Trader Joe's Competitive Strategy

Trader Joe’s chief executives have been careful in their expanding of the brand to more geographic locations, and they must continue to seek out their target market of “intelligent, educated, inquisitive individuals” and settle around them.

Grocery shopping is more diversified and evolved than ever before. Individuals across the nation have access to everything from exotic products to unique delivery services. Often, specialty stores have limited locations whereas specialty services have a limited reach. However, two retailers have expanded to hundreds of locations while adhering to unexpected market positioning for previously untargeted market segments. Whole Foods Market and Trader Joe’s have become household names while also innovating beyond regional and national traditional chains. Despite comparable size in

Trader Joe’s occupies a niche position in the grocery market by providing natural, organic and eclectic selection of wines, frozen food, prepared food and groceries at everyday low prices. They have a small area format with limited products which has put them in the top rank for sales per square feet.

Thirdly, Trader Joe’s stores are small and located in non-prime locations, which holds fixed operating costs at bay. Furthermore, the company is able to generate the industry’s highest sales per square feet in its small sized stores. In an effort to diversify from its competitors, Trader Joe’s also relies on a non-traditional marketing strategy. Completely neglecting conventional marketing techniques like commercials or promotional offers, the company focuses on unique and store specific in-store marketing with its newsletter and the occasional radio ad being its major means of communication with its customers. The Trader Joe’s brand with its vast fan base is naturally another part of the company’s competitive advantage.

Research Question: What do the blogs and current news reports say? Is Trader Joe’s management benchmark for others to follow? In what areas relevant to Organizational Behavior does the firm have an edge on the competition?

This is because they constantly keep their shelf stock moving. This is shown by the SKU (stock keeping units) of 3500 compared to the traditional supermarket, which has an SKU of 55,000 (Kowitt, 2010). Trader Joe’s keeps their SKU much lower which enables them to constantly offer high numbers of new products. Therefore brand loyalty will not be as high for Trader Joe’s. Trader Joe’s keeps their costs per unit down achieving exceptional economies of scale. All of these barriers to enter the market make it difficult for new entrants trying to enter the market.

“At Trader Joe's, our mission is to bring our customers the best food and beverage values and the information to make informed buying decisions. There are more than 2000 unique grocery items in our label, all at honest everyday low prices. We work hard at buying things right: Our buyers travel the world searching for new items and we work with a variety of suppliers who make

One of Trader Joe’s biggest advantages is in their target market. They have found the niche that appreciates higher quality foods but is on a tight budget and Trader Joe’s has managed to provide high quality food that is at a great price. So you end up with the individuals who are health conscious and in college or recently graduated who value a great deal. Trader Joe’s has realized that and has capitalized on this fact by opening in locations that are easily accessible to both students

The Kroger Company is a leading grocery retail chain that prides itself on its customer satisfaction and conducting ethical business. Kroger operates nearly 2500 grocery retail stores in 31 states. An internal evaluation of the company's strengths and weaknesses are analyzed, in addition to an analysis of the company's external opportunities and threats. In coordination with this a consumer characteristic and behavior was diagnosed along with Kroger's strategic direction for its company.

Trader Joe’s forgoes advertising for a strategy of customer relationship management because advertising “can’t create an experience. It’s the personal relationship with these people that builds loyalty” according to St. John, vice president of Trader Joe’s (Guth, and Marsh 183-187). Through this strategy, Trader Joe’s has seen much success. At the time of this case study, analysts estimated annual revenues to be around 3 billion. Today they are estimated to be around 8.5 billion. The effect is that the company has grown and still continues to grow. Trader Joe’s has gone from having 220 stores in 17 states in 2004 to 356 stores in 28 states as of June 2011 (“Trader Joe’s”). One area of attention for Trader Joe’s is to not lose sight of this customer relationship strategy as it continues to grow into a national or even global company. The company needs to continue to “pay attention to the information it

Trader Joe’s is a major food retailer who has developed quite the name for themselves. It has well over 350 stores in over 32 states and is expected to continually grow over the next few years (Bond, 2012). For over 50 years, Trader Joe’s has been providing quality customer services, products and a unique shopping experience for its customers. They have come a very long way from when they first officially opened their doors. Trader Joe’s started when its founder Joe Coulombe wanted to find a way to differentiate his 7-Eleven stores (Schermerhorn, Osborn, Uhl-Bien & Hunt, 2012). In the food retailer industry, Trader Joe’s has developed a process that works well and

Firstly, it is important to remember the current situation of Trader Joe’s in USA, the company has over 400 stores in 30 states and is the leader in customer service in USA. However, the company is not on the top ten supermarkets in sales category. Additionally, Trader Joe’s just operates in USA and does not have experience in other international markets. (Peterson, 2013)

Trader Joe’s is an organic grocery food store that is one of the best known organic food chains. By listening to the consumer and adjusting to the changing consumer market, Trader Joe’s had built a brand equity that is continuously growing. Trader Joe’s faces stiff competition from other large organic food chains therefore must stand out and adapt to the consumers’ needs. Marketing strategies are important to communicate to the consumer more effectively and help target the consumer to their product. Trader Joe’s segments its products by psychographic, behavioral and demographic characteristics

For Trader Joe’s, they are able to demonstrate the importance of each responsibility in the management process by establishing a plan to serve quality products with natural ingredients, inspiring flavors, and buying direct from the producer whenever possible,. They also organize their stores to limit its stock, carrying about 1,500 to 2,000 products compared to retail mega-markets with 25,000 to 45,000 products. Through leading, Trader Joe’s support their future leaders by hiring managers only from within the company. Future leaders enroll in training programs called, Trader Joe’s University that foster in them the loyalty necessary to run stores according to both company and customer expectations. Lastly, Trader Joe demonstrated the responsibility in controlling by placing standards to sell natural based ingredient products, as well as striving to offer the highest quality type foods.

Trader Joe’s success with their employee’s is based on hiring individuals who are “ambitious and adventurous, enjoy smiling and have a strong sense of values” (Uhl-Bien, Schermerhorn Jr., & Osborn, 2013, p. 98). Trader Joe’s employees’ exhibit job satisfaction and higher performance because they are compensated very well in their earnings, benefits and professional growth opportunities. Employees’ that are based in California stores “can earn almost 20 percent