Why Are Trader Joe’s Customers the Most Satisfied in America?

Discussion
Jul 25, 2013

A new study of consumers in North America finds that, when it comes to customer satisfaction, no grocery chain tops Trader Joe’s.

Those participating in the study conducted by Market Force were asked to rate their last shopping visit with a grocer and then whether or not they would refer that store to others. Trader Joe’s rated highest, followed by Publix and Whole Foods.

So what was it about Trader Joe’s that resulted in such high levels of customer satisfaction? The chain ranked first on atmosphere and fast checkouts, and second on cleanliness, courteous staff, merchandise selection and accurate pricing.

Interestingly, TJ’s was not in the top five in any of the following categories: convenient location, low prices, sales/promotions and one-stop shopping.

"With most consumers satisfied with their grocery-shopping experiences, it makes for a very competitive playing field for grocers looking to distinguish themselves from the masses," said Janet Eden-Harris, chief marketing officer for Market Force, in a statement. "We start to see the greatest opportunities for differentiation in operations-related attributes such as fast check-outs, gracious staff and atmosphere."

Market Force interviewed 6,645 women (73 percent) and men (27 percent) from the U.S. and Canada. Sixty percent reported household incomes of more than $50,000 a year with half having children at home.

Which operational area identified in the Market Force research — atmosphere, courteous staff, fast checkouts, cleanliness and accurate pricing — is most important for grocery chains looking to differentiate from the competition? Why do you think other factors including location, prices, promotions and merchandise selection did not weigh more heavily in customer satisfaction levels?

Join the Discussion!

24 Comments on "Why Are Trader Joe’s Customers the Most Satisfied in America?"

Notify of

Sort by:   newest | oldest | most voted
David Livingston
Guest
4 years 1 month ago

It all comes down to making people feel better about themselves when they come to a store. People who make other people feel better about themselves will have lots of friends. Works the same with business.

Dr. Stephen Needel
BrainTrust

I don’t think Trader Joe’s success and its attraction is tied to operational areas—I think that’s the bonus. I look to their merchandise selection as the driver, and TJ was second on this.

Liz Crawford
BrainTrust

Location, prices, promotions and selection are the table stakes to a favorite grocery store. Cleanliness, courtesy and atmosphere are the incremental benefits that delight customers and keep them loyal.

Joan Treistman
BrainTrust

If you ask consumers to rate a product, service or store along specified attributes, they will do it. If you want to understand how consumers feel about a particular product, service or store you best know which questions to ask and use their input to identify attributes that define their experiences.

When I look at the reported research and the “surprises” it uncovers, I am left questioning the measures. Why would I expect Trader Joe’s to be comparable to Publix or Stop & Shop for convenience? Why would I expect Trader Joe’s ratings to be at parity with Walmart?

My answers to the questions asked of the reader are as follows. Operational areas that are important to shoppers are dependent on the grocery chains’ intended positioning. Grocery chains should have a strategy which builds on their self-defined point of differentiation. Then they can determine if consumers perceive them the same way and are satisfied with their shopping experience. Next the retailer can examine the competitive landscape to assess their position in it. Finally, they will be able to evaluate the success of their strategy and tactics.

Dick Seesel
BrainTrust

I can’t explain the “weighted averages” that led to the survey conclusions, but I do feel that Trader Joe’s secret is not just about accurate pricing and fast checkout. It really comes down to the small formats, well-edited assortments and value pricing of unique private-brand products. Not all that different from what drives TJ’s sister company Aldi, when you think about it.

Adrian Weidmann
BrainTrust

The two most challenging, elusive and yet most effective operational ‘home runs’ for your brand are atmosphere and courteous staff. Your staff is the most important and valuable brand asset you can possibly have. Put that staff into a great atmosphere and you’re on your way to a great shopping experience.

Factors that did not weigh more heavily in customer satisfaction levels—location, prices, promotions, and merchandise selection are simply ante to the game. They are not differentiators with regard to customer satisfaction. These issues have become part of the marketing cacophony and shoppers overlook these issues by choice unless they are on a specific mission. When you go to Trader Joe’s, you are experiencing a ‘story’ (Stew Leonard’s is another great example). Trader Joe’s is a brand that is very good at storytelling and bringing that story to life. The ‘typical’ grocery story is merely a clean warehouse.

Susanne Kernan
Guest
Susanne Kernan
4 years 1 month ago

When you listen to Trader Joe’s fans, they speak first about the selection and quality. They put up with the relatively few locations, small cramped stores and chaotic layout in order to purchase a well-selected and high-quality assortment. Note that they are strong in ethnic foods, in keeping with Millennial’s food preferences.

Ryan Mathews
BrainTrust
In “The Myth of Excellence”—a book I co-wrote with Fred Crawford—we identified five key transactional components: Access, Experience, Price, Product and Service. We suggested that to be successful, a company needed to dominate on one attribute; be differentiated on a second; and just meet the market on the remaining three. We defined Experience as how a customer felt about themselves as a result of a transaction. So, based on the survey results, it seems Trader Joe’s dominates on Experience (as we narrowly defined it) and—given its inventory—probably dominates on Product. I guess I fundamentally don’t want to answer this question because I disagree with its premise. The important part of differentiation is—well—being different. So, for example, if everyone in a market is heavily price oriented then service or experience might be the way to go. If on the other hand, one is in a trading area where everyone is hyper upscale, being price focused may be the path to differentiation. And, while I’m on a rant, since when are things like accurate pricing and cleanliness strategic options? I thought they were more like table stakes for retail competition. Am I wrong? Is there somebody out there sustainably competing by running… Read more »
Robert DiPietro
BrainTrust

I think it is great that lowest price doesn’t play a factor—another lesson for retailers that compete on price. I read a piece in Bloomberg today that stated Walmart’s back-to-school basket of 50 like items is 45% lower than Staples. I bet that doesn’t sway many Staples shoppers that go to the store for fast checkout, a clean store and knowledgeable associates.

The key attributes I like when shopping at TJ’s is quick checkout and the courteous staff. I know I’m getting a fair price and I FEEL GOOD shopping there. If if is possible, you leave the store in a better mood than you came in with, because the store gives off a positive vibe.

Richard J. George, Ph.D.
BrainTrust

In my national research on customer delight at food retail, the top 10 most important attributes were as follows:

1. Accurate check out
2. Speedy check out
3. No products on shelf after “sell by” date
4. Uncluttered aisles
5. Every item in stock/Shelves well stocked
6. Accurate shelf tags
7. Prices visible when scanned at check out
8. Easy access to parking lot
9. Advertised specials in stock
10.Complaints quickly and fairly responded to

I did not include the big three: cleanliness, quality, and price/value. I considered these attributes to be the “ante” to get into the game. No one shops in a supermarket that is dirty, lacks quality products and offers no value.

The reason price and promotions do not weigh more heavily in customer satisfaction is because the industry has conditioned consumers since the early days of food retailing (King Kullen in 1930) that prices have always been low, resulting in part from EDLP as well as frequent promotions. Similarly, merchandising selection in supermarkets averaging over 40,000 SKUs obviates this concern. Finally, the automobile and store saturation has made location less of a factor. Consider how many consumers drive past one or more supermarkets on the way to their preferred supermarket.

Cathy Hotka
BrainTrust

Hmmm…is it the fantastic merchandise? The associates who actually try to help you? Samples? The floral selection at the entrance? Customers don’t care…they just want to go back as soon as possible.

Mel Kleiman
BrainTrust

In some way, Trader Joe’s reminds me of the Krispy Kreme phenomena. Scarcity seemed to create demand.

gordon arnold
Guest
This was another great discussion that is totally relevant to today’s retail selling for success requirements. The information supplied was sufficient to support the conclusions in the article if the reader went into the Market Force press release and reviewed its information as well. This is a big country with diversity of permanent living inhabitants expanding at an astonishing pace. Our country’s open door policy creates thousands of customers in our markets daily which is a good thing for sales in this stubborn market depression. This expanding diversity needs attention in terms capturing a truth in favorite grocery chain position for all people living in America. The sample size used in this test is somewhat low for a population of about three hundred and twenty million inhabitants for the United States and Canada with at least 60% of them regular grocery store customers, but I am sure there is adequate support calculations to remedy these concerns to a minimum. Where the discussion was weakest was its own lack of support for how the social and economic diversity of population was recognized and secured in this test. There are many of us in the retail business that own a list of… Read more »
Sid Raisch
Guest
Sid Raisch
4 years 1 month ago

The main objective today is more frequent food shopping visits. The small format aligns on that. The addictive items sprinkled in their selection make them sticky. Anyone tried the chocolate dipped dunking cookies? Weird location over the food coolers but, once you know where to look, you always do. The value priced wine — Two Buck Chuck — same thing. Wine is in most every basket. There is a favorite item for every customer in almost every aisle and you know it before you enter the store.

Verlin Youd
BrainTrust

First, I am quite surprised that Harris Teeter (Kroger has tendered offer to acquire) does not show up on the list at all.

Second, on the question of how/what is most important for differentiation—it really comes down to the total package. You don’t have to be great at all items listed, but you do have to decide what you will focus on to differentiate given the desires of your target shoppers.

Bill Bittner
Guest
Bill Bittner
4 years 1 month ago
I am a little confused by the survey, or maybe by the narrative accompanying it. The survey seems to confirm the long term belief that location is a primary factor in choosing a supermarket. Because of its repetitive nature and the perishable nature of some products, consumers are looking for convenience when it comes to grocery shopping. But the narrative seems to brush aside this long held belief. As far as the correlation between willingness to recommend a store banner and satisfaction with the banner, this almost seems like a “no brainer.” When you consider Trader Joe’s as the top banner for customer satisfaction with the fact that it does not appear among the top 3 most frequented retailers in any of the regions surveyed it only seems to confirm the image of TJ’s as a niche retailer with a highly loyal but concentrated customer base. Contrary to the conclusion that prices, promotions, and product mix are merely “table-stakes” that consumers expect of their retailer, I think they remain a key factor. If you don’t pay the ante, you’re not in the game. If you don’t have some externalities that can attract consumers into your store, they will never experience… Read more »
Craig Sundstrom
Guest

I’m confused by what this survey is trying to accomplish; it appears they asked current shoppers how they feel about “their” store, and then reported the unweighted results, so if 100% of some niche store’s customers like it, the store gets 100%, while a store that has 50% share gets, say, 60%. But is this meaningful…is 100% @ 2% better than 60% @ 50%? In short, while I’ve nothing against TJ—full disclosure: I buy my lettuce there—I’m much more impressed by the high marks shown by conventional stores likes Publix.

Anne Bieler
Guest
Anne Bieler
4 years 1 month ago

How do you evaluate shopping experience? Probably not by using a survey. Research tells us that experience is what drives customer satisfaction and emotional loyalty. Trader Joe’s has a truly fun atmosphere and staff that are friendly, helpful and knowledgeable. The small format makes it easy to shop. Interesting and engaging displays and packaging for products that don’t disappoint, fresh and better for you products at fair prices contribute to the experience. And yes, many carts have a bottle or two of “Two Buck Chuck,” as well the wine aisles are nicely curated with affordable wines from global sources

As discussed, to differentiate, a retailer must stand out. Competing on the operation essentials means outstanding execution, but that’s still not enough to build an emotional connection. For most of us, shopping for weekly essentials is not really a “satisfying” experience, so making the store a compelling destination requires a retail mind set that welcomes and delights shoppers.

Mark Gardiner
Guest
Mark Gardiner
4 years 1 month ago

This data supports the conclusions that I reached in my book “Build a Brand Like Trader Joe’s.” That is to say, TJ’s devoted customers are drawn to the store by the chain’s extraordinarily cheerful staff. This survey’s been extensively reported on mainstream web sites, too, where commenters strongly support my premise; many, many commenters have noted how much they enjoy interacting with TJ’s staff. For more information, visit my TraderJoesSecrets blog.

As for, “why factors like location and price” don’t seem to be as influential… Bear in mind that a huge percentage of U.S. meals are consumed out of the home, and you’ll conclude that people simply shop less these days, so convenience is not as much of a factor. And the percentage of income spent on groceries has never been lower, so price is less of a factor, too.

Ed Dennis
Guest
Ed Dennis
4 years 1 month ago

Gosh, I thought the question was why are TJ’s customers the most satisfied in America! I counted 6 mentions of TJ’s in the criteria list, Publix had five and they only have a 5 state marketing area. The one factor I didn’t see is “loyalty program.” Isn’t this supposedly the most important factor in where consumers shop?

Lainie Petersen
Guest
Lainie Petersen
4 years 1 month ago
Trader Joe’s has the shopper experience down to a science and cleverly manipulates its alleged weaknesses into strengths. I’ve always enjoyed shopping at TJ’s, largely because the stores are comfortable and the staff is always friendly, knowledgeable and accessible. During the hours of 5-7 p.m., the after-work crowd gives the place a decided party atmosphere. But even sans party, it is still fun to shop there. Samples are often plentiful, TJ’s own signage offers information about their products, and staff members really know their assortment. Most of my trips through checkout involve a discussion of my purchases with the cashier including a mutual exchange of recipes or food-wine pairing suggestions. Who wouldn’t want to shop at a place that treats its customers so well? Limited assortment? Lack of sales? No one-stop-shopping? For some, these limitations are TJ’s strengths. TJs largely deals in private labels and offers limited product choices (with some notable exceptions). Customers don’t have to wade through multiple brands and evaluate promotional prices, taking some of the work out of shopping. The exception to TJ’s limited-choice rule is in the “fun” sections, such as snacks, wine/beer, cookies and chocolate, where there are numerous options. Dithering over these purchases,… Read more »
Shep Hyken
BrainTrust

I believe the total experience is most important. The magic is in the mix. Unless the consumer is looking at just price and only price, everything else matters. Trader Joe’s proves that the value experience makes price less relevant and that people will go out of their way to shop at a price that delivers that value. That’s the same as willing to pay more for the service and experience.

Bill Clarke
Guest
4 years 1 month ago

I’m late to the commenting party here, but I’m with notcom—the methodology of naming Trader Joe’s the “favorite” grocery store seems a little off.

Let’s say I do a survey about favorite ice cream flavors. But the survey isn’t to see what ice cream flavor is the most popular, it’s to find out exactly how much you like your favorite flavor. So if the majority of people think chocolate is pretty good, but a handful of people really really love butter pecan, then butter pecan is crowned the “favorite ice cream flavor in North America.”

Walmart may not win against the cultish crowd that lives and breathes Trader Joe’s, but then I don’t think they’re too concerned with winning a popularity contest when there are better ways to measure a win.

Jerry Gelsomino
BrainTrust

“Gracious staff.” There’s a term seldom used in retail, and maybe a marketing/operationally distinctive opportunity. I think TJ’s has that!

wpDiscuz

Take Our Instant Poll

Which factor is most important for customer satisfaction when it comes to grocery shopping?

View Results

Loading ... Loading ...