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Case Study

Trader Joe's: At a crossroads?

By Niccolò Pisani, Goutam Challagalla and Inès Augier

11 pages

June 2022

Reference: IMD-7-2387

When Covid-19 hit the US in 2020, the grocery retail industry underwent a greatly accelerated digital transformation as consumers’ habits changed drastically in a matter of weeks. As Americans sought to avoid their risk of exposure to the coronavirus, the adoption of online grocery shopping, click-and-collect and self-checkout skyrocketed. By 2022, it appeared this shift was here to stay, changing the grocery business for the long term. Yet, while big supermarket chains were scrambling to capture this new wave of digital shoppers, Trader Joe’s consciously decided not to invest in e-commerce or omnichannel solutions. The company doubled down on experiential retail, choosing to remain a pure brick-and-mortar player and to keep its stores low-tech. Can this maverick company maintain a competitive advantage by going against the macro-trend of digitalization?

Learning Objective

Understand how Covid-19 disrupted the US grocery retail industry.
Analyze how macro-trends can influence an industry.
Evaluate an industry’s long-term attractiveness.
Identify risks and opportunities that a purely brick-and-mortar player like Trader Joe’s should consider when developing a winning strategy post-pandemic.
Explore the pros and cons of going against an industry-wide trend, as Trader Joe’s did by bucking the digitalization trend accelerated by Covid-19 in the grocery industry.

Keywords

Grocery, Retail, Strategy, Competitive Strategy, Competitive Advantage, Brick-And-Mortar, Disruption, Digital Disruption, COVID-19, Pandemic, Competitiveness, Digital

Settings

Northern America, United States of America
Trader Joe’s, Consumer Goods, Food and Beverage, Consumer Services, Retail
2020-2022

Type

Published Sources

Available Languages

English

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