average transaction, or ticket, was up 4.2% worldwide.
Related: Costco quietly made changes to Kirkland Signature brand
That increase in visits is significant because frequency is a key driver of long-term growth for Costco. The more often members walk into a warehouse, the more opportunities the company has to capture incremental spending.
Another thing that makes Costco so unique is its treasure hunt-style shopping experience.
At most big stores, customers can walk in every week knowing what to expect. At Costco, the inventory is constantly changing. That makes a Costco run more exciting.
A big reason Costco has long resisted benefits such as curbside pickup, which rival Sam’s Club offers, is that the company wants members to enter the store. Costco is pretty convinced (and rightfully so) that once members walk in the door, they’re more likely than not to spend more than expected because they’re so enticed by the selection of products.
The fact that shopping frequency has increased is therefore a very positive thing for the company.
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How Costco can turn more visits into bigger sales
More frequent visits are a strong signal for Costco. But in the coming months, it could benefit Costco to shift slightly away from its treasure hunt-style experience and focus more on core value and essential needs.
The treasure-hunt approach hinges on consumers having the money for impulse buys. But in today’s economy, that may not be the case.
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In February, inflation rose 2.4% on an annual basis, according to the Consumer Price Index. Food costs as a whole saw an even bigger increase — a 3.1% jump year over year.
Meanwhile, in early 2026, only 12% of working Americans said their paychecks have kept up with inflation, according to a report by Resume Now. And 92% of workers have cut back on spending, including essentials like groceries.
What Costco really needs to do to maintain its momentum is hone in on essentials at a time when customers may be more likely to buy a lower-cost item like cereal on a whim, rather than apparel or home goods.
Thankfully, Costco can lean on its Kirkland Signature brand to adjust to consumer behavior. The brand is synonymous with quality. Even better, because Costco maintains such heavy control over pricing, it can offer customers relief at a time when costs are so high.
Ultimately, Costco’s ability to drive both loyalty and habit remains its biggest competitive advantage. And with members now visiting more often, Costco is well-positioned to turn that momentum into sustained growth at a time when many retailers are seeing sales decline.
Maurie Backman owns shares of Costco.
Related: Costco makes a key investment to help members
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