An Ultimate Guide to Build a Shopping App Like Costco!

Costco Business Model & Revenue

Check the business model & revenue of the Costco shopping app:

How Costco Generates Money?

Over the years, Costco has effectively expanded its revenue streams through multiple channels. Following, we’ve discussed them in detail:

1. Membership Fees: Costco offers tiered membership fee plans with different options and prices. Depending on your location, membership fees are also subject to sales tax.

• Business Membership: $60 per year

In business membership you will get the following benefits :

a) Use at any Costco store worldwide and on Costco.com.

b) Get a free household card with your membership.

c) Earn 2% back on eligible Costco purchases, up to $1,000 per year. Redeem for Costco items.

d) Enjoy extra benefits and discounts on services like auto and home insurance, pet insurance, photo printing, and more.

• Gold Start Membership: $60 per year

In gold start membership, you will get the following benefits:

a) Use at any Costco store worldwide and on Costco.com.

b) Includes a free household card.

• Executive Membership: $120 per year

In executive membership, you will get the following benefits:

a) Includes a free household card with your membership.
b) Add extra cardholders for $60 each.
c) Use at any Costco store worldwide and on Costco.com.
d) Buy items for resale with the right resale information.

2. Merchandise Sales Volume: Over 90% of Costco's revenue stems from selling in-store Stock Keeping Units (SKUs). Costco managed to generate revenue of over $150 billion in annual income. 

3. Home and Installation Programs: Costco also generates income by offering various home and installation services, including HVAC installation, countertop installation, and carpet and flooring installation.

4. Auto Sales Program: Costco's partnerships have allowed over 3,000 dealerships to purchase new or used cars. This offers Costco other value-added services and lowers the cost of cars they purchase.

Factors Influencing the Cost of Costco Like Shopping App

Various factors impact Costco's overall development cost, such as shopping apps. Let’s discuss:

1. Platform Compatibility

Choosing a platform for your Costco shopping app will impact the development cost. Depending on your project's objectives, you will have to choose between Android, iOS, or cross-platform. Generally, iOS is more expensive than Android or cross-platform. 

2. UX UI Design

Customers love an intuitive and appealing design. If you want to draw customers to your app, you must invest in UI UX design. It will help your app enhance user experience and attract customers, boosting engagement. However, implementing an advanced design for your app will be more expensive. 

3. Features & Functionality

Integrating complex or advanced features and functionality in your eCommerce mobile app development will increase costs. These advanced features include AR/VR try-ons, gamification, and more. 

4. App Maintenance

Ongoing app maintenance and support ensure continuous flexibility and streamlined app operations. Therefore, investing in app maintenance is also a crucial part of Costco-like app development. 

5.Development Team Location

The geographical location of your development team will also impact the overall development cost. This is mainly due to labor rates, overhead expenses, and currency exchange factors. 

Hiring developers based in North America or the UK generally have higher rates. On the other hand, eCommerce mobile app developers based in Asian countries like India often have competitive rates while maintaining high-standard quality. 

If you are planning to choose the latter option, your business will save substantial costs by building a complex shopping app like Costco. 

Must-Have Features to Include in Shopping Apps like Costco

To make your shopping app a huge success, you must incorporate amazing features that would attract customers on a large scale. Let’s discuss:

1. User Registration and Login

User registration must offer different roles, such as admin, manufacturer, wholesaler, and distributor. Each of these roles should have a specific access level and permissions. 

Simplify the login process by allowing users to create profiles using email, phone numbers, or social media channels. Enable biometric authentication, such as fingerprint or face recognition.

2. Product Listings

To stand out, like a wholesale e-commerce app like Costco, make sure to allow sellers to display a comprehensive catalog of products. It must be high-quality and detailed, including available variants, pricing information, and so on. 

Moreover, it provides sellers with tools to effectively manage inventory, real-time pricing, and product listings into categories and sub-categories. This will streamline users' navigation, enhancing their shopping experience. 

3. Order Management

Enable buyers to view and check their order history, manage current orders, monitor & track their orders in real-time, and manage returns or exchanges. It assists users in keeping a check on their orders from orders to delivery processing. 

4. Search and Filter

Implement robust search and filter feature functionality in your shopping app. This functionality allows users to quickly find desired products based on keywords, categories, brands, or other attributes, helping them refine their search results quickly and efficiently. 

5. Push Notifications

Integrate a push notifications feature that allows users to stay informed about their products, shipping status, latest deals, and so on. It helps them stay informed and engaged and facilitates users' customization of notification preferences as per their needs and requirements.

6. Shopping Cart

To bridge the gap between shopping and purchasing, you must integrate a shopping cart feature in your app. Make sure it is user-friendly, where users can add or remove items, manage quantities, apply discounts or promotional codes, or save products for later purchase. 

7. Payment Gateways

Payment gateways are the most important feature you must integrate into your shopping app. 

It must support various payments methods that includes credit/debit cards, UPI, digital wallets, bank transfers, buy now and pay later mode, and other popular payment options. Also, make sure to secure checkout with SSL encryption to safeguard your transactions. 

8. Review & Rating

“According to a Dimensional Research survey, 90% of consumers place equal value on internet reviews and personal recommendations.”

Ensure the implementation of a review & rating system for buyers and sellers. Buyers can leave reviews or ratings for their products, fostering trust and transparency and assisting others in making informed decisions.

On the other hand, sellers can respond to reviews and ratings, which helps them build and maintain their reputation on the e-commerce platform. 

9. Social Sharing

More than 62.3% of the world’s population uses social media. Undoubtedly, people are mostly engaged on social media channels. Therefore, it must integrate social sharing functionality in your shopping app. 

It enables users to share their favorite products or their shopping experience on social media platforms, amplifying brand reach and attracting new customers.

10. Membership System

If you’re planning to build a shopping clone app like Costco, you must integrate a membership-based system. This system allows users to pay subscription fees to obtain access to exclusive discounts, deals, and other offers. This would help encourage repeat purchases and boost customer retention.

11. Analytics & Reporting

Integrate data analytics and reporting tools in your AI shopping app. These tools assist in tracking user behavior, monitoring sales and inventory performance, and gathering insights for continuous improvement and strategic decision-making.

12. Customer Support & Integration

To offer the best service to customers, integrate a customer support system. This system should include live chat, email communication, and a ticket system to quickly address and resolve customers' queries or concerns. 

Advanced Features:

Check the advanced features that you can incorporate into your shopping app:

1. AI-powered Visual Search

Use AI technology to enable users to conduct picture-based product searches, streamlining and optimizing their shopping experience. When users snap a picture of a product they like, the software will recommend relevant products from the stock. 

2. AR/VR Try-On

Use augmented reality (AR) and virtual reality (VR) technologies to enable clients to try on apparel, accessories, and furniture virtually before making a purchase. This immersive experience increases user engagement and decreases the likelihood of returns. 

Step-by-Step Guide to Develop a Shopping App like Costco

Following, we’ve listed crucial steps involved in development of shopping app like Costco. Let’s learn:

Step 1: Project Planning & Research

This is the crucial step of the development process that lays the strong foundation of your shopping app. You must conduct thorough market research to understand user preferences, target audience, and business goals. 

Also, make sure to analyze your potential competitors in the market. It will help you to establish a solid roadmap to ensure your project’s success. 

Step 2: Features & Functionalities

Identify key features and functionalities that fit your mobile shopping app like Costco. Consider integrating crucial features such as product search, shopping cart, user accounts, payment gateways, and push notifications. 

Additionally, you can integrate advanced features in your app, such as AR/VR, rewards programs, or gamification, to enhance user experience. 

Step 3: UX UI Design

Create an intuitive, accessible, and visually appealing interface that focuses on offering amazing user experience. Focus on easy navigation, clear product categorization, and seamless checkout processes. Incorporate vibrant visuals, icons, and interactive elements to keep users engaged throughout their shopping journey.

Step 4: Development

Choose a suitable technology stack and start building your app modularly. Implement scalable architecture to accommodate future updates and expansions. Collaborate closely with eCommerce mobile app builder and developers, designers, and QA testers to ensure smooth progress and timely delivery.

Step 5: Testing & Maintenance

Thoroughly test your app across different devices and platforms to identify and rectify any bugs or performance issues. Continuously monitor user feedback and analytics to make necessary improvements. Regularly update your app with new features and optimizations to stay ahead in the competitive market.

Read More: How to Build a Shopping App like Temu: A Detailed Guide!

How Much Does it Cost to Build a Shopping App like Costco?

There’s no fixed-amount formula for developing a shopping app like Costco. This is mainly because the cost of online shopping app development depends on various factors, including features and functionality, UX UI design, tech stack, and many others. 

However, the estimated cost to develop a mobile shopping app could range from $25,000 to $60,000. If you want advanced features and functionalities, it will cost you around $80,000 or above. 

Note:

For a cost-effective approach to shopping app development, consider opting for an MVP (Minimum Viable Product). Here, you need to focus on essential features and functionalities and launch your app in the market at a lower cost.

This initial phase will help you gather valuable insights and feedback, analyze market trends and audience behavior, and assess market demand. These factors will then assist you in seeking funding from investors and developing a full-fledged, feature-rich shopping app platform. 

This iterative process ensures that your final product closely corresponds with the demands and preferences of your target audience while minimizing risk and enabling efficient resource allocation. 

Transform Your Shopping App: Apptunix - Your Trusted Growth Partner!

The right partner is crucial to making your shopping app a profitable enterprise. Apptunix, a leading eCommerce mobile app development company is prepared to drive your growth. 

As a leading mobile app development company, we bring a wealth of knowledge and experience to ensure that your app will not only meet but exceed expectations.

At Apptunix, we understand the unique challenges and opportunities in the e-commerce landscape. Our seasoned developers, designers, and strategists work tirelessly to tailor solutions that align perfectly with your business goals and user needs. 

From crafting intuitive user interfaces to implementing cutting-edge features like AI-powered recommendations and seamless checkout processes, we're dedicated to elevating your app to new heights of success.

As your trusted growth partner, we're here to support you every step of the way, offering continuous optimization, maintenance, and strategic guidance to ensure your app remains ahead of the curve in a rapidly evolving market.

Experience the difference with Apptunix and unlock the full potential of your shopping app. Let's embark on this transformative journey together and propel your app to unparalleled success!