There’s no doubt that Trader Joe’s has a cult-like following of loyal customers, one of whom is me. I have always marveled at their unquestionable charm. But, curious about their unique business model, I did some research, asking the question, ‘Why does Trader Joe’s work?’ What I found was that maybe even more than their products, the psychology behind their success is fascinating. 

The customer’s journey through the store is well thought out and meticulously curated by Trader Joe’s to ensure that every customer walks out with a product in hand. Trader Joe’s makes a clear effort to create an atmosphere of a friendly, corner grocery store. Tiki-style design elements,  funky product names, and hand-drawn signs create an artisan feel and around every aisle is another friendly employee in a bright Hawaiian shirt to get you anything you need.

Trader Joe’s executes perfectly the homey feeling you can’t find in a Vons or Costco. This sense of belonging is included in Maslow’s Hierarchy of Needs, and Trader Joe’s plays into this psychological need by focusing on each comforting detail, from small metal buckets filled with vibrant sunflowers to wooden wainscoting on the surrounding walls. Little characteristics like this give Trader Joe’s its trademark cozy style and welcoming environment.

In addition to its overall atmosphere, Trader Joe’s offers unique products that can’t be found at most other stores, just like a neighborhood grocer. You can’t go just anywhere to get Steamed Pork and Ginger Soup Dumplings or Candy Cane Joe-Joe’s. Eighty percent of Trader Joe’s products are their own brand; they cut out the middle man. While the products have similar ingredients and recipes to those from more well-known brands, removing those brands’ names reduces prices and makes the products feel unique. This not only keeps customers coming back, but also plays into human’s psychological attraction to nonconformity. 

At the same time, though I often think of Trader Joe’s as having a variety of products, one of the main tactics the company uses to entice customers is limiting their choices. They keep it simple and only offer about 1/10th of the products a typical grocery store would carry. According to Sheena Iyengar, a business professor at Columbia University, customers are less likely to buy something if they are overwhelmed with choices. Trader Joe’s makes the choice for you by carrying a limited number of high-quality products that they know customers will like. No matter which of the three options for tomato sauce I place in my cart, because I’m at Trader Joe’s, I am confident that it is the best the tomato sauce industry has to offer. 

Adding to the limited variety of choices on Trader Joe’s shelves are the seasonal products that make shopping at Trader Joe’s a treasure hunt. You never know what you’re going to find when you round the corner. It may be the Pumpkin Spice Rooibos Tea you have waited for all year or the limited edition Ridge Cut Potato Chips Seasoned with Horseradish & Chive. 

From their reliable customer service to their samples and free coffee, shopping at Trader Joe’s is more than just a task, it’s an experience. It’s clear that the Trader Joe’s business model just works, and I am proud to be one of their many devoted customers who continues coming back for more.