Can Trader Joe’s continue thriving without delivery and curbside pickup? – RetailWire
September 21, 2020
Trader Joe’s, who had no ecommerce presence or roadside pickup, missed the pandemic-triggered surge in e-groceries and doesn’t seem to mind.
The limited-range grocer is also facing challenges as its smaller social distancing stores are more difficult to configure. There have been long lines outside of the sites in the past few months.
Placer.ai Monthly visits to Trader Joe’s decreased 44.4 percent in April, 24.6 percent in May, 12.1 percent in June, and 3 percent in July. However, August turned positive, rising 1.0 percent, the first positive month since February.
“Amazingly, this is happening while other brands that have struggled – like Whole Foods – are staying down,” wrote Ethan Chernofsky, vice president of marketing at Placer.ai, in a blog post.
Trader Joe’s completed a delivery test in New York City in early 2019 to keep product costs down. The grocer doesn’t use any third party vendors like Instacart either.
On an “Inside Trader Joe’s” online episode As of April 20, Matt Sloan, vice president of marketing, admitted the chain had received requests to add such omnichannel offerings during the pandemic but decided to invest in people.
“Creating an online shopping system for roadside collection or the infrastructure for delivery is a daunting undertaking. It takes months or years to plan, build and implement, and requires enormous resources, ”he said. “Well, at Trader Joe’s, the reality is that for the past several decades we’ve invested those resources in our people, rather than building an infrastructure that eliminates the need for people.”
Tara Miller, director of marketing at Trader Joe, added that quotes from third-party delivery companies and roadside pick-ups by other grocers “don’t always produce positive results.”
The only other big grocer RetailWire Grocery Outlet, the grocer, found it didn’t offer delivery or roadside pickup.
RJ Sheedy, President, on a recent one quarterly call said the growth potential with physical stores and challenges that replicate the store experience is preventing Grocery Outlet from selling online. He said, “Ultimately, our customers enjoy the WOW in the store! Shopping experience, treasure hunt, value, personal commitment. “
DISCUSSION QUESTIONS: Should Trader Joe’s reevaluate his delivery and / or roadside collection decision if the pandemic continues, or is he making the right decision not to offer these services? Does Trader Joe’s focus on the quality of his store staff justify his decision?
“It ain’t broke. Don’t try to fix it. Trader Joe’s relies on his loyal customer base that doesn’t seem to have gone away. Don’t confuse yourself with success.”
“Trader Joe’s uses one of Sam Walton’s instructions: swim upstream. If everyone is going in one direction, look upstream for opportunities.”
“Trader Joe’s denies it. Long-term aversion to e-commerce just isn’t practical in today’s economy.”