Oct
23
A Lesson From Trader Joe’s: Your Customers Might Want Less Choice, Not More
I’m a big fan of Trader Joe’s.
"My" Trader Joe's, on the corner of Randolph and Lexington in St. Paul
But I’m not a foodie. So what’s going on here?
A big reason why I enjoy TJ’s is the lack of choice. Yes, I said the lack of choice. Where a regular grocery store carries at least 20 yogurt choices, Trader Joe’s presents me with four. It’s similar with tortilla chips — do I want yellow or blue? Apples? Two choices. Alfredo sauce? One choice. Olives? One choice.
Limited selection means fewer decisions to make! In my world, fewer decisions=easy. Easy=fun.
It makes sense for Trader Joe’s to carry a limited number of SKUs, as explained in this 2010 article:
A closer look at its selection of items underscores the brilliance of [Trader Joe's founder Joe] Coulombe’s limited-selection, high-turnover model. Take peanut butter. Trader Joe’s sells 10 varieties. That might sound like a lot, but most supermarkets sell about 40 SKUs. For simplicity’s sake, say both a typical supermarket and a Trader Joe’s sell 40 jars a week. Trader Joe’s would sell an average of four of each type, while the supermarket might sell only one. With the greater turnover on a smaller number of items, Trader Joe’s can buy large quantities and secure deep discounts. And it makes the whole business — from stocking shelves to checking out customers — much simpler.
Do you follow the Trader Joe’s model with your products and services? Not everybody does. A friend of mine once told me of an “About” page that contained five calls to action for five different service offerings.
I’m as guilty as anyone of making it difficult for clients to choose. Do we really need to offer a dozen variations of consulting services? Does it make sense to sell five permutations (or is it mutations?) of our software-as-a-service? Hey, maybe it does make sense in your business to offer a huge selection. But before you assume more choice is better, remember Trader Joe’s.
Are you new here? This is a good place to start.
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Comments
Great food for thought. I am the worst shopper for that very reason – I hate having too many choices. But I really need to go through my business to make sure that I am not making it difficult for customers to make a decision. I tend to throw a lot out there! Yikes no more!
Hi Lisa:
I need to do the same thing. I simplified my offerings about 2 years ago, but I think I can reduce it further.
Larry: There’s one in Rochester too!