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Lessons in customer experience from Trader Joe’s and Whole Foods

Two American companies consistently hit top notes for customer experience, and it is instructive to examine why. The companies are Trader Joe's and Whole Foods. According to an American Customer Satisfaction Index report, Trader Joe’s achieved 84 points out of 100, and Whole Foods achieved 82 points. This is significantly higher than other grocery outlets, and only Costco beat them with a score of 85. What's more, these companies are consistently at the top of the league. How do they do it?


Trader Joe's was ranked first for atmosphere and fast checkouts, and second for cleanliness, courteous staff, merchandise selection, and accurate pricing. Whole Foods' high rating is derived from the overall shopping experience – the general ambiance, the products, the employees, and the support for the environment and the community.


To achieve high customer satisfaction scores, it is critical that customers get what they are looking for. Trader Joe's customers cover a broad spectrum, but its core audience consists of people looking for value. These customers are not after something cheap that is on the edge of its shelf life; they want quality as well. They are likely to be well-educated, and for them, the atmosphere is also important.


Whole Foods customers have above-average incomes and are demanding. Freshness is, of course, important, but so are product range and presentation. Knowing that the company values sustainability also resonates with them, as this aligns with their values.


One thing that stands out in all the studies we have carried out on customer experience is the role of staff in its delivery. Employees rank only second to customers among Whole Foods' stakeholder priorities. Whole Foods strives to hire the best people and empower them to make their own decisions. Customers love the food and the space, but what makes a difference is the attention the staff gives them.  When Whole Foods employees participated in an annual morale survey in 2023, 86% said they enjoy their jobs. Happy employees make happy customers.


It is the same at Trader Joe’s. They pay their employees competitive wages and offer health care benefits, even to part-timers. The company is ranked highly as one of the best places to work according to Glassdoor.


At both Whole Foods and Trader Joe’s, employees' happy attitudes are contagious. Employees go above and beyond and have the freedom to find ways to help customers. Customers are made to feel appreciated rather than feeling like an inconvenience.


Both Trader Joe's and Whole Foods have a strategy that builds on their self-defined differentiation. This means they can set consumers' expectations and, because they are fanatical about their strategies, these are readily met. People going to these companies’ stores are not disappointed; they get what they came for.

 

There are many learnings from how these two companies achieve such high customer satisfaction scores:


High Customer Satisfaction Scores:

Trader Joe's and Whole Foods’ high customer satisfaction scores, significantly outperform other grocery outlets. This demonstrates the importance of focusing on customer experience to maintain a competitive edge.

Clear Differentiation and Strategy:

Both companies have clear strategic directions and differentiation. Trader Joe's focuses on offering quality groceries at affordable prices to well-educated customers, while Whole Foods targets health-conscious, environmentally-aware individuals with higher incomes. This clarity in strategy helps in setting and meeting customer expectations.

Store Atmosphere and Ambiance:

Trader Joe's excels in creating a pleasant atmosphere and providing fast checkouts. Whole Foods emphasises the overall shopping experience, including store ambiance, which contributes significantly to customer satisfaction.

Understanding Customer Needs:

It is crucial to understand and meet customer needs. Trader Joe's attracts value-seeking, quality-oriented customers, while Whole Foods appeals to demanding customers who prioritise freshness, product range, presentation, and sustainability.

Role of Employees:

Staff play a pivotal role in delivering excellent customer experiences. Both companies prioritise hiring the best people and empowering them to make decisions. They rank employees second only to customers among stakeholder priorities, emphasising their importance.

Employee Satisfaction and Empowerment:

Happy employees contribute to happy customers. Whole Foods reports high job satisfaction among its employees, with 86% of employees enjoying their jobs. Trader Joe's offers competitive wages and health care benefits, even to part-timers, creating a positive work environment.

Customer Service:

Both companies ensure that their employees are attentive and go above and beyond to help customers. This attentive service makes customers feel appreciated and valued.

Consistency in Delivering Value:

By maintaining consistency in their strategies and meeting customer expectations, both Trader Joe's and Whole Foods ensure that customers are not disappointed and receive what they came for.


Here is a list of things we should think about if we want to follow in the footsteps of these two companies in delivering great customer experience:


  • Strategic Differentiation: Clearly define and adhere to a unique strategic direction that aligns with customer values and expectations.

  • Focus on Atmosphere and Experience: Create a welcoming and enjoyable shopping environment.

  • Prioritise Employee Well-Being: Hire well, empower employees, and ensure their job satisfaction to enhance customer service.

  • Understand and Meet Customer Needs: Know your customer base and ensure your offerings match their expectations for quality, value, and experience.

  • Consistency and Reliability: Maintain consistent delivery of the promised customer experience to build loyalty and satisfaction.

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