The chokehold that Trader Joe’s has on students is so powerful that there is no doubt every single one of them has shopped there at least once since the beginning of the school year. What exactly makes Trader Joe’s so unique? Why do so many students shop at this grocery store rather than Giant or Whole Foods? Or decide to apply for a job there? Here is a deep dive into the business model, tactics, and psychology behind the beloved grocery store chain.
Firstly, Trader Joe’s is pretty sneaky advertising-wise. Surprisingly, they have no coupons, reward cards, online/billboard advertisements, or online delivery service, relying solely on customer word of mouth for business. Their business model is based heavily on investing in user experience (UX), mirrored through their charismatic and down-to-earth employees and their comforting atmosphere. Senior Azaria Daniel, an employee at the location next to The Bethesdian Hotel, commented, “It is such a welcoming workforce. There are employees from many ages, so there are no dull days. I believe we are mostly just expected to make sure the customer feels welcome and leaves happy.”
According to Nicole Urban (@/urbannic on TikTok), 86% of Trader Joe’s products are sold directly by Trader Joe’s. They carry a tenth of the items that the average supermarket does. As limited as this sounds, their selections and prices are reliable and consistent. Keeping their shoppers hooked with unique seasonable items and limited edition experimental products, a quick grocery run instantly becomes a treasure hunt. What is the probability that you will find those items at another time? Trader Joe’s unique product options lead to impulsive shopping.
Both locations around Bethesda – the one next to the hotel and the one on top of the tiny Target near the Kumon – are high-traffic. Inside the store, the layout is precise and purposeful. The frozen section is more fun and accessible with the open freezer bin layout, allowing customers the freedom to browse more casually, whereas in other stores, the frozen section is limited to aisles of foggy glass doors. Trader Joe’s also invests in the artistic design of the store. From hand-drawn price tags to the colorful painting-adorned walls, this easily tricks customers into thinking they are at a local market rather than a huge supermarket chain.
From a customer’s perspective, being met with too many options is not always beneficial. Having more choices is often paralyzing rather than liberating. Ever heard of the term “choice overload?” This phenomenon is called the paradox of choice, coined by psychologist and author Barry Schwartz. Trader Joe’s has removed this from their stores. According to a Columbia University study, traditional American grocery stores offer an average of 35,000+ options, but Trader Joe’s offers about 3,000. This approach limits the brain fatigue customers experience from choice overload and controls costs.
Altogether, Trader Joe’s rejects several core business practices of average grocery stores, but they are still doing exceptionally well. Their peak revenue was $13.3 billion in 2022. For a grocery store, they’ve accumulated three million followers on Instagram. Tara Jones, the Trader Joe’s Marketing Director, and Matt Sloan, the Vice President of Product Marketing, host a podcast to let customers in on upcoming and discontinued products and more. Their motto is: “We are committed to providing our customers outstanding value in the form of the best quality products at the best everyday prices.” Bits and pieces of their motto are echoed in their tactics and strategies, leading us to say that their influence on B-CC students will never dissipate.
