Research Problem Trader Joe’s was established in the 1950’s and began as a convenient store but quickly transitioned into more of a novel design for exploratory food and beverages shoppers. Trader Joe’s is located in various areas within the ? United States, and San Francisco currently has three locations.
There are ? 4,000 items in stock and 80% of them are brand names. Trader Joe’s offers an array of products that are distinct from those sold in traditional ? supermarkets. The main focus of the company is the constantly changing ? product mix, which creates more uniqueness.Trader Joe’s offers value and a commitment of quality service through friendly and devoted employees along with a promise to offer quality products. A challenge that Trader Joe’s faces is the question of how to solve the expanding customer base and competing grocery stores such as Safeway and ? Lucky while maintaining their unique image and style.
Some substantial ? questions to approach this problem are: How important is it to Trader Joe’s ? customers to lower the price of Trader Joe’s products? What factors make ? customers visit Trader Joe’s? Can Trader Joe’s products act as a substitute ? or Safeway’s products? And how can Trader Joe’s increase their reach to the ? costumer? Secondary Data Analysis After screening through a numerous number of online resources, we have found some interesting articles and thoroughly studied them. As a result, we are now able to identify significant factors that will help explain our research question, which is “how Trader Joe’s can expand its business to be able to compete with big-name retailers while maintaining their values and uniqueness. ” First, let us explore the strengths that Trader Joe’s has over its competitors.According to the article, a researcher interviewed one customer who responded, ” When you think about Trader Joe’s, you think about innovative products. ” In our perspective, we believe it’s a very true statement because Trader Joe’s has always been known for its funky style, and selective products that you simply cannot find in other grocery stores.
It carries private-label products such as Trader Ming’s (Chinese) or Trader Jose’s (Mexican) that offer a wide array of culture-oriented food, ranging from an Indian curry to gourmet meatballs.Additionally, these products that are perceived as high quality, are marked at very reasonable prices. Because of its ability to change a chore of grocery shopping to become a unique shopping adventure, Trader Joe’s is doing an excellent job in attracting customers who are young, adventurous, and well educated. They also replace old products into new ones from time to time so that customers won’t get stuck with repetitiveness. Another major strength of Trader Joe’s is service.For instance, if you ask an employee where to find what you are looking for, instead of telling you where it is, he will walk you to there. Moreover, to better emphasize how much they care about their customers, another example would be appropriate.
If an employee sees you carrying a lot of stuff without a cart or basket, he will get you one immediately. That’s basically how they do business at Trader Joe’s. From hand-writing labels, recyclable big brown bag, to flashy employee’s outfit, everything altogether makes its corporate culture to be so strong, unique, and difficult to copy.Next, even though it seems Trader Joe’s has so many advantages over its competitors, we have found and identified some important drawbacks that could significantly affect its ability to expand further.
The first major weakness is limited advertising. Trader Joe’s has never appeared in mass media such as TV commercials or radio channels, and unlike Safeway and Lucky who invest heavily on mail and brochure advertising; it does not rely on mail advertising at all. Also, it does not offer any bargains and discount coupons whatsoever.In our opinion, that is a major weakness that could make it vulnerable to competitors. Another side effect that results from limited advertising is low brand awareness. Since it has never been exposed to the mass media, consumers don’t know that Trader Joe’s even exists so they shop somewhere else instead. As a result, Trader Joe’s could lose its potential customers and also, competitive advantage against well-known supermarkets that have high brand awareness.
In addition, Trader Joe’s tends to be in relatively small store, if compared to those of Safeway and Lucky, it would be more than half the size different.Nonetheless, having a small store provides both advantages and disadvantages. The pros are that it can save you time of wandering around looking for what you want, and the frustration from choosing the same product in different brands is minimized. Cons are the lack of variety of similar products, and the possibility of making one-stop shopping for parents. For example, Trader Joe’s has limited soda, juice, and soymilk selections while competitors have at least 10 different kinds of each item.Furthermore, it is impossible for Trader Joe’s to attract individuals or parents who are short on time and want to buy diapers, baby food, toothpicks, and dishwashing liquid at the same store. As we studied the strengths and weaknesses of Trader Joe’s carefully, we have come up with some ways to develop its expansion. The studies have indicated that most of Trader Joe’s customers tend to be young, open-minded, and well educated.
Therefore, if they can create more brand awareness and advertising especially on schools and colleges, they could gain more new and loyal customers.We also believe that the key to greater expansion of Trader Joe’s is through the word of mouth, otherwise how else could they make $8 billions last year without any mainstream advertisements? Aside from creating brand awareness and more advertising, there is still the most important task that Trader Joe’s must do. That is to maintain its values, uniqueness, and non-substitutability because these factors are the essence and the answers to why Trader Joe’s has been so successful until today.In this constantly changing business world, there is no guarantee that whether the already successful company will be safe and sound from competition, and Trader Joe’s is no exception.
There are always new, innovative companies emerging, and they are looking for ways to improve and be unique just like Trader Joe’s did. Not only are there competitions from new companies, established big-name retailers are also investing heavily on advertising and doing everything they can to be number one in the market.Essentially, there is tremendous pressure from competitors and economy that is forcing Trader Joe’s to become a conventional supermarket like them.
Thus, it is intriguing to see how Trader Joe’s will deal with these challenges and expand beyond our comprehension. Here are the secondary sources: http://www. businessweek.
com/magazine/content/08_09/b4073058455307. htm http://gbr. pepperdine. edu/072/tj. html http://finance.