Costco Brand Check-up: The Price Promise Members Pay For
Costco is a retailer whose customers pay before they shop. As of December 2, 2025, it has 81 million paid members and a fee increase behind it. Its shares have cooled since February. We examined the membership, the $1.50 hot dog, Kirkland Signature and the one vital sign that has started to drift.
Key takeaways
- Costco grew net sales 8.1% to $269.9 billion in fiscal 2025 and added paid members after its first fee increase since 2017.
- The fee increase supplied approximately 40% of membership income growth, and Executive members produced approximately 73.6% of worldwide net sales.
- The $1.50 hot dog and soda combo, unchanged since 1985, and the single Kirkland Signature label carry the brand’s value promise.
- The U.S. and Canada renewal rate slipped to 92.3% from 92.9%, which management tied to online sign-ups; it is the vital sign to watch.
Download the full Costco Brand Check-up (PDF): vital signs, timeline, diagnosis, treatment and sources.
Vital signs
All figures are in U.S. dollars. In the 52 weeks to August 31, 2025, Costco’s net sales rose 8.1% to $269.9 billion and net income reached $8.099 billion. Canada, with 110 of the 914 warehouses, posted comparable sales growth of 5.0%, or 8.3% excluding gasoline and currency. The annual report on Form 10-K counts 81.0 million paid members and 145.2 million cardholders.
The shares tell a cooler story. Costco closed at $922.03 on December 2, 2025, about 14% below its record close of $1,076.86 on February 13, 2025 and about 5% below its $975.00 close a year earlier. Sales, profit and members all grew over the same period, so we read the fall as a change in what investors will pay for growth. The brand vitals point the other way.
The membership is the product
Costco sells access before it sells goods, and the fee sits at the centre of its pricing strategy. In July 2024 it announced its first fee increase since 2017, raising the basic U.S. membership to $65 from $60 and the Executive membership to $130 from $120, effective September 1. Members kept paying. The increase accounted for approximately 40% of membership income growth in fiscal 2025, and paid members rose 6.3%.
The Executive tier does the heavy lifting. Its members earn a 2% reward and produced approximately 73.6% of worldwide net sales. In June 2025 Costco added exclusive shopping hours for them in the U.S. CEO Ron Vachris said: “We estimate these incremental hours have added about 1% to weekly U.S. sales since implementation.” A perk that rewards members for staying belongs in any customer retention strategy.
The hot dog as a price promise
The hot dog and soda combo has cost $1.50 since Costco introduced it in 1985. Former CEO Craig Jelinek said: “When you think of Costco, you think of the $1.50 hot dog.” In May 2024, the new finance chief, Gary Millerchip, went further: “I also want to confirm the $1.50 hot dog price is safe.”
A fixed price on a small item is easy to remember. Each member who pays $1.50 for lunch sees a price that has held for 40 years. We count the combo among Costco’s most distinctive brand assets.
Kirkland Signature carries the trust
Costco puts its own goods under one name. Kirkland Signature, which turned 30 in 2025, covers around 600 products and accounts for around $86 billion in annual sales, or around a third of Costco’s total, Grocery Dive reported, citing The Wall Street Journal. Claudine Adamo, Costco’s chief operating officer of merchandising, told the Journal: “I see it as a tremendous negotiating tool.” One name across about 600 products builds trust quickly. One quality failure would travel just as quickly.
The symptom to watch
Renewal is Costco’s pulse. The U.S. and Canada renewal rate stood at 92.9% at the end of fiscal 2024 and 92.3% at the end of fiscal 2025, with the worldwide rate at 89.8%. Millerchip said: “The decline in renewal rates was largely attributable to a higher number of online sign-ups entering the renewal rate.” He pointed to a large Groupon campaign from December 2023.
Management’s explanation points to members who joined online renewing at a lower rate than the base. The dip is small, but it is the first number we would put on a marketing KPI dashboard, split by joining channel.
What growing companies can learn
Costco’s brand is a set of kept promises: a fee members judge worth paying, a price that does not move, and one private label that holds a standard. It waited seven years between fee increases, and members stayed. When it bought growth through online sign-up campaigns, the renewal rate showed the cost. Decide which promise you will never break, and judge acquisition by renewals as well as sign-ups.
This check-up uses public information available on December 2, 2025. It is brand and marketing analysis, not investment advice.
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