Trader Joe's making huge mistake not copying Walmart, Target

Walk into any Trader Joe’s and you know immediately it’s going to be a different experience than you’ll have in any other grocery store. 

It’s a quirky place that almost looks like it belongs in a different era. 

The stores are full of colorful hand-drawn signs, produce is displayed on top of wooden crates, and many locations are adorned with wall-to-wall wood paneling. 

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The old-school aesthetics, cheerful “crew members” and downright chill vibes might draw people in, but what keeps them coming back are the low prices, unique specialty products, and seasonal items. 

What you won’t find in any Trader Joe’s is so-called “in-store media,” e.g., smart carts, shelf-stocking robots, or digital signage. It’s intentional.

“Trader Joe’s is a store [where] shoppers enjoy shopping. That’s about as aspirational as it gets. Adding in-store media risks that experience,” wrote John Hennessy, a retail and brand consultant. 

Trader Joe’s just says ‘no’ to in-store ads and screens

And according to Inside Trader Joe’s podcast hosts, Trader Joe’s VP of Marketing Tara Miller and VP of Culture Matt Sloan, the company has no plans to modernize. 

For one thing, setting up a digital infrastructure would undoubtedly be a huge expense, so it is not something Trader Joe’s will prioritize anytime soon. Management says they’d rather invest in product development, employee support, and keeping prices low for customers.

But it’s not just about the money. 

Related: Trader Joe’s shares new locations coming soon

“There’s another cost that’s not a financial cost, but it’s a cost. It’s about values…philosophical values,” Miller said. “For us, one of our values is providing a ‘wow’ customer experience, and that requires being connected as human beings to each other, as crewmembers, as customers.” 

You won’t get that connection from a screen, Miller and Sloan insist. 

On the other hand, American shoppers don’t seem to be turned off by in-store ads, at least according to one recent survey. 

When Vistar Media, an ad platform that specializes in digital out-of-home advertising, surveyed 2,000 adult shoppers, they learned that one-third of them admitted in-store ads made them “stop and look.” 

And only 4% reported that the in-store ads “detracted” from their shopping experience. Most shoppers felt either “positive” or “neutral” toward the ads. 

Even if Trader Joe’s learned that shoppers just loved those screens, it might not make a difference. 

More retail:

• Walmart CEO sounds alarm on a big problem for customers
• Target makes a change that might scare Walmart, Costco
• Top investor takes firm stance on troubled retail brand
• Walmart and Costco making major change affecting all customers

As retail consultant Gary Sankary observed in Retail Wire, “they don’t have e-commerce, they don’t have home delivery, and they don’t have screens in stores. What they do have is packed parking lots and legions of loyal customers. Myself included. Let Joe be Joe.”

Still, there is certainly a lost opportunity for Trader Joe’s in e-commerce, and they might be missing potential consumers, both geographically and demographically, by not offering delivery or click and collect. The e-commerce grocery delivery business is $100 billion in the U.S., and the click-and-collect market is around $50, according to emarketer.

Trader Joe’s doesn’t care about customer data — or at least they don’t collect it like other businesses do

Another factor that sets Trader Joe’s apart is that, unlike pretty much every other business in the world, Trader Joe’s doesn’t care about collecting customer data.

“We sell food…we know what [customers] buy based on what it is that we sell. We’re not tracking our customers’ behavior,” Sloan said on the podcast. 

Related: Trader Joe’s shares new locations coming soon

“Once a retailer starts collecting data on you, they’re probably going to figure out new ways to monetize it. That’s what’s happening now with so-called retail media,” he added.

For its part, Trader Joe’s doesn’t care if showing shoppers a digital billboard featuring its new Sparkling Matcha Lemonade increases the likelihood that they’ll purchase it. They prefer to measure sales the good old-fashioned way: by looking at the shelves. 

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