Business Models Explained with Fexingo · 2026-08-29 · 12 min
Membership fees are the backbone of Costco's business model, but the real magic is in the treasure hunt. In this episode, Lucas and Luna dive into how Costco uses rotating, limited-time deals on everything from electronics to giant teddy bears to create urgency and excitement that simple everyday low prices can't replicate. They explain the psychology behind the treasure hunt, how it drives foot traffic and member satisfaction, and how it fits into Costco's broader strategy of keeping membership renewal rates at over ninety percent. With specific examples like the four-dollar ninety-nine rotisserie chicken and the seventy-thousand-dollar gold bar, they show how treasure hunt items are deliberately placed throughout the store to spark impulse purchases. They also explore the risks, like when a hot item sells out too fast or when supply chain hiccups leave shelves empty. If you've ever wondered why you can't leave Costco without buying something you didn't know you needed, this episode explains the method behind the madness.
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