Trader Joe's: At a crossroads?

By Professor Niccolò Pisani Niccolò Pisani, Professor Goutam Challagalla Goutam Challagalla and Inès Augier

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	Brick-And-Mortar, Competitive Advantage, Competitive Strategy, Competitiveness, COVID-19, Digital Disruption, Disruption, Grocery, Pandemic, Retail, Strategy
Settings	Northern America, United States of America Trader Joe’s, Food and Beverage, Retail 2020-2022
Type	Published Sources
Copyright	©IMD 2022
Language	English

Order this case study

Reference: IMD-7-2387

IMD case studies are distributed through case clearing houses. In order to browse the collection and purchase copies please visit the links below.

The Case Centre, UK Office

Cranfield University

Wharley End Beds MK43 0JR, UK
Tel +44 (0)1234 750903
Fax +44 (0)1234 751125
Email [email protected]

The Case Centre, US office

Babson College

Babson Park, Wellesley MA 02457, USA
Tel +1 781 239 5884
Fax +1 781 239 5885
Email [email protected]

Harvard Business School Publishing

60 Harvard Way, Boston MA 02163, USA
Tel (800) 545-7685 Tel (617)-783-7600
Fax (617) 783-7666
Email [email protected]

Asia Pacific Case Center

NUCB Business School

1-3-1 Nishiki Naka
Nagoya Aichi, Japan 460-0003
Tel +81 52 20 38 111
Email [email protected]

Copyright information

IMD retains all proprietary interests in its case studies and notes. Without prior written permission, IMD cases and notes may not be reproduced, used, translated, included in books or other publications, distributed in any form or by any means, stored in a database or in other retrieval systems. For additional copyright information related to case studies, please contact Case Services.