Two Grocery Stores, Two Lessons
Yesterday, I went to Trader Joe’s.
Unfamiliar with it? It has small tropical-themed stores, good to high-quality products, unusual brands and lots of neat imported “foodie” products (hence the “Trader”). There are free samples and friendly, knowledgable people. A lot of products have natural or organic ingredients. And nothing is sale-priced, ever. It’s all priced fairly to begin with.
It does have a limited selection. It’s not one-stop shopping like Target or Walmart. But I actually have fun shopping at TJ’s.
Then, on to Safeway
Most Safeway stores are big and beautiful. Their people are nice. They carry fine products, with many choices. What’s not to like?
How about a complicated and overwrought pricing policy?
They run sale fliers twice a week. They have weekend specials. They have quantity deals. They have a smartphone app with personalized deals, if you spend enough time interacting with it. The register spits out coupons for stuff you just bought, which guarantees instant buyers’ remorse. It’s all very confusing.
I used to love Safeway. I still want to like it. But I always leave the store feeling like they’ve gamed me for every dime. I have to work to game them back.
Since Trader Joe’s came to town last fall, I’ve gone to Safeway less often. Once the country’s largest grocery chain, Safeway’s stock now trades near its 16-year low.
Like you, I’m always looking for the marketing lesson.
The obvious lesson would be, dump the neurotic pricing policy. But I think it goes much deeper.
Trader Joe’s has built a strong identity as a fun place to shop. A lot of elements make this possible. You get the feeling that at TJ headquarters, which must be in Tahiti or Kauai (I jest), enthusiastic foodies obsess over every product and policy to figure out whether it makes the customer feel rewarded in some way.
And Safeway? One clue is the lamest slogan in the world: “Ingredients for Life.” It sounds like a brand struggling for a position, crafted by people who would never be demeaned by fiddling with the annoying “Just For U” Safeway app to get 25¢ off a loaf of bread.
- Lesson 1: Companies need to be different in some way, and better in some way: differentiate and elevate. This is true for most businesses, especially small businesses and B2B businesses. It’s a key foundation for inbound marketing.
Of course it’s not easy. Safeway was once number one. Then came Walmart. And Trader Joe’s. And Whole Foods. And Target. Stiff competition from companies that differentiate and elevate.
- Lesson 2: Your old reliable formulas won’t work forever. Innovate, don’t stagnate.
So what should Safeway, and others like it, do now?
Simplify pricing, for sure. But that’s just one element. They need a plan that goes beyond promotion. It seems to me they’re trying to be all things to all people. Does that ever work?
What would you do to make people actually enjoy shopping at the Safeways (and Kroger and Albertsons) of the world? To be honest, it’s beyond me.