Costco is Australia’s leading discount department store, according to new research from Roy Morgan. But it faced stiff competition.
Its ‘Discount Department Store Satisfaction Report’ found that Costco had a customer-satisfaction rating of 88.6 per cent in July.
This put Costco narrowly ahead of rivals Target on 88.5 per cent and Kmart on 88.4 per cent.
Roy Morgan says these ratings show that, overall, 87.5 per cent of customers of discount department stores are satisfied. This is an increase of 1.1 per cent over the year.
However, the biggest improvement over the past year came from Best & Less. Its rating rose 1.8 per cent year on year to reach 86.4 per cent. Costco increased by 1.7 per cent and Target increased by 1.5 per cent to 88.5 per cent.
Both Kmart and Big W improved their customer satisfaction over the past year, too.
In fact, the only declines were for Harris Scarfe and Target Country, which both just missed out on top-five places in July.
Costco expanding online
“Costco’s victory in July comes as the American retailer has unveiled plans for an ambitious expansion with a huge new distribution centre set to open in Sydney’s west next year, signalling an expanded online retail presence,” Roy Morgan CEO Michele Levine said.
“In an increasingly competitive environment, with discount department stores facing increasing competition from online retailers such as Amazon, the big two department stores Myer and David Jones, specialist niche retailers and, of course, each other, maintaining a high level of customer satisfaction and building a reputation of trust is key.
“The success of German discount supermarket chain ALDI provides a stunning example of how building a reputation for trust and dependability is solid bedrock upon which to build a successful business.
“In fact, as our most recent NTS results show ALDI is now the most trusted brand in Australia – across all industries.”