 In a world where retailers (and service businesses) know more about their work than the value of their products to customers, Joe Coulombe's Becoming Trader Joe might not make sense.
It's more than the difference between Kroger or Staples where obsession with volume (SKUs) and micro-margins make $0.04 per hour raises the norm, and Trader Joe's obsession with product knowledge and obscenely generous (for the business) employee compensation. It's about differentiation (or what Arnoldo Hax termed The Delta Model) - what makes what you do and offer valuable to your customer. It's value not just price (and we often confuse the two - Steve Jobs and Apple knew that), and cheaper is not the same as value for your customers. Why should they care about your wine or coffee or chocolate or matcha or chicken? Because it's always something differentiated (unfiltered, locally sourced, organic, raw, seasonal, or limited quantities so FOMO kicks-in). Now because Trader Joe's doesn't care about carrying major brands (note all the Trader Joe's branded product versus Heinz, Kellogg's, or Barilla), doesn't mean they use their brand instead. No, their brand is a vehicle of value for their customer and customer being served instead. And everyone on the floor does everything - from stocking to the register and bagging. And everyone has favorites - flavor or seasonal favorites that don't have to compete with 40 different ketchups on the shelf at Kroger. And Joe flipped the script by prioritizing employee service in order to get better customer service - as crazy as that sounds in a world where everyone claims to be customer focused but rarely is or for long. The vertical integration of customer value is Trader Joe's - or at least Joe Coulombe's version of what he started and built. Differentiation, not just competition. Product knowledge of value, not just what's on sale. Employee buy-in because of management buy-in. A different kind of vertical integration based on customer value (what Elon Musk and Tesla know well). And don't let Joe Coulombe's curmudgeon capital markets quips and damn-the-socialism of state regulations and government sour your taste for what he shared in Becoming Trader Joe before leaving this world last year. Instead learn from what he built (because he did build something, not just break things or tear down idols - he actually created something and that's what so many in today's world of leadership gurus and corporate overlords rarely have on their resumes). It stings, but here's Joe's take on why we get things wrong - "A deeply troubled company is always the fault of the CEO, the board of directors, and the controlling stockholders who appoint these worthies.... It is never the fault of the frontline troops.” So maybe there's something of value in Becoming Trader Joe for you after all. Comments are closed.
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August 2023
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