Costco swot presentation final

Kramer Cirineo, Megan Schmitt, Mia Patterson, Andrew Ulstad & Carlos Vega-

Garcia

“Simplifying Home and Life”

Who is Costco?Leading wholesale membership retailer112,000 employees$112 Billion in revenue (Aug. 31, 2014)Business to Business, Business to Consumer,

Business to Consumer to Consumer

"To continually provide our members with quality goods and services at the lowest possible prices”

Future of Costco

Where are we now?

Current Target Audience(s): Families Middle and Upper Class One-stop shoppers

Where are we going?

Future Target Audience(s): Students Young Adults (age 20-25)

StrengthsMemberships

Employee treatment

Multi-purpose

Pricing

Reputation

One-stop shop

WeaknessesLimited warehouses

Not in the millennial market

Minimal on social media

Limited store hours

Limited number of products to offer

Required memberships

OpportunitiesAdvertisement / promotions

Expand payment methodAmerican Express

Expand store hours

Nonmembers purchasing of alcohol

Public Relations team

Threats Limited selection

Financial record falls short of standards

Economy

Amazon: delivering groceries

Varying gas prices & stations

Sam’s Club, BJ’s, Walmart, Target, etc.

Memberships

Number of memberships: 72 million One third are Executive

members

$2.29 Billion in revenue from memberships alone (2013)

Business Member = $55

Gold Star Member= $55

Executive Member = $110

Membership fees allow Costco to maintain low margins

Propose: Student Membership at 30-40 percent discount from Gold Star Membership

Current Media Practices: Owned

Owned Media Facebook

1,211,921 Likes760,175 Visits

Website Intranet Propose: Twitter & Blog

Current Media Practices: Earned

Earned Media Promote CSR

Education ChildrenHospitalsNonprofits

Propose: Marketing to Millennials & College Students

Current Media Practices: Paid

Paid Media In store:

CouponsMemberships

Propose: Continue current techniques with coupons & memberships

Proposal Increase Owned Media

Usage Implement Twitter and

Blog account

Expand Membership Outreach Add new membership

option (30-40 percent from Gold Star)

Millennials College Students

Budget What is the cost of

this proposal?

Employees: 2 employees: $51,520** 1 employee: $25,760** 40 hours/wk. $11.50/hr.

**price based on 40 hours/week for 56 weeks

Duties: $ Varies Blog, Twitter & Facebook Millennial Research

($500) Guerilla Marketing ($500) Equipment ($500)

TOTAL COST (Year) 1 employee: $27,260 2 employees: $53,020

Financials Based on 2014

Top Line $112.64 Billion

Bottom Line $14.18 Billion

Bottom Line Less Proposed Budget Will still remain above

$14.1 Billion based on previous statement

Projection: Increase in Revenue(s) due to the addition of the fourth membership option will pay for the employee(s)

“Unless you try to do something beyond what you have already mastered, you will never grow.”

– Ralph Waldo Emerson