- Costco customers love its travel service.
- The platform offers members discounts on vacations and car rentals. It also recently started offering benefits such as a 2% cashback bonus on travel purchases for executive members. Costco also offers gift cards for all members on certain purchases.
- We put the system to the test and found it easy to use.
Costco’s travel service is fast becoming one of its biggest assets.
The retail giant has been offering members deals on hotels, flights, cruises, and rental cars since 2000. While it might not sound like the most glamorous way to book a trip, its customers can’t get enough of it, including Business Insider’s Kate Taylor , who bought a seven-day trip to Puerto Rico with flights, transfer, and a hotel stay for just over $800.
In Costco’s most recent earnings call, on Wednesday, CFO Richard Galanti explained that the quarter’s margin improvements were partly thanks to its travel business, which has high margins because of the few administrative costs associated with it.
“It’s not the value of that plane ticket and hotel, it’s the broker commission,” he said.
And it’s a good value for the consumer.
“Following the same philosophy as in the warehouses, we offer a limited number of products in an effort to focus on partners who consistently produce high-quality, exceptional value and superb service,” Costco representative Nikki Chellew told Business Insider in July . “Costco Travel adds to the overall value of the membership with savings that can exceed the cost of an annual membership.”
We tested out what it’s like to use:
The Future of Retail 2018 by the BI Intelligence Research Team.
- 1 Costco’s travel site offers its members a selection of deals from flights to cruises and rental cars.
- 2 The first section of the site is hotels. You can search by a destination and find somewhere to stay, even if it’s that same day. We checked out a weekend in New York City in April.
- 3 We compared this hotel recommendation for the same dates on Booking.com. Initially, the prices looked much cheaper, but after tax was factored in, Costco came out $50 cheaper.
- 4 You can also buy vacation packages: flights, hotels, and transfers or trips to theme parks.
- 5 Once you select the option you want, it’s very easy to navigate, and Costco allows you to customize your trip. This means that you aren’t limited to flight times that don’t work for you.
- 6 You have the option to upgrade your room in the next step.
- 7 At that point, an alert popped up warning us about a new construction next to the hotel, so there are no surprises.
- 8 You then have the chance to change your transfers to and from the hotel and book a private transfer for an extra cost.
- 9 There is a big premium for wheelchair-accessible travel.
- 10 The retailer is upfront about its cancellation terms, which is refreshing. On some low-cost websites, you’ll need to dig for these. There is an option to chat with a customer-service advisor if you need assistance.
- 11 There’s another section for cruise travel. There are 12 cruise lines to choose from, which cover all continents except Africa. Realizing that cruising is a big commitment, Costco offers a guide for newbies.
- 12 The system of searching for a cruise is straightforward: you can search by any destination and month and sort them by price, rating, and duration.
- 13 We decided to put it to the test and compared the cost of booking a six-night Royal Caribbean cruise from Venice to Barcelona on Costco’s website versus booking directly through Royal Caribbean.
- 14 Lastly, it offers car rental through four brands: Avis, Alamo, Budget, and Enterprise.