Morgan Stanley analysts wrote in a note this week that Costco warehouses are seeing as much as low double-digit increases in membership counts after implementing the scanners, and suggested the high conversion rates of previously non-paying customers could lead to the retailer’s “Netflix moment.”
The report, led by Simeon Gutman, acknowledged that Costco and Netflix have two very different business models, but suggested the warehouse club’s new tool for checking memberships could lead to the kind of growth in paying customers that the streaming giant saw after it cracked down on password sharing.