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Warehouse Club Secrets: How They Make You Spend and How You Can Save

The Ultimate Impulse-Buying Environment
Shopping at wholesale clubs
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Tim Marrs

Yet in the greater scheme of things, I don't begrudge Costco anything. They are in business to make money, and they're very, very good at it. Their psychological tactics are most readily apparent in the store's floor plan. As you enter you're forced through a gauntlet of their highest-priced items clearly meant to inspire thinking along the lines of, "They have product X at Costco? This place is amazing!" I have a sneaking suspicion, though, that the flatscreen TVs and swank home theater setups are designed to make me feel poor. It's impossible to walk by a 52-inch television and not fantasize about putting it in my cart next to the detergent. Of course buying a TV would be foolish. I already have several. Still, I suddenly feel poor. Priced out. I rebel against my budget because I'm supposed to spend a lousy $200 on this visit, not $2,000. Stupid budget. Basically, all of this primes me to want to prove to myself that I'm no pauper. And the easiest way of doing that is by taking advantage of the first great, indulgent deal I stumble upon that I can actually afford. (Hence, the Cheez Doodles.)

The rest of the store's floor plan seems explicitly designed to keep the customer guessing. There are no signs telling you which section stocks what. Nor does there appear to be any logic to the way products are laid out. This leads to another of Costco's signature blends: confusion and wonder. As I encounter footie pajamas next to the produce, and deep fryers by the breakfast cereal, everything seems plausibly useful, not extravagant. Each item is completely decontextualized, making it difficult to get your bearings, price-wise, on any individual item. You have nothing to compare it to. Look how cheap these Honey Nut Cheerios are compared to this deep fryer. Sold!

In short, Costco has created the ultimate impulse-buying environment. Only instead of dropping a dollar on chewing gum at the cash register, I'm picking up a 20-pack for $10 (which is, naturally, an amazing price).