Costco Fine-Tunes Marketing

DAVID ORGEL

COLORADO SPRINGS — Costco Wholesale Corp. is balancing the need for local marketing with the realities of its low-cost mission, said Tim Rose, senior vice president of food and sundries.

Tim Rose

Speaking here last week at the Grocery Manufacturers Association Executive Conference, he said Costco is able to pick its spots in executing local marketing.

“We've been fine-tuning selections based on demographics, ethnicity and other factors,” he said. “For example, in California our selection is different in Orange County vs. Los Angeles County.”

However, he added, “It's a fine line if we want to continue to be the low-cost operator. So we're being selective and disciplined. We know the makeup of the world is changing so we must at least be in line with that.”

He said the economic downturn hasn't stalled Costco's ability to expand. The company now operates 572 units worldwide.

“The really good companies grow market share in tough economies,” he said. “We've continued to expand and bring new things to members.”

Rose also urged suppliers at the conference to continue to “look at your products and upgrade” while keeping prices in line with user expectations. He said that while Costco has taken a big stance with private label, “we know that major brands will always be what Costco is about.

“We want to keep surprising members with our treasure hunt atmosphere. That's how we differentiate vs. the competition.”