Trader Joe’s, a Southern California based grocery store, has swept the nation with little to no marketing of their own! This is a wonderful opportunity to understand how social media and the brand community have impacted the business’s growth (Babin & Harris, 2016, pp. 158-164).
Trader Joe’s opened in 1967 in Pasadena, California ("Our Story," n.d.). Trader Joe’s has since expanded to over 474 across 41 states ("Trader Joe's," n.d.).
They use a unique private branding model, purchasing directly from
manufacturers and using their own unique labels. Trader Joe’s has also become popular
for great deals on wine, by purchasing overstock.
However, it is not the low prices or private branding
that separates Trader Joe’s from its competition. Trader Joe’s’s incredibly
unique selection of products creates remarkable buzz. This has created a
community of Trader Joe’s shoppers that share ideas and experiences, saving
Trader Joe’s serious time and money.
First, let’s explore Trader Joe’s’s extremely limited
company-driven marketing. Excluding a few radio ads, Trader Joe’s’s primarily
advertises out of store through their newsletter, The Fearless
Flyer, eight
times per year ("General Information," n.d.). The Fearless Flyer combines
exclusivity and elusiveness. A consumer can subscribe to the newsletter through
the store’s website, which allows them to actively become part of an informal
group of subscribers, and gives them expert power through knowledge of new
products (Babin & Harris, 2016, pp. 158-161). However, I have
received The Fearless Flyer without ever actively subscribing to the newsletter.
It is possible that Trader Joe’s is an example of the resource-advantage
theory, and is using my credit card information to find my address and send me
a flyer (Babin & Harris, 2016, pp. 11). However, it is
also possible that Trader Joe’s sends the newsletter to every address within a
certain radius of their store. By sending the newsletter to those who have not
actively subscribed, Trader Joe’s creates an interesting consumer dilemma. They
either increase the sense of exclusivity by suggesting the consumer has been selected
to receive the newsletter, or reduce the sense of exclusivity by sending the newsletter
based on location. In addition to the Fearless Flyer, Trader Joe’s does utilize
in-store marketing for new products.
 |
| [Fearless Flyer]. (2010, June 2). Retrieved from https://www.zendesk.com/blog/ corporate-coyness-at-trader-joes/ |
It is obvious that despite Trader Joe’s’s limited
self-driven marketing, their growth has not suffered. Much of this can be
attributed to the incredible social media presence created by Trader Joe’s
brand community (Babin & Harris, 2016, pp. 158-164). For a
company as large and well-known as Trader Joe’s, it is shocking to discover
that they have only recently expanded beyond an unsophisticated, somewhat
outdated website. However, according to Millennial Marketing, Trader Joe’s is
one of the leading brands among millennial shoppers: a generation who heavily
relies on online marketing to make consumer decisions (Golen, n.d.). The
fact is, Trader Joe’s loyal brand community has taken word of mouth to the web,
and created a consistent marketing platform for the grocer. For example,
thousands of Trader Joe’s fans have created and joined dozens of Trader Joe’s
related Facebook groups. While some share basic information about new products,
others serve niche customers like, “Kosher Trader Joe’s” and “Bring Trader Joe’s
to City X.” On Instagram, Trader Joe’s does have an official presence. However,
the unofficial account, @traderjoeslist, has generated more than triple the
following of the official account! This is a great example of how on social
media, Trader Joe’s’s consumers are more familiar connecting among themselves
than with the actual company. Finally, while Trader Joe’s does not have an
official company presence on Twitter, consumers such as @traderjoeslist and
@cookingwithTJ do, and have garnered thousands of followers.
Unfortunately for many other retailers and grocers,
Trader Joe’s hands-off marketing success is an anomaly. In his Forbes article, Glen Llopis has some ideas why this is the case. It is unlikely that another
company would experience similar results by abandoning company driven marketing
efforts. However, there may be an opportunity for companies to foster a larger
brand community within their own consumers. Are you part of a brand community?
How are you contributing to that brand’s marketing success? By learning our
roles in the consumer landscape, we can make informed, value-expressive
decisions about our behavior (Babin & Harris, 2016, pp. 131).
Next time I will be exploring how Amazon’s acquisition of
Whole Foods has influenced both company’s consumers’ behavior!
Hey Sabrina, I absolutely love your blog on “The Grocery Game,” this is a very unique and interesting blog topic series. Trader Joe’s is my all-time favorite American grocery store in the retail industry. Yes, it is interesting that Trader Joe’s does not market widely. I personally believe it is because it wants to give off the vibe of a “small neighborhood grocery store.”
ReplyDeleteDirectly from the Trader Joe’s website, this is how the company feels about marketing:
These days, the word “loyalty” when applied to a grocery store brings to mind a keychain loaded with little plastic cards and “robust data tracking.”
This is Dan Bane of Trader Joe’s. We know that loyalty doesn’t come from a special card, or a so-called “reward” you receive when you spend your hard-earned dollars in a store. At Trader Joe’s, we would never test your loyalty by printing out a three-foot-long scroll of coupons for money off things the next time you shop in our stores. We reward your loyalty by pricing our products as low as they can go every single day. No coupons or club cards needed… ever.
At Trader Joe’s, we believe loyalty is something we have to earn, every day, with every customer. So we focus on offering the best values on terrific foods and beverages, every day, in every corner of every one of our stores. The “reward”? You spend less money on the things you need and want, every day (Trader Joes Loyalty, 2017).
Trader Joe’s already offers its lowest prices. The company does not accept slotting fees (where manufacturers pay retailers in return for shelf real estate), mostly because almost everything is already under their own brand. They also cut out distributors, often receiving products directly from suppliers. Trader Joe’s brand image is the “funky shop around the corner that sources its wares from local farms and food artisans.” Its appeal rests in the fact that it’s not the standard corporate-brand supermarket. I think that is why it has been so successful…even without marketing.
Some things I wanted to point out – you mentioned that in addition to the Fearless Flyer, Trader Joe’s does not utilize in-store marketing for new products. However, the chain definitely does – just indirectly through daily free samples on new and seasonal foods! I know these are what grab my attention and drive many of my impulse purchases. You also mentioned that sending the newsletter based on location reduces the sense of exclusivity, but I do not think this is necessarily bad - it is a way to promote their products and catch the interest of new consumers. For the new consumers who enjoy the grocery store and latch on, Trader Joe’s has accomplished relationship marketing, meaning the firm’s activities have increased repeat business as a route to strong firm performance identity (Babin & Harris, 2016, p. 11).
This was really well written, and I am super interested to read your next blog on Amazon’s acquisition of Whole Foods. :)
Sources:
Babin, B. J., & Harris, E. G. (2016). Value and the Consumer Behavior Value
Framework. In Consumer Behavior (7th ed., p. 90). Boston, MA: Cengage
Learning.
Trader Joe's Loyalty. (2017, October 14). Retrieved from https://www.traderjoes.com/digin/post/radio-loyalty