"Sam's and Costco: The "Battle of the Twins" in Membership Stores

Recently, foreign media reported that Walmart plans to open 100 Sam's Club stores in China before 2028. According to statistics, as of 2019, Sam's Club has 26 stores in China***, covering more than 20 cities, and the number of members in China is close to 2 million, of which the Futian store in Shenzhen has been the global sales champion of Walmart Group for 11 consecutive years. Unlike the affordable bulk purchasing model in the United States, Sam's Club stores in China mainly sell high-end imported daily necessities to consumers.

"Sam" on the Road

Sam's Club is a high-end membership store under Walmart, a Fortune 500 company, with a history of 37 years, and is one of the largest membership stores in the world. In 1996, Sam's Club "settled" in Shenzhen, although it has only 20 stores in China, but as China's first imported supermarkets, Sam's Club knocked on the door of the domestic supermarket membership system, that is, only store members can enter the supermarket shopping.

According to the National Bureau of Statistics, China's gross national income was 9,906.6 billion yuan in 2000, and in 2019, it reached 988,529 billion, 9.98 times that of 2000. The rapid development of China's economy has allowed foreign supermarket operators to see the dividends, and they are paying more and more attention to the consumer demand and potential of the Chinese market. Sam's Club has gradually accelerated the layout of the Chinese market. The number of Sam's Club stores grew by only five between 1996 and 2006, but after 2010, the number of stores grew rapidly.

According to micro hotspot (wrd.cn) data statistics show that from January 1, 2020 to the present, Sam's Club stores in the whole network *** counted to produce 112,300 pieces of related information, of which in the middle and late January due to the part of the consumer procurement of New Year's Eve goods led to an increase in the amount of information. As you can see from the information trend, Sam's Club's overall information volume is on a slight upward trend.

Costco and Sammy's

With the rise of domestic consumption, more and more consumers are pursuing high-quality products, and Sammy's wants to open more stores to reflect the importance of domestic consumers. Although the two sides of the consumption habits more and more close, but does not mean that the market capacity has been full. August 27, 2019, Sam's membership store, one of the competitors of Costco in Shanghai opened its first store in China, a time of traffic full of people, the opening of three days of the membership registration of more than 100,000 people, the opening two days of the market value of the wild rise of 56 billion yuan.

Sam's member stores entered the Chinese market 23 years earlier than Costco, but Costco has a great trend of later to catch up. According to statistics, from January 1 to May 24, 2020, the later Costco heat is significantly higher than Sam's Club, and even more than twice as much, but Costco due to the recent foreign part of the store to produce goods looting, the Shanghai store equipment room fire incident led to the decline of reputation.

The keyword cloud shows that when consumers discuss Sam's Club, "steak," "milk," "cake," "snacks," and other "goods" are used. The keyword cloud shows that when consumers discuss Sam's Club, "steak," "milk," "cake," "snacks," and other "merchandise" are the focus of attention. As for Costco, in addition to consumers discussing the products they need to buy, the phenomenon of "rush buying", "queuing" and "stocking up" in its stores is also of greater concern.

The data show that Sam's Club and Costco focus on people aged 20-39, but Sam's Club has a larger proportion of people aged 30 and above, while Costco is relatively younger. This may have something to do with the different positioning of the two stores, compared to Costco, Sam's Club is more focused on high-income groups, business executives and professionals, while Costco is more favored by the young crowd.

From the geographical distribution of the information, it can be seen that netizens in Beijing, Guangdong, Shanghai and other places are more willing to discuss Sam's Club and Costco, which coincides with the business layout of the two stores in the Chinese market. Currently, Costco's presence in the Chinese market is mainly in the East China region centered on Shanghai, while Sam's Club is also focusing on the super tier 1 cities and radiating to the tier 1 cities and provincial capitals.

Membership store "not suitable"

As of 2018, Sam's Club has more than 800 stores around the world, and recognized membership revenue of more than 1.4 billion U.S. dollars, while Costco is not inferior, with 768 stores around the world, and membership revenue of 31.42 million U.S. dollars. stores worldwide and $3.142 billion in membership fee revenue. The same membership store "BOSS-level players", the newcomer Costco and the veteran Sam's catch up with each other in the invisible stirred up the domestic membership store of the new splash.

In the 1990s, China's retail market gradually opened up to foreign investment, with Sam's Club, Wankelong, and Pall Malls as the representative of the membership store has come, but due to the different habits of domestic consumers, the payment of the "initiation fee" to shop the consumer model has not been able to form a trend. 2005, Pall Malls was forced to close down due to financial chain failure, which led to the collapse of the company. In 2005, Poolmaster withdrew from the Chinese market due to a break in its capital chain, and in 2007, Wankelong began to try to transform into a superstore. Along with the development of technology, the domestic e-commerce industry is gradually emerging, and at the same time, Wal-Mart, Carrefour, Yonghui Supermarket and other large supermarkets "blossomed" is to increase the difficulty of the survival of the membership system stores. Data statistics show that in the large supermarkets, Walmart, RT-Mart, Carrefour heat at the top of the list, and ranked at the end of the CR Vanguard heat of 12.7, far more than the Costco and Sam's member stores, the latter two heat of 8.12 and 3.34.

But from the overall point of view, the membership store route itself is different from the traditional superstore, streamlining SKU (stock volume unit), reducing gross margins, and so on, to make it more difficult to survive. SKUs), lowering gross margins, and emphasizing member revenues and services, all of which are different from the development characteristics of traditional superstores. In the increasingly competitive retail market, Sam's membership stores have a long way to go to keep up with domestic market trends, meet consumers' needs and habits, and be accepted by Chinese consumers.

Micro Hotspot Data Note: This report is written and produced by Micro Hotspot, with data from Micro Hotspot, Sina Opinion, Uranium Media, and other big data products under the umbrella of Midea Information, and partially quoted from external public data and information. Please cite and reproduce this report, please indicate the source.