Trader Joe's Case Study

• Seeing the success of Trader Joe’s, many competitors are trying to imitate their business model. Wal-Mart started their Neighborhood Markets on 1998 storing only grocery and pharmacy item. In 2011, Wal-Mart started Wal-Mart Express, an even smaller version of the original supermarket and rapidly growing. This year, Fresh City Market started operating in Purdue University, Indiana focusing on fresh food. The small size grocery segment is growing and there are already multiple players in the market to take a chunk of that.
• Amazon, a major player in e-commerce is feverishly pushing into the grocery segment by riding on its Amazon Fresh unit. This same day delivery service, along with similar service already launched by Walmart, Safeway Inc,

Baby boomer generation will cease to be the most influential consumer group and the millennial will come to age. Their openness to explore new food products will define tomorrow’s market. But the damage done by the recession is still not repaired. Median household income is far from it pre-recession peak; and remains 7% lower than that of 2007. Household saving is low and consumers are price sensitive and cautious about spending. Both of these trends put Trader Joe’s in a very unique position, as they have a huge cult like fan following among those who love its offbeat products. Consumers also relate the company for selling high quality items at low price. I think the main focus for the company should be to continue on that track and take Market Development strategy. As of May, 2014, Trader Joe’s has 418 stores across 40 states, 174 of those are in California. The company receives continuous request in mails and through social effort to open stores in new locations. Enthusiasts form long queue in front of a newly opening Trader Joe’s store. The company should for sure use the public interest and expand into other states where the company footprint is

Convenience is the most important criteria for a satisfying shopping experience and hunting for parking spots has a potential to discourage otherwise happy consumers to come to store.
Risks:
Risks are integral part of a business strategy and can’t be totally avoided. Analysts caution that Trader Joe’s might lose its “quirky cool” feeling as it expands and opens more stores. The company should very carefully balance to keep its offbeat and friendly neighboring store image when expanding nationwide at the same time.
In today’s date, no company can ignore the importance of effective analysis and insight to consumer’s preference; but Trader Joe’s need to be very careful while rolling out a loyalty or similar program to collect consumer information. The company shouldn’t suddenly start providing discounts or promotions with a loyalty card as that might affect the everyday low price value proposition in consumers mind.
The company’s missing social media presence might be another reason of its charm among fans. The company needs to be careful not to lose that while developing its social media presence and starting to communicate directly with