Sam’s Club and Costco (COST) – Get Costco Wholesale Corporation Report have nearly identical business models. Both companies operate warehouse clubs that charge for membership in exchange for offering members very low prices.
The Walmart-owned (WMT) – Get Walmart Inc. Report Sam’s Club and its chief rival both offer very similar experiences inside their warehouses. Members get no frills, but do get samples (when it’s not a pandemic), low-cost food courts, cheap gas at many locations, as well as liquor stores, eyeglasses, hearing aids, and more in select stores.
It’s a very strong model that drives a lot of loyalty but it’s hard to differentiate between the two brands if you’re not a member of either. Once people join, they tend to develop an affinity for one or the other, but on the surface, Costco and Sam’s Club offer similar value propositions in very similar packaging.
Yes, there are some differences, but this is Lowe’s/Home Depot, or Coke and Pepsi — two very similar brands going after the same customers.
Now, however, Sam’s Club has a new perk for electric vehicle (EV) drivers. And, while it’s not going to make someone drive across town to join the Walmart-owned brand over its rival, it might help people decide when both chains are in similar locations relative to where they live.
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How Is Sam’s Club Courting EV Drivers?
Sam’s Club has a new offer with its credit card partner, Synchrony (SYF) – Get Synchrony Financial Report that should appeal to EV drivers. As of May, any Sam’s Club member who also holds the warehouse club’s signature Mastercard will earn 5% back in Sam’s Cash on EV charges at eligible EV charging stations in the United States. During “a special electric vehicle charging promotion,” cardholders will earn an additional 5 percent back on EV charges for a total of 10% back in Sam’s Cash for the entire month of May.
“We are continuously evaluating credit card rewards and features that will recognize cardholders for doing things that make a difference, like choosing to personally help the environment by driving an electric vehicle,” said Synchrony Executive Vice President Tom Quindlen in a press release. “We are proud to continue to build on our 25-plus year strategic partnership with Sam’s Club to offer programs that deliver more than just rewards to members, but help to make an environmental impact for the long term. Together we are making a sustainability commitment for our cardholders.”
Both companies cited Earth Day in the press release about the promotion.
“Earlier this year we launched Sam’s Cash — a new loyalty rewards program that simplified the way members earn and spend rewards. The addition of a way for members with a Sam’s Club Mastercard to earn more Sam’s Cash when they charge their EV, on top of our existing program, is yet another way we are working hard to offer an incredible value every day,” added Sam’s Club Chief Member and Marketing Officer Ciara Anfield.
A Sort of Shot at Costco?
Sam’s Club did not mention its rival in the press release launching the EV charging promotion, but for now, it does offer a perk its chief rival does not. It’s also a perk that does not have to be used at the actual warehouse club.
Costco and some Sam’s Club locations both famously offer members low-priced gas. Both also have EV charging stations at select locations, but the Sam’s Club perk can be used at stations that charge to power up your EV.
That’s a meaningful benefit that enhances the value of the Sam’s Club Mastercard. Whether that sends a flurry of EV drivers to the warehouse club remains to be seen (and it seems unlikely) but it does sweeten the chain’s appeal to EV drivers which could shift some members away from Costco.