How Trader Joe’s Survived COVID-19 Without Online Services…
Wait. What? TJ’s doesn’t do curbside pickup? Curbside bag dump? Won’t let Instacart inside? Really? They must be bankrupt by now? Yeah, Yeah, this is where my mind went in summer when I discovered that Trader Joe’s made no precisely no changes to its no online services corporate strategy as a result of the pandemic.
You know what happened? They won anyways! And none of us should be surprised.
You can see that Trader Joe’s suffered badly in the Spring as it lost almost 50% of its foot-traffic. And presumably 50% of its sales also, since Trader Joe’s offers literally no online or remote way to access its products. But, then, by July, despite the second wave of Covid-19 infections nationwide, foot-traffic snapped back. Since then, their foot traffic Monday-Friday is up about 10-15% all year since, with predictable dips every Sunday. It’s still the 9 AM-9 PM thing nationwide. With special 8 AM senior hours added to the front of Wednesday and Sunday, not overlapping with regular public shopping hours.
But here’s what happened to Whole Foods during the same pandemic:
Whoa. Keep in mind that Whole Foods’ store traffic includes the foot falls of every Prime Now or Amazon Flex shopper who comes on site as a proxy for a shopper sitting at home.
So what did Trader Joe’s do? Guess what? It’s a trick question. Hah! They really didn’t do anything differently other than ramp up protections for their staff. Here’s how they defied the odds
- An insanely loyal following! Only a true fan base will risk exposure to a deadly virus to come in MORE OFTEN.
- Sixty years spent curating special, specialty foods you literally can’t find anywhere else.
- TJ’s loves carbs and cheese! Their offerings do not fight with the basal tendencies of the Wal-merican diet. In fact, if Walmart could find a way to rip off half its SKUs, it would benefit more than bringing in fancy-pants, vegan startup brands. They veer more towards ethnic spicy than toward carb-less, vegetable-hugging.
- Insanely dedicated staff with a cray work ethic that has no doubt allowed them to operate at a reduced staffing level and still keep stores with higher YoY traffic in stock.
- Low-profit margin gave them few options – The very low, almost Walmart pricing on may items at Trader Joe’s has always irritated Whole Foods because they have no real way to match them across the entire store of packaged foods. Trader Joe’s has a secret, brutally Deutsch, negotiating approach with suppliers.
Perhaps the PR explanation for the refusal to turn on any online services at all or allow Instacart shoppers inside their stores (to mess things up) contains the real point: Trader Joe’s staff have helped sustain an amazing shopping experience for unique items for decades. The Hawaiian shirt brigade is not just a retail marketing gimmick. It’s indicative of a shopping experience worth shopping in person during a deadly pandemic. Take that as a litmus test, Walmart.
Take it as a retail analogy for the kind of brand enthusiasm you need to generate if you want to get your brand on the Skate Ramp.
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