Costco this week rolled out its highly anticipated exclusive shopping hours for Executive Members, giving the warehouse giant’s highest-paying customers a compelling new reason to justify its $130 annual membership fee. The new policy, which soft-launched in June but went into effect more broadly on Sept. 1, lets Executive Members access Costco warehouses one hour earlier than regular shoppers during weekdays and Sundays, and 30 minutes earlier on Saturdays.
The move represents a calculated gamble by the retail powerhouse to reward its most valuable customers while potentially driving upgrades from its base-tier Gold Star members, who pay $65 annually. Executive Members already receive 2% cash back on purchases up to $1,250 annually, but the early-access perk adds a tangible benefit that addresses one of Costco’s most persistent customer complaints: overcrowded aisles and lengthy checkout lines.
Executive Members drive disproportionate value
Costco’s decision comes at a time when the company is demonstrating robust financial health. The retailer generated $254.45 billion in revenue in 2024, marking a 5.02% increase from the previous year’s $242.29 billion. The company’s stock has delivered solid returns for investors year to date, over 5% as of midday Thursday, with shares trading approaching $960 compared to $910 at the start of 2025, demonstrating resilience in a volatile market environment.
The numbers behind Costco’s Executive Membership strategy are striking. While Executive Members account for approximately 47% of Costco’s total membership base, they generate 73% of the company’s sales. This outsize spending power explains why Costco is willing to invest in perks that cater to these premium customers.
With nearly 80 million total paid members worldwide as of the most recent quarter—a 7% year-over-year increase—Costco’s membership fees alone generated $1.24 billion in quarterly revenue.
Costco’s enhanced Executive perks come as competition in the warehouse club sector heats up. The company currently commands 54% of combined visits among the three major warehouse clubs, with Sam’s Club capturing 36% and BJ’s Wholesale Club taking nearly 10%. However, Costco’s dominance is more pronounced when measured by market share, with the company holding an estimated 77% of the warehouse club industry, according to CSIMarket data.
Sam’s Club, owned by Walmart, has been aggressively pursuing Costco customers with promotional membership pricing, recently offering new memberships for as low as $30. BJ’s Wholesale Club has also been expanding rapidly, and visits are growing to its stores. Costco also faces challengers like Amazon, particularly its expansion into groceries, as well as Walmart, whose annual revenue of more than $680 billion dwarfs Costco’s $254 billion.
Strategic implications
Costco’s early-access benefit for Executive Members represents more than a customer perk—it’s a smart application of behavioral economics. By leveraging exclusivity and loss aversion, Costco creates perceived value that can justify the $65 premium between membership tiers. The strategy particularly targets time-conscious shoppers who value convenience and are willing to pay for it.
Industry analysts suggest the move could accelerate Executive Membership conversions, particularly as Costco continues to expand services like same-day delivery credits and enhanced travel benefits for premium members. The company’s 93% membership renewal rate in the U.S. and Canada—among the highest in retail—provides a solid foundation for testing such loyalty-enhancing initiatives.
For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.