Same thing happens at all sorts of places. The discount jeweler in the mall loves having Tiffany's there too because it makes people feel good about being able to afford a their less expensive diamonds. IKEA makes you walk near bins of 49 cent stuff after you've seen the furniture so that you get in the mood to buy -they call them wallet openers. Shopping is 100% psychology - behavioral consulting is a HUGE industry.

At Costco
I am a lamb led to slaughter
Baaa
Baaa

It is a basically psychological trick used in many markets. if you get a company to help you find house, they will show you a cheap crappy one, a mid range one and a high end one that you cant afford, this causes you to buy the midrange product they want to sell you.

Restaurants do this also, they all have a very expensive meal that does not seem worth it but since humans like to have a reference or something to compare to. This trick makes their most profitable meal seem like a good deal to the buyer.

Comparisons of even unrelated items help increase the max customers are willing to spend.

Heather uses a lot of "we(s)" in her piece. When I go into Sam's (the other Costco), I know exactly what I want, buy it, and get the hell out.

If lovin' The Co (as we call it), is wrong, I don't want to be right.

Worth the cost of membership for the bags of RiceWorks brown rice chips.

There's really not a whole lot in a typical Costco store that would really be characterized as luxury.

She may be right - but honestly?

They don't need it - Costco has enough deals, and works as a bulk retailer, and bulk retailers (STOCK UP FOR THE RECESSION GUYZ) will always do well, or at least it seems that way.

We found a food service Costco nearish to us - now that's a thing to behold. All kinds of ridiculousness which is generally meant for restaurants and the like, but man are there some yummy things there they don't sell anywhere else.

I work for Costco. We sell those things because people actually buy them. I promise you.

I've sold ten-thousand dollar rings to ladies. One day, a guy comes in and asked when his executive membership rewards roll to the next year because he bought an $80,000 hot rod garage/component kit online and wanted a SECOND one. Then the piano, hot tub, and pool table roadshows come and people wheel the stuff out the door after paying cash. And these are not a once-in-a-while occurrence.

OP has an interesting theory. But if people didn't actually buy these things, we wouldn't offer them.

@Razor512: Also wanted to add, that my family mainly shots at costco because products are cheaper, even though you end up spending more, you are buying in bulk and you spend a lower price per gram when you buy in bulk from costco

Costco in Japan (or "Costaco" as they say it) is truly spectacular. You could transplant a Costco from the US to Japan and not tell the difference aside from the fact that everyone is Japanese and its very crowded. Most items are the exact same as at US Costco, but with a Japanese sticker over the English one.

that may explain something i have been wondering about - when i go to the grocery store, it doesn't affect my blood sugar, even for approximately the same amount of walking around with a cart. but going to sam's or bj's does. i tend to measure it before i go in and right before i get in the car to leave [this started because it was getting dangerously low]
but other hormones, like dopamine and adrenaline cause changes in my blood sugar. so maybe it's all the dopamine of walking past my personal 'want' sections [i want new patio furniture quite a lot right now] that messes me up by the time i leave.

@coren: Is this an actual type of Costco or do you mean a Costco-like store for food service? (just curious)

@psm321:

I am very interested in this as well, as I find Costco is more interested in selling me caskets, tires, kayaks and other useless shit, rather than the foodstuffs I'd like to stock up on!!

A store....SELLING THINGS?!?!?! CONSPIRACY!!!!!

I love Costco, but not all of us dream about how great it would be if our lives were filled with stuff.

I want that. And that. And that.

I know six-year-olds who think that way. Not all of start drooling like goons at the sight of televisions, handbags, shoes and diamonds.

@psm321: While we do in fact, have a Costco-like store (although much smaller) that caters to that sort of thing (it's called Cash & Carry [www.smartfoodservice.com] ) there is also a food service Costco in my area. [www.costco.com]

It's wicked awesome - ginormous tubs of icecream (they have to be five or ten gallon!), all kinds of spices and such, lots of frozen goodies I don't see at other Costcos, giant cookies, tons of those individually wrapped baked goods that little coffee stands sell - it is a thing to behold.

@TheSpatulaOfLove: [www.costco.com] This is the one I'm talking about although I doubt it's the only one. It still has some of the useless stuff, but it's almost entirely focused on catering towards business in the food service industry.

We also have [www.smartfoodservice.com] which at least the locations I've been to is much smaller than Costco, but is also exclusively catering to restaurants and the like. Both are awesome.

@umbriago: That's what I was thinking, do people look at that stuff?
I go straight for what I want, I could care less about the tvs and jewelry.
I'm a bad American for this behavior I have a feeling.

so that's why they put all the TVs, iPods, and cameras in the entrance, and a Verizon section just a few more feet in

@coren:

Aw crap - you left-coasters always get the cool stuff before everyone else!

Thanks for the info - it's good to know this exists. I can now call the customer abuse line and point to something. ;)

@AppleAlex: What, you thought people signed up for Verizon without trickery involved? ;)

@fredmertz: Right at the entrance to all the Costco warehouses I have been in is the display of giant TVs, and near that is a jewelry case.

I looked at my credit card bill for last month, and ignored the one-time expenses (e.g., vacation), and looked at the regular expenses. The stuff like eating fast food 15+ times a month, and paying for allergy medication aren't that big of a deal. The stuff like "let's buy the latest version of OS X," etc., are the budget-killers.

@catastrophegirl: The "current wants" thing affects my Costco trips too. I used to dawdle by the TVs every time I went, but bought a plasma for our christmas gift to each other in '08 and now I don't even slow down for the TVs.

@HiPwr: Sams is NOT the other Costco. Costco is pro union and treats its employees well, pays them decent wages and is generally one of the better corporate citizens in the US.

Sam's Club is wholly owned by Wal-Mart, as in Sam Walton.

Same principle as "halo cars," I guess.

@HiPwr: Well, the majority of people, who are not you, apparently, are probably affected by this. But at least your comment gave me a spot on my BINGO card. Gracias!

@coren: That's in Fife?!? That's it, I'm moving back to Gig Harbor from the 509!

@segfault: Umm, unless you only get 1 item off the dollar menu each time you eat fast food (and drink water with that) I'm guessing you spent a lot more than the $29 cost of Snow Leopard by hitting the fast food joints 15x a month.

I read that article, and all I have to say is, if it is true, I feel bad for people. Now, I took some behavorial psych and I know shops are set up in a certain way, etc.

But if you go to Costco and buy a ton of stuff you don't need, I'm sorry, you are retarded. A plant and a jacket, as described in the article, are not gotcha! items. They are useful. I assume he meant to talk about the people who make impulse buys at costco... I look at the TVs and I bypass them; I have a TV and its fine. I look at the jewlery/watches but IMO the selection is low and its not my style.

The rest of the stuff is pretty not impressive, except for maybe the firepit. In a nutshell, while I love what costco sells, none of it is really "OMG high end I wish I could buy it!"

I then proceed to split 150-300 dollars worth of groceries and stuffs with my roomate, and dont buy any other food for 1-2 months. Maybe I'll get a DVD but thats it.

@segfault: I think you need to redo the math, because I guarantee you fast food 15x a month is a budget and health killer, along with the fact that its a one time return. OSX will work for years, is 29 dollars only, you use it almost everyday, and probably is more enjoyable per dollar than a Six Dollar Double Bacon Cheesburger.

man I just reread my post and it makes no sense. People are dumber for reading it, and I award myself no points.

Can an admin. just delete it?

@catastrophegirl: my BG always shoots up after Costco... but that's because i'm sampling all the goodies they have out. (oh, and what's the status on your navigator order?)

@gStein: i'm allergic to many things to be tempted by samples!
[sent you a request to follow on twitter -i've been keeping track of the insurance issues there. it's getting ugly]

the thing that we've been eyeing for a while isn't in the "expensive-ass stuff" section - it's a bathroom countertop thing that's back by the furniture stuffs, $800 or so. but in order to install it, we'd also have to re-drywall and paint part of the bathroom, get the old counter out, buy a new faucet, sand and refinish the floor (assuming there's hardwood under the other bathroom counter...)

@winnabago: I wouldn't say it's 100% psychology, but it is a pretty big percentage imo. When I go shopping I get the things I want (in a sense kinda what I need), ie, if I go to the mall because I wanted to get a game from gamestop, I usually head straight towards what i want and get it, I pay no attention to the more expensive stuff and then see cheaper stuff and think "Hm, i could afford that". Just like with most stuff it more or less depends on the person. Like I've seen people who have quit drinking, some had a hard time doing so while others just simply decided to stop and there was no kind of mental battle with it.

@fredmertz: It sounds like you haven't really entered a Costco. Outside the high-end televisions in the front, the store is peppered with expensive furniture, kitchen utilities, and nice foods. Costco is anything but a 'cheap things' store--it is a place to get high quality stuff at great prices.

@coren: Costco stocks inventory based on demand. There is a Costco in downtown SLC that has a much larger selection of baked goods and other restaurant-friendly items because the large amount of sandwich shops and restaurants downtown buy from them. I love the sourdough bread that appears at this Costco, but no other Costco I've been in.

@XianZhuXuande: True. Costco also has the most bizarre sense of "seasonal" I've ever seen with some items - and I'm not just talking Christmas Creep

@redkamel: May God have mercy on your soul

@HiPwr: I love the I'm too smart to be manipulated by canny marketing demo since they're the easiest to reach tendrils around.

@nakajo: But placement is carefully thought out, with a mind towards customers who don't have these aspirational items in their selection set.
Not that it contradicts your point, or is nefarious. But a lot of thought (and science) goes into merchandising.

@coren: Costco will always have a fond place in my heart after I lived in Japan for two years, and they were the only place in the area where you could get such delicacies as root beer, oatmeal and beef jerky. Oh, and decent pizza. And by "in the area," I mean "within two hours by train and bus." That place was great, though.

The best thing about Costco Japan was that you could go through, buy all the big box stuff you wanted, pay and then take it over to a shipping area where they'd pack it into boxes and arrange for it to be sent to you. It wasn't expensive, either, only ¥500 or ¥700 a box, as I recall. It would turn up in a day or two, everything packaged up nicely, and I never once had anything go missing. I'd have a Costco membership here in the States, but we don't have one in my area.

@redkamel: $29 is what, the sales tax that Windows 7 buyers will end up paying? :P

@GearheadGeek: The Cosco near me (I use 'near' loosely) doesn't even have a jewelry case.

@Trai_Dep: And fast food hamburgers are scientifically formulated to taste good.

Hm. I bought my car through costco. Probably not luxury (Toyota Matrix?), but definitely high-ticket @ $14k!

Now Costco is evil? They have excellent quality goods and take care of their employees really well. They're what Wal Mart should be.