Nobody Can Resist Costco’s Price Tags

Wednesday, 5:49 p.m.
September 2, 2026

I love going to Costco, don’t you?

Every visit is an adventure that ends with more things in your cart that you never imagined buying. You say you’re just “stocking up” on chicken breasts, cottage cheese, and spinach. But now you’re the proud owner of a new jumper, a cringey garden gnome, and a ten year supply of Q-tips®.

There’s nothing special about Costco though.

It’s not Ikea®, where we’re forced through a maze of household products named by a Swedish 5-year-old with high IQ.

No, Costco is just a warehouse. Filled from floor to ceiling with piles of pallets containing products wrapped in cellophane and miscellaneous price tags.

Hm, are Costco shoppers all impulse buyers? Maybe.

Or maybe, there’s a secret strategy behind Costco’s pricing that tricks us into buying more than we budgeted for.

Costco’s “Not So Secret” Pricing Tactics

Last summer, I was back in Canada helping my mum with the shopping (I’m her bag boy). Right after flashing her membership, she spotted a garden gnome and placed it in her cart.

She then gave me a detailed lesson on Costco’s pricing tactics:

Mum: “Oh, would you look at that, Jef? We better buy it before they’re gone.”

Me: “Huh, what do you mean gone? No, mum, put it back. We don’t need it and it’ll still be here next time.“

Mum: “No, Jef! Don’t you see the ‘Death Star’? It means it’ll be discontinued soon and never stocked again!“

Every professional Costco shopper knows about the Death Star. You know it as the asterisk (*) and it’s one of several pricing signals Costco uses.

Here’s the full list of Costco Pricing Signals:

1. Prices ending in .99: Regular, retail price.

2. Prices ending in .97: Corporate clearance markdown.

3. Prices ending in .49, .79, or .89: Special manufacturer deals.

4. Prices ending in .00 or .88: Local manager markdowns (often floor models, returns, or last-chance inventory).

5. The Asterisk (*): The "Death Star". When stamped in the top corner, it signals the item is discontinued and won't be restocked.

This is the real reason why I love Costco so much.

It’s not just for their cheap chicken breasts and discounted energy gels to fuel my triathlon and trail running addiction. It’s because they’ve infused psychology and persuasion into the entire shopping experience.

Behavioral Economics, Costco Edition

No matter how hard we try to be rational beings, we are often moved, motivated, pulled, and persuaded by the whims of our emotions.

In other words, welcome to Behavioral Economics.

AKA—the study of why humans make predictably irrational decisions with their money, defying traditional economic theory that assumes we are purely logical.

Costco is the perfect playground for it, too.

Let me show you all the psychological principles that are working on you as you walk between aisles of palletized products.

1. The Left-Digit Effect

Why aren’t retail prices whole numbers?

Turns out, we’re biased toward the leftmost digit of a number and ignore the rest. Even though a penny is insignificant, seeing an item priced $19.99 feels much smaller than $20.00.

This is the Left-Digit Effect, perhaps the oldest trick in the retail world.

What blows my mind is that in Canada, where they eliminated the penny, paying cash for a $19.99 item gets rounded right up to $20.00 anyway. The penny doesn't even exist, yet the .99 gimmick is still used to trick our brain into believing we’re buying something cheaper.

2. The Precision Effect & Subconscious Anchoring

Let’s say you’re in the small appliances aisle and there’s a Ninja Blender for $44.

If it’s priced at $43.99, your brain skips right past it as regular inventory. But when that price tag reads $43.97, now the pricing games begin!

First, The Precision Effect. When the number isn't rounded or standard .99, your brain assumes a precise, bottom-dollar corporate discount was calculated behind closed doors. It makes you feel like you've stumbled on an un-advertised steal of a deal.

Second, Subconscious Anchoring. This locks a price in as your absolute baseline of value. Instead of asking yourself, "Do I actually need a new blender?", your brain anchors on the markdown signal and shifts the question to, "Can I really afford to walk away from a secret $43.97 deal?"

Saving two cents on a blender isn’t significant—it's just Costco’s clever use of psychology to turn a passive shopper into an instant buyer.

3. Novelty & Pattern Disruption

Your cart’s half-full now and you’ve made it to the snack aisle. As usual, you’re flowing through a sea of tags that end in .99.

Oh, what’s that? A box of protein bars catches your eye: $14.49.

This is where Costco hits you with Novelty and Pattern Disruption.

Our brains are wired to recognize standard retail patterns, so an odd ending like .49, .79, or .89 acts like a mental speed bump. It snaps your brain out of autopilot and forces you to wake up.

Your brain registers the Novelty of the non-standard price, which, every Costco Cult Follower knows is a special manufacturer deal taking place behind the scenes.

By disrupting your mental routine, Costco gets you to pause mid-stride—and the longer you look at an item, the more likely it’ll end up in your cart.

4. Local Urgency & Floor Markdowns

As you emerge from the dairy aisle, you spot a stainless steel BBQ grill tagged at $299.00 and a BBQ tool set for $72.88.

That’s odd. Where’s the .99 or the .97?

Meet the local Costco manager’s secret weapon.

Prices ending in .00 or .88 mean the warehouse general manager wants that specific item off their floor today to clear room for incoming inventory.

Which, in theory, triggers Local Urgency.

Unlike corporate markdowns that exist nationwide, this is a one-off, single-store liquidation. And the moment you realize there isn't a pallet in the back with more in stock, it means you better buy this one right now or you’ll be driving to another city to hunt another one down.

5. Loss Aversion & Artificial Scarcity

You’re almost at the checkout, but then you see it. On the top right corner of a price tag for your favorite Indonesian coffee beans, there’s a tiny asterisk (*).

As my mum taught us at the start of this letter, this is the Costco Death Star.

It means this item is officially discontinued and will never be restocked.

Costco uses this simple icon to tap into Loss Aversion and Artificial Scarcity.

Behavioral science tells us that the pain of losing out on something is twice as powerful as the joy of gaining it.

That asterisk instantly shifts your internal decision from "Do I need more coffee?" to "Can I live with the regret of never drinking this again?" Before your rational brain can intervene, you’ve now loaded three bags into your cart (just in case).

BONUS: The Moral Licensing Effect

I mentioned my trail running addiction earlier not to flex on you (although, are you impressed? I hope so). Instead, there’s another psychological principle at play that affects endurance junkies like me.

It’s called Moral Licensing and it works like this:

• Step 1: “Virtue“ Purchasing
  I fill my cart with bulk chicken breasts, spinach, and endurance gels. This reinforces my identity as a disciplined, healthy athlete.

• Step 2: Accumulation of “Moral Credits“
  My brain keeps a subconscious scorecard. Since I’ve acted responsibly first, I give myself a ton of “good behavior“ points.

• Step 3: The License to Indulge
  Oh snap! I just arrived at the baked goods section. With my cart filled with healthy foods (and my brain loaded with “just do it“ credits), now I won’t feel guilty when I add that 8-pack of apple strudels and a carrot cake.

By the way, this isn’t just a trap for athletes and people pursuing hot bodies (like ordering a Diet Coke to justify a Big Mac). It turns out Moral Licensing ruins our decisions in money, work, and sustainability, too.

Click here to force me to write: Moral Licensing ruins your daily choices →

There you have it, my friend.

You now know all of Costco’s pricing secrets. Sadly, I might not be with you to be your bag boy, but at least you’ll understand why there’s a garden gnome in your shopping cart at check out.

To your success in business (and life),

The human behind
HX Copywriting

p.s. My mum is a true Costco hustler. Back in 2024, Costco discounted the 3D Catan game and my mum bought 10 of them. She gifted one to all my siblings for Christmas, then sold the rest for more than $300 each. Easy profit, all of which went straight toward her next Costco shopping spree.

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