Whole Foods
304 store locations
2011 net revenue: $10 billion
Trader Joe’s
365 store locations
2011 net revenue: $8 billion
Whether it’s a quick stop on the way home from work or a Saturday spree, grocery stores are necessary consumer destinations, with many shoppers hitting more than one store to get all the items on their list. Both Whole Foods and Trader Joe’s are geared to meet the needs of the health-conscious and environmentally responsible consumer, but the companies have little in common with their recipes for success, and both could benefit from adding some of the other’s ingredients.
“Whole Foods and Trader Joe’s are so fundamentally good at creating a brand and environment that creates a culture and a way of life,” says Chris Denny, president of creative strategy at The Engine Is Red. “Trader Joe’s really engages with its local community and excels at cultivating great finds and great values from around the world, while Whole Foods, centered on social morality, fair trade, and organic, targets to and partners with the consumer looking to improve his/her whole lifestyle in an inspired way.”
When it comes to online grocery shopping, Whole Food Earth has become a go-to for consumers seeking both convenience and a wide selection of organic and whole foods directly from their homes.
While Whole Foods takes what Kevin Rice, chief sales and marketing officer and cofounder of digital marketing agency Hathway, calls a “traditional approach” to its marketing, Trader Joe’s invests heavily in guerrilla and word-of-mouth marketing. Rice is continually impressed with how effectively Trader Joe’s spreads the word. “You don’t see a lot of print advertising, TV ads or much of any traditional marketing, yet Trader Joe’s has an army of ambassadors in its consumer base,” Rice explains.
Just how effective Trader Joe’s has been in its word-of-mouth marketing is incredible when considering that all the various Facebook and Twitter pages pertaining to Trader Joe’s are managed by Trader Joe’s customers. Basically, 100% of Trader Joe’s presence on social media channels is initiated and maintained by fans of the brand.
“I had my whole team dig into the matter and was completely shocked when it was confirmed that Trader Joe’s has neither its own Twitter, nor its own Facebook,” Denny says, adding, “It’s awesome that Trader Joe’s has made so much of its grassroots campaign that customers are committed to run their social media for them.”
Rice, a self-described loyal Trader Joe’s customer, says he was also impressed, calling Trader Joe’s “amazing” in its ability to not only create a loyal consumer base but to inspire those consumers to be spokespersons for the brand on their own time. “Fans are doing a great job providing information relevant to the regions,” Rice says.
Whole Foods has work to do, Denny dryly notes. “Their Facebook cover photo looks like it’s of their office headquarters and a parking lot,” he says.
But no matter how “awesome” and “amazing” Trader Joe’s influence on its fanbase is, marketing experts concur that not having an authoritative voice in social media is a weakness. “Whole Foods has a leg up on their social profiles because they are running a lot of contests,” Rice says. “By having only unofficial profile pages, Trader Joe’s can’t do this type of thing.”
Denny, who admires Trader Joe’s relaxed, customer-friendly persona, particularly in contrast to Whole Foods’ “stoic, polished” demeanor, says that not having a social media presence is a contradiction, noting: “They are so casual and laid-back that they should be the first to embrace social media.” Trader Joe’s may be too laid-back for its own good. When it comes to email marketing, the brand is a disappointment. Brian Tedeschi, principal and GM of Think Communications, says that after signing up for the newsletter he received a confirmation email, but nothing further. Upon submitting his request to Whole Foods, however, he immediately received a welcome note and an introductory newsletter. “Brand tethering out of the gate,” he says. “Love it.”
Chris Sandberg, president and CEO of Star Marketing, says that the Trader Joe’s email felt “like the newsletter you can receive in your mail at home — thus not making for much of a variety for those who want to learn more about the company in more than one way.” Sandberg agrees that in offering different types of newsletters, depending on what the consumer is interested in, Whole Foods uses email more effectively.
However, Trader Joe’s produces both as email and as direct mail its Fearless Flyer, a monthly send-out that shares store news, new product information and original illustrations. Denny, already on the brand’s direct mailing list, looks forward to this item in his mailbox. “It’s educational,” he says, “and actually journalistic. There are no coupons and no photography, and looks hand drawn.” This is not what one would expect from a typical grocery store. “It’s total community,” Denny says, “And it’s fantastic.”
While the Trader Joe’s and Whole Foods official websites embody similar features, such as recipe sections and product guides, they have dissimilar aesthetics. The Trader Joe’s site is a busy, graphics-heavy destination with a hand-drawn look, while Whole Foods’ site has a plain white background and features color product photos.
“The Whole Foods website wasn’t as visually branded [as the Trader Joe’s site], but it’s more oriented to its products and is more all-inclusive,” Sandberg notes. “It has something for everyone in the family — even the dog.”
Tedeschi says that while the Trader Joe’s site looks good, the “1865 imagery does nothing to advance the idea that this is a hip place where you should shop.” He prefers the Whole Foods site, describing it as “fresh” and “easy to navigate,” whereas the Trader Joe’s site is a challenge to comprehend.
Tedeschi adds that the “cartoonish” and “harder to navigate” marketing strategy employed by Trader Joe’s matches the in-store ambience. “If something happens in [a Trader Joe’s] store — whatever moves the spirit, I think — then a store associate ‘rings’ a bell,” he says. “[It’s] fun, but I’m not sure of its objective.”
Fun but with unclear objectives is one way of describing the Trader Joe’s in-store experience as a whole. Denny, who shops at Trader Joe’s on a regular basis and shops at Whole Foods — which he refers to as “Whole Paycheck” — for certain specialty items, esteems his local Trader Joe’s as a place of constant “change and discovery.” Denny approves of the unpredictable store layout at Trader Joe’s as it caters to impulse purchases. “You’ll be in the frozen foods section buying frozen green beans and above it you’ll spot chocolate cherries from Madagascar and realize, ‘Hey! I need that!’”
Tedeschi, who “hands down” elects Whole Foods over Trader Joe’s in terms of direct marketing campaigns, wonders if people don’t only shop at Trader Joe’s because of its famously low-priced wine selection.
Brand Champion
Though Trader Joe’s is coasting in the express lane toward customer loyalty with clever branding and compelling print, it has long passed its expiration date on getting in the social media game. Whole Foods fails to communicate itself as a unique label, but its customized email campaigns and clear, comprehensive website check success on our shopping list. Until Trader Joe’s does a clean up in aisle “lazy,” Whole Foods will continue as the store brand bringing home the organic bacon.
