Warehouse club based on Walmart membership, Sam’s Club (WMT) It recently reached all of its members. The message sent lets members know that the club has completed nearly a rolling look at all of its 600 locations. It also mentions that the company is working on improving its own member branding. Additionally, the company has made technical improvements to improve shopper experiences.
The wholesaler primarily focuses on value above all else. In comparison, Sam’s Club is generally less priced than its main competitor Costco (cost) , But not much. So, when it comes to saving every penny while shopping, Sam’s Club wins the prize. Costco’s focus is on the happiness of its members, which isn’t always the lowest price, but it still represents value compared to non-warehouse retailers.
As with any membership organization, Sam’s Club puts a lot of effort into getting members to renew each year. As a payment to get members to sign up, Sam’s Club ran a promotion for a new membership that cost just $8, compared to $45 for a basic membership. Over the years of the pandemic, the club has grown, and members have benefited from reduced fuel prices for clubs while prices have gone up.
The members take a hit, but Sam eats it
Sam’s Club membership prices have remained steady at $45 for Basic and $100 for Plus members. But on October 17, Sam’s Club card holders can prepare for a basic membership price increase to $50, and Plus memberships will be $110. Sam’s Club CEO Catherine McClay confirmed that this is the first time “we’ve changed the price of Plus membership since it was introduced in 1999, and it’s been nine years since we last changed the price of club membership.”
McClay’s letter to existing members told them that for the first time in nine years, the wholesaler would increase membership prices.
“We are aware of the financial pressures on the portfolios at the moment,” McClay said in August. “So this year’s renewal is upon us. We are returning $5 in Sam’s Cash to Club members and $10 in Sam’s Cash to Plus members shortly after the renewal.” McLay refers to the price increase on renewals as a reward for members to commit to another year of service.
Returning loyal members will be able to use Sam’s Cash on purchases, shortly after membership renews. Sam’s customer refund deal will run from October 17 to October 16, 2023.
Other memberships will pay for the price increase
Sam’s Club members pay more for membership now, but others may pay more soon. Costco’s chief financial officer, Richard Galante, has left speculation about a possible price increase. “Sure, because we’ve historically increased member fees every five or five and a half years, we’ve turned them around and used them to drive more value,” he said.
“And whenever we do that, we’ll do it. I think at the end of the day, it’s — and I also want to point out, of course, if you look at the last three increments, on average, they were five years and seven months apart. If you look at June of ’17, plus To five years and seven months, you’re almost talking about January 23. He continued, “Now I’m not suggesting it’s January 23. I’m just saying it wasn’t there yet anyway. Our point is, are we confident in our ability to do that. And at some point, we will, but it’s a question of when and not if.”
An Amazon Prime membership also increased in 2022 from $119 to $139. The price hike is huge compared to Costco and Sam’s Club.