Case Study Trader Joe's
Trader Joes executes its good value pricing strategy by offering unique gourmet products that are available for a low price. Trader Joe’s has developed a cult like following because customers are extremely satisfied with the quality and prices of their products. Trader Joe’s stores also have a unique in store environment that features employees wearing aloha shirts and fake palm trees. Trader Joe’s products are unique because they only offer about 4,000 products compared to the 50,000 items found in your local grocery store. Trader Joe’s website also displays various dietary lists including gluten free, kosher, and vegan. This allows for customers to make their shopping list before they enter the store, which may be necessary since Trader
Joe’s offers various exotic products such as organic Valencia peanut butter. Trader Joe’s uses the place, product, and promotion components of the marketing mix to keep its prices low. For example, the company usually places its stores on low rent suburban locations so that they can keep their costs down. They also save money by not having expensive bakeries, butchers, delis, and seafood shops in their stores. The company spends very little money on advertising because their loyal customers spread the company’s values through word of mouth. Trader Joe’s demonstrates the importance of price because since there prices are so low and their store environment has a family like atmosphere they have a very loyal following. The loyal following allows them to spend little on promotions and it will help the company continue to grow. Charles Shaw Wine, which is one of Trader’s Joes most successful products is priced at $2.99 and even has its own nick name “Two Buck Chuck”. The low price of the wine creates value for the customers because it makes customers feel like they got what they paid for and therefore the customers relationship with Trader Joe’s should continue to prosper (Kotler and Armstrong).
Joe’s offers various exotic products such as organic Valencia peanut butter. Trader Joe’s uses the place, product, and promotion components of the marketing mix to keep its prices low. For example, the company usually places its stores on low rent suburban locations so that they can keep their costs down. They also save money by not having expensive bakeries, butchers, delis, and seafood shops in their stores. The company spends very little money on advertising because their loyal customers spread the company’s values through word of mouth. Trader Joe’s demonstrates the importance of price because since there prices are so low and their store environment has a family like atmosphere they have a very loyal following. The loyal following allows them to spend little on promotions and it will help the company continue to grow. Charles Shaw Wine, which is one of Trader’s Joes most successful products is priced at $2.99 and even has its own nick name “Two Buck Chuck”. The low price of the wine creates value for the customers because it makes customers feel like they got what they paid for and therefore the customers relationship with Trader Joe’s should continue to prosper (Kotler and Armstrong).