Comparison Of Sam's Club And Costco

Good Essays
Will millennials kill big box and DIY stores like Sam’s Club and Costco? The answer to that question is up to these stores to change their target market. According to Forbes, their main target market are the parents of millennials. These parents are the “the suburban, car-loving, McMansion-owning” parents who make up 63% of these types of stores customer base. Since the strong customer base is in the suburban areas of the country, these stores are really only in suburban areas because that’s the only place where there is enough land to have these stores. According to the ULI’s survey, 13% of millennials live downtown or near down town, 35% live in city neighborhoods, 13% live in dense older suburbs close to the city (still considered urban),…show more content…
Only 15% of millennials live in the target market areas for these stores, and so that leaves the question when the parents of these millennials get old and no longer need these mass quantities of items, how would these stores stay in business? Like I said earlier, it means these stores need to change their target market and even their products they sell. Sam’s Club offers a gallon of Mayonnaise for $10.98 which is a great deal, but according to, these millennials simply don’t have the kind of room for it because they live in small apartments in the urban areas, or they imply don’t have cars to haul these items to their house, so they go for the less “more bang for your buck option” by buying the standard sized Mayo bottle from a grocery store. These big stores also do not offer a variety of organic options, which is huge in the millennial lifestyle. According to Public Radio Newswire, 40% of Millennials say that it is a must to buy organic styled food. So even if these stores moved to the urban areas to comply with millennials, really only 20% would be interested in the mostly organic-less variety of…show more content…
But that still would not be enough. The main reason these big stores are attractive, is because since they buy in bulk, the store Is able to sell these items a lot cheaper, but If they were to buy in smaller sizing, it would cost more thus bumping the prices up. So basically in order for these big box or DIY stores to survive this crazy millennial generation, they would have to become a smaller store in order to have enough room in the cities, sell smaller sized products so the customers can easily make trips to the store if they have a big SUV, or even car or not, provide a mainly organic food line-up, and still maintain very cheap prices and membership benefits. In essence, these stores would have to become cheaper but just as good of quality if not better versions of a Trader Joe’s and Whole Foods type store. So in my own opinion, as a student in an introductory business class and with my expertise, I believe that millennials will kill off these big box and DIY stores because it just does not seem likely or possible that they would be able to do all the changes to the store while still offering the cheap prices they do now. Maybe they will be able to create smaller supermarkets and hardware stores that still give reasonably cheap prices but they, in my opinion, will not be the same booming stores they
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