Through a special arrangement, presented here for discussion is a summary of a current article from Frozen & Dairy Buyer magazine.
Which do you think Trader Joe's shoppers would say they like the most, if they had to choose from among price, selection, quality of products or the total shopping experience? Not that the other options receive bad grades but "quality" turns out to be number one.
I recently asked Phil Lempert, editor of SupermarketGuru.com, to send me some data about Trader Joe's shoppers. Specifically, I wanted to ask Trader Joe's shoppers what percent of their shopping they do there, how often they visit, how they feel about the lack of national brands and if they thought price, selection and quality were up to snuff.
So last month, 1,293 members of Mr. Lempert's consumer panel checked in, with 67 percent of them women and 91 percent of them Trader Joe's shoppers.
Of the Trader Joe's shoppers, 82 percent rated product quality as "terrific," with another 16 percent checking off "okay." Only 2 percent -- sourpusses no doubt -- rated quality as "terrible." Next on our list: "total shopping experience." Here, 78 percent said "terrific," 20 percent said "okay," and those same malcontents 2 percent said "terrible." Price came in third, with 59 percent saying prices were "terrific," and 40 percent saying "okay."
"Selection" was in last place. With 49 percent saying "terrific" and another 49 percent saying "okay," that's hardly bad. But the differences between the relative answers are interesting.
"The majority of shoppers are using Trader Joe's for fill-in and special purchases," Mr. Lempert said in an e-mail. "It's more like a treasure hunt than a day-to-day shop. Also, the fact that half felt the selection was okay further reinforces this."
Mr. Lempert's
research showed that 92.6 percent of the Trader Joe's shoppers said "the
lack of national brands does not bother me." But only 2 percent said they
do between 75 percent and 100 percent of their shopping there. Okay, so
maybe it doesn't bother them, but they do visit other stores. Only 12 percent
said they do between 51 and 75 percent of their shopping at Trader Joe's.
This means that 86 percent of Trader Joe's shoppers do half or less of
their shopping there. But a third visit once a week or more, with another
25 percent visiting every other week.
Mr. Lempert sees a "huge opportunity for them (Trader Joe's) to expand to get an additional shop frequency out of each category of shopper. They probably need to add just a few leading SKUs that are currently not available" in the stores, he says. For Trader Joe's, getting more share of market would seem possible, since shoppers seem to be cherry-picking the stores not so much for price but for unique "quality" items. Based on the survey results, maybe some tweaks to promote lower price perception would also help, whether the chain actually cuts prices or not.
Discussion Questions: What can Trader Joe's do to increase the overall grocery spend from its loyal customers? What categories could be added or enhanced? What pricing changes might be required?