In the battle of two retail titans, Costco and Amazon, who wins?
Both companies operate under the same guiding principle of "subscribe and save," but they have risen to the top of retail via two different paths.
Costco, a brick-and-mortar giant, boasts 741 stores globally, 90 million members, and 231,000 employees. While the company did do $3.4 billion in e-commerce sales in 2015, that same year it did $109.6 billion in brick-and-mortar sales, its bread and butter.
Amazon, the king of online retail, is attributed for capturing 33 percent of all U.S. online purchases in 2015 and 43 percent in 2016!
The ability to save the consumer money has driven the astronomical success for both Costco and Amazon, but which saves you more money?
Taking matters into our own hands, LendEDU went shopping at a physical Costco store in Long Island City, New York and browsed Amazon Prime to compare the prices on 38 identical, commonly-bought items.
Once and for all, we wanted to squash the great debate: Does Costco or Amazon save the consumer more money? Keep going to see what we discovered.
Full Results From LendEDU's Costco vs. Amazon Shopping Experience
After shopping at a physical Costco Wholesale location and browsing Amazon for 38 identical items, LendEDU found that, on average, products on Amazon are 56.48 percent more expensive than the same goods found at the Costco store.
If a consumer was to buy all 38 items that we analyzed in one fell swoop, he or she would find that the total price from buying on Amazon would be 12.10 percent more expensive than going to Costco and purchasing the same items.
The table below outlines each of the 38 items that were browsed, the price of each item at both Costco and Amazon, and the price difference of each item when the Amazon price is compared to the Costco Wholesale price.
Widest Price Difference Between Amazon & Costco Is With Food & Beverage Products
Both by average price difference and total price difference, the widest price discrepancy favoring Costco Wholesale came from food and beverage products. On average, food and beverage products from Amazon were 120.15 percent more expensive when compared to the same goods at Costco. The total price of all the food and beverage products from Amazon was 95.82 percent more expensive than at Costco.
Judging from these results, consumers would be best served purchasing their food and beverage items from Costco Wholesale instead of on Amazon.
The price of Nature Valley Sweet & Salty Granola Bars (48 count) as featured on Amazon and at Costco (bottom left corner image). (note: Amazon price featured in picture may be different than price featured in table as pictures were screen-grabbed on Cyber Monday)
Narrowest Price Difference Between Amazon & Costco Is With Technology Products
Both by average price difference and total price difference, the most narrow price discrepancy between Amazon and Costco pertained to technology products. Even still, Costco still proved to be cheaper by the narrowest of margins. In terms of total price difference and average price difference, Amazon was more expensive by 2.23 percent and 0.23 percent, respectively.
Some technology products, such as the Samsung 55' 4K Television actually proved to be cheaper on Amazon, so consumers might be better served browsing Amazon first when shopping for the many gadgets of 2017.
The price of a Samsung 55" 4K TV as featured on Amazon and at Costco (bottom right corner image). (note: Amazon price featured in picture may be different than price featured in table as pictures were screen-grabbed on Cyber Monday)
Home Appliance Price Differences Between Amazon & Costco
In terms of total price difference for all home appliances analyzed, shopping on Amazon proved to be more expensive than Costco by 30.06 percent. In terms of average price difference for home appliances, Amazon products were more expensive than similar Costco items by 39.00 percent.
When discussing specific home appliances, the Panasonic Microwave was more expensive on Amazon by 100 percent, the widest price discrepancy favoring Costco. The Shark Rocket Flex Ultra-Light Corded Stick Vacuum proved to be the most favorable for Amazon, as it was 1.33 percent cheaper on Amazon than at Costco.
The price of a iRobot Roomba 805 Vacuum Cleaning Robot as featured on Amazon and at Costco (bottom right corner image). (note: Amazon price in picture may be different than price featured in table as pictures were screen-grabbed on Cyber Monday)
Miscellaneous Product Price Difference Between Amazon & Costco
In terms of total price difference for miscellaneous products, shopping on Amazon proved to be more expensive than Costco by a percentage price difference of 81.38 percent. When talking about the average price difference for miscellaneous products, Amazon products were more expensive than similar Costco items by 75.72 percent. Interestingly, this was the only instance where the average price difference was less than the total price difference.
In terms of specific miscellaneous products, Arm & Hammer Plus OXI Free and Clear Detergent (250oz) proved to the most favorable towards Costco, as it was 145.68 percent more expensive on Amazon. The most favorable product for Amazon was a 12 count of Uniball 207 Retractable Gel Pens, which was cheaper on Amazon by 14.41 percent.
The price of Arm & Hammer Plus OXI Free and Clear Detergent (250oz) as featured on Amazon and at Costco (bottom right corner image). (note: Amazon price in picture may be different than price featured in table as pictures were screen-grabbed on Cyber Monday)
The data that was featured in this report required a lot of hands-on work. To get the Costco Wholesale prices on 38 different items, I personally traveled to a Costco in Long Island City, New York. At this location, I took pictures of 38 different items and recorded the price of each item. Afterwords, I browsed on Amazon for the exact same 38 items that I found in Costco. While on Amazon, I looked to find the cheapest available price for each of the 38 items and that is the price I recorded. After all of the data was collected, I was able to run the percentage price difference equation. To do this equation, I first subtracted the Amazon price from the Costco price and than divided that number by the Costco price. After, I multiplied the resulting number by 100 and that was the percentage price difference. No discounts from credit cards used were included either, including the Amazon Rewards Visa Signature Card, the Amazon Store Card, the Amazon Prime Rewards Visa Signature Card, or any others.