Wednesday, May 29, 2024

Costco begins using verification scanners at some Ottawa stores

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At least one Costco store in Ottawa has implemented a digital card scanner for member entry, a departure from the traditional in-person card check, in an effort to crack down on shoppers who have not paid a membership fee.

Traditionally, store employees would be seen at the front entrance simply glancing at the membership card with the member’s headshot to verify their identity.

It’s unclear how many stores have adopted the digital verification system, but the system was seen used at the Merivale Road location in Ottawa.

Costco shopper Debbie Lascelle is a longtime member who likes the retail warehouse for it choices and price-points.

She typically frequents the Merivale Road location and says the store began using a digital card scanner at the front door about three weeks ago.

“You have to scan your membership card and your picture comes up on a screen to ensure that it’s the right person coming in,” she says.

“I think it’s a good idea. If they were having a problem with people coming in and people are misusing the cards, then I think that helps all of us.”

CTV News Ottawa reached out to Costco Canada for an interview or statement, but has yet to receive a response regarding the scanners. However, the moves appears to align with a similar initiative being tested at some of its locations in the United States.

According to U.S. media releases, Costco’s scanning aims to curb non-member access, particularly those using self-check out machines.

Retail analyst Bruce Winder likened this approach to Netflix’s recent strategy of clamping-down on account sharing.

“I think the biggest reason why Costco was testing the scanners at the door is to try to minimize the amount of people who borrow someone else’s membership card and go in and get the benefits,” said Winder.

Winder says a large part of Costco’s profits comes from membership fees.

The new scanning system is likely to also deter non-members from accessing Costco’s cafeteria and its inexpensive items like the popular $1.50 hot dog and drink combo.

Despite some potential opposition, Winder says it’s likely to see an expansion of the digital scanners at entry points.

“They do it already at the cash and I think people realize that they want to keep prices low and they want to make sure that members enjoy the benefits,” said Winder.

Costco memberships are not transferrable, but a second card can be provided to another person in the same household. Cardholders can also bring two non-members inside the store per visit.

Costco’s immense popularity is reflected in its numbers.

In 2022, there were 119 million cardholders, positioning the retail giant as one of the largest membership clubs worldwide.

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