In what other ways could Joe Coulombe has changed his convenience stores to be able to survive when 7-eleven entered the market?
The secret of Trader Joe’s success
With fewer products, trader Joe’s could operate much smaller stores. the company knew customers preferred small stores they could enter and leave quickly. the average supermarket in 2014 was a gargantuan 46,000 square feet. a trader Joe’s is about 12,000 square feet. By deliberately keeping stores small, trader Joe’s has retained its appeal as a cozy, unique store, and not some big impersonal superstore. all of this—plus its friendly and helpful employees, garbed in loud Hawaiian shirts—appeals to the self-image of a well-educated professional, eschewing a more “common” supermarket.
privately held Trader Joe’s is now the grocery industry’s poster child. revenues were estimated at approximately $8 billion per year in 2011. and, as of that year, the company was estimated to rake in more than $1,750 in merchandise sales per square foot, more than double the amount Whole Foods achieves, despite its targeting essentially the same niche market. It’s little wonder that trader Joe’s is one of the hottest retailers in the United States.
Most important, trader Joe’s keeps a close eye on its target customer base. Before opening a store, it carefully monitors demographics in a market by salary, education, and even such indicators as subscriptions to gourmet food and health magazines.
Communities and consumers aggressively lobby the chain to open stores in their areas. a trader Joe does not only bring good jobs, its presence in your community also serves as an affirmation that you and your neighbors are worldly and smart. after all, that’s exactly the type of customer trader Joe targets.
questions
1. In what other ways could Joe Coulombe has changed his convenience stores to be able to survive when 7-eleven entered the market?
2. What other market segments could have been—or could be now—a good customer base for trader Joe’s?
3. as trader Joe’s keeps expanding, can it continue to be perceived as a store aimed at a narrow market segment, especially one that considers itself special?
4. What can large supermarkets do to grab a piece of the trader Joe’s market