Podcast Episode 111: How Trader Joe’s Defeated Choice Overload

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EPISODE SUMMARY

People love Trader Joe’s. Calling it a cult brand might be an underestimation of people’s love for this quirky speciality grocery store chain.

But the interesting thing about Trader Joe’s is that while its only about one-third the size of an average American grocery store, it manages to outsell all other American grocery stores by square foot. 

Join me in this episode of the Choice Hacking podcast as we unpack the psychological and behavioral science principles that helped Trader Joe’s gain a cult following, despite its small size, quirky customer experience, and limited stock.

EPISODE NOTES

Time Stamps

[0:14] – Jennifer opens by discussing Trader Joe’s and its popularity.

[2:07] – Jennifer explains what Trader Joe’s is to someone outside the United States who might not be familiar with it.

[2:58] – We learn that one reason for Trader Joe’s success is its limited choice.

[3:49] – Jennifer refreshes us on what the choice overload principle is.

[4:30] – Research has found four predictors as to when choice overload will appear, the first being choice set complexity.

[5:04] – The second predictor is called decision task difficulty.

[5:25] – The third predictor of choice overload, we learn, is preference uncertainty.

[5:54] – The fourth and final predictor is the decision goal.

[6:27] – Jennifer explains how Trader Joe’s reduces choice overload, beginning with giving customers fewer but better options.

[7:38] – Trader Joe’s also reduces choice overload by never having a sale.

[8:52] – Jennifer reveals the third and final way that Trader Joe’s reduces choice overload – not letting brands compete for shelf space.

[9:59] – We learn how we can apply Trader Joe’s methods to our own businesses and brands.

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