Recently, I listened to Freakonomics’ excellent rundown of what makes Trader Joe’s unique among grocery stores – and how the business has gained a cult, cross-country following. Intrigued by the Freakonomics episode, I decided to follow up by reading Len Lewis’s The Trader Joe’s Adventure, which examines the key factors that set Trader Joe’s apart from not just typical grocery stores, but typical businesses.
While The Trader Joe’s Adventure was a bit longer and more circuitous than it needed to be, I’d still recommend that anyone interested in positioning, growing, and maintaining a business give it a read. I pulled several key mantras and ideas from Lewis’s deep-dive into Trader Joe’s – and I’m integrating those ideas into my understanding of how Butler Branding does (and should do) business.
Find and Focus on Your Differentiators
There are many things that make Trader Joe’s “Trader Joe’s.” The store’s tropical vibes, its small size and selection, the many private labels it uses to brand its niche products, its truly unique approach to customer service – all these differentiators combine to make Trader Joe’s stores stand out amongst the “same-old, same-old” of typical grocery retail.
Trader Joe’s understands that these unique qualities, its key differentiators, are the main reasons customers shop with them. As such, Lewis explains, Trader Joe’s is not in a hurry to mess with ANY of them. Instead, Trader Joe’s continues to double-down on its differentiators, because they’re working. The chain continues to cycle products in and out of its stores fearlessly (rather than keeping known winners on shelves at all times), because it knows its ideal customers are “adventure-seeking” – they want to find new things. It continues to focus on providing singular, high-quality products at low prices, rather than stocking five different kinds of peanut butter – because it knows its customers value uniqueness over bargain hunting.
So many times, businesses focus on innovating and finding the next “new” thing they can do for their customers, rather than iterating and improving upon what they already do best. Reading this study of Trader Joe’s has gotten me thinking about what Butler’s key differentiators are (I have thoughts, but that’s a whole ‘nother blog post) – and how we can purposefully push those differentiators to the forefront of our work.
Keep Things Simple and Sustainable
As it has focused on its differentiators, Trader Joe’s has found a business model that works for it. It (mostly) sets up shop within small- to mid-sized commercial locations, often parked next to big box grocery stores. It pulls some business from those “competitors” and picks up additional foot traffic from its other neighbors. It has simple, established processes in place for sourcing new products, hiring new employees, working those employees up through its ranks, and expanding into new markets. Trader Joe’s also continually refines its processes, keeping them sustainable while the organization grows.
You might’ve noticed that Butler Branding has been expanding recently – which has our team focused on refining our own processes. We are still working on making the new-and-improved Butler team as efficient as it can be, but we are most definitely getting there. We are more efficient now than we were three months ago, and we were more efficient then than we were three months before that. These efficiency gains have been the result of intentional work on our part, to examine, streamline, and iterate on our processes.
In a perfect world, I would be able to tell you that every Butler Branding process is “simple, straightforward, considered, and adaptable.” The reality of business- and team-building is that processes don’t start out that way – they get there through continual effort and refinement. The Butler team is putting in that effort, and we are iterating quickly – though I don’t think all our processes are “Trader Joe’s level” good quite yet.
Don’t Be Afraid to Change (But Don’t Lose Sight of Who You Are)
While Trader Joe’s mindset and processes have remained fairly consistent throughout its existence, even it has had to change over the years. At a couple points within The Trader Joe’s Adventure, Lewis talks about how Trader Joe’s was hesitant to install barcode scanners at its checkouts. The company’s leadership thought the technology was too expensive for the expected return, and (more importantly) would lead to impersonal interactions at the checkout counter.
But, eventually, Trader Joe’s installed barcode scanners – and I wouldn’t want to visit a Trader Joe’s without them. Barcode scanners have made Trader Joe’s much more efficient, but the store also hasn’t lost the personal touch its customers expect while checking out. I’m always still asked about my weekend, or told a product I purchased is “to die for, OMG,” while conversing with my Trader Joe’s cashier.
Trader Joe’s found a way to integrate barcode scanners, a new, “modern” technology, into its existing system without messing with its differentiators. It adapted to the times and gave customers the checkout experience they expect from a modern grocery store, while also still feeling like Trader Joe’s. Trader Joe’s was able to balance integrating innovation with maintaining its identity – which is something that most any business operating in today’s ever-changing technological landscape needs to be able to do.
The Adventure Continues …
There’s more to glean from The Trader Joe’s Adventure (I’d highly recommend paying attention to how much Trader Joe’s values both its customers and its employees – it’s a big part of how the brand has built its cult following), but our processes demand that I wrap things up here and get back to working for our clients. If you find yourself with a bit of downtime, be sure to peruse The Trader Joe’s Adventure for yourself. It’s a quick read, that can teach you a lot about how a unique business purposefully set itself apart from its competition.