I had one of those ‘Eureka’ insights the other day when I saw the latest Trader Joe’s ‘Fearless Flyer’ on our kitchen table: Trader Joe’s has made a great business out of morphing their foods into ‘Significant Objects’ that we cherish and desire, well before and beyond tasting them.
In hindsight, I should have realized this long before, since we receive the Flyer in the mail regularly and I am one of those ‘food nerds’ who actually reads the quirky pamphlet as well as the often equally mysterious labels on Trader Joe’s products, which make even an egg sound exotic. We’ll get back to those eggs later. Also hold the thought that people who enjoy reading those philosophical labels and who choose foods to feel transported to foreign places (for lack of $$s to go there physically as often as they would want to) fit squarely within the strategic target of Trader Joe’s. Let’s first make sure you, too, see the (now) so obvious link between the ‘Fearless Flyer’ and how Trader Joe’s makes their groceries ‘Significant Objects’ which their ever increasing number of shoppers love, behold, rave about and keep coming back for.
You need to know that ‘Significant Objects’ is the title of a book by editors Josh Glenn and Rob Walker with Jason Grote, and about 200 other contributors. It recounts a literary (and behavioral economics) experiment in which random, mundane objects were bought on e-bay at less than two dollars (many would call it ‘junk’). Josh and Rob asked Jason and other established or up-and-coming writers to craft engaging stories to go with each of the one hundred widgets that ranged from a ‘Nutcracker with Troll Hair’ and ‘SARS Mask’ via a ‘Broken Mug’ and ‘Birthday Candles’ to a ‘Motel Room Key’ to a ‘Rooster Oven Mitt’ (Read some of the stories on significantobjects.com). Then they put the now story-infused objects back up on e-bay for auction… and obtained a 27-fold increase in total value ($3,600) for the ‘junk’ – you can also call that a 99% gross margin! The ‘stuff’ had acquired a ‘soul’ and people were ready to pay $50 or even $100 for some, now that they had an interesting story to them, now that they expressed a creative idea, an ideology, an emotion or had become otherwise ‘significant’ to the bidder. Interestingly, this value explosion did not seem to be impeded by the fact that the e-bay posts clearly stated that the descriptions were fiction, the result of authors being inspired by the object, rather than providing a factual background or description. In other words, the stories were ‘made-up’. On the contrary, it seems that this imbued the objects with even more inspirational power in the eyes of the beholders and bidder. In fact, the objects and their stories acquired a life of their own after the official end of the experiment, as we note in our book: “…these newly ‘charismatized’ things often started a narrative chain reaction. Once imbued with a story and thus with meaning, these inanimate things ‘sprang’ with emotional energy, becoming characters in novels or inspiring others to invent further stories and so on – showing that narratives don’t just elevate through emotion but inspire our imagination. In short, the power of storytelling is infinite because stories are by nature never-ending.”(‘Rethinking Prestige Branding’, 2015, pp.122-123).
I was exchanging e-mails with Josh Glenn about this, his experiment and our observations on it at the kitchen table, when I looked up and the ‘Fearless Flyer’ caught my eye – or should I say it ‘jumped at me’. ‘Hmmm isn’t that interesting, I thought.’
The Fearless Flyer is an off-the-wall grocery bulletin that Joe Coulombe, the ‘real Joe’ and founder of Trader Joe’s (TJ’s) started publishing it* in the late sixties. In his words1, he “wanted it to be a marriage of Consumer Reports and Mad magazine.” Trader Joe’s2 describes it like this: “The Fearless Flyer doesn’t fit neatly into just one category—as with most other good things. Is it a newsletter? A catalog? A comic-book? Yes, yes, and perhaps even yes! The Flyer abounds with product stories that are at times fascinating and amusing. Beyond the intrigue and chuckles, our ultimate goal is to keep you well-informed about our products so that you can easily find what you want next time you stop in to shop.” The flyer was initially published every 3-4 months, but enjoyed such popularity that a new issue appears 8 times annually today in stores, online and via mail subscription.
What makes people cherish this grocer’s promotion so much that some meticulously archive back-issues or trade them online? It’s the storytelling!
The Flyer is like a fun correspondence course in international food and drink† history and degustation (†where permitted by state law) – filled with factual information about the provenance, dietary value, preparation, matching recipes, pairing with beverages, and so on of the foods reviewed, to satisfy the left side of the brain. But it also satisfies your imaginative left side as the product essays often take on an eccentric spin headlined by a sometimes wacky product name (like Coffee Cup Quintet, Speculoos Cookie Butter or Milk Chocolate Jumbles) and titles (“Bone Appetite –Cat and Dog Garlic Wafers”) to the peculiar ways of putting things (“culo nudo (‘bare-arsed’)…cauliflowers”?) to a celebration of the low prices at the end (the Chocolate Jumbles can be had “for a rather untidy sum of $3.99”). And then there are the 19th century woodcut illustrations, re-edited to become zany food themed cartoons sprinkled in for good measure**. This is just the kind of stuff that engages the ‘over-educated but under-paid’3 Design Target of TJ’s as Joe Coulombe learned early on. Check out if you part of them them.
Do you see the parallel’s with the ‘Significant Objects’ project? – Each product is made something special, a food to behold. In TJ’s case, the price is fixed and low, as this is part of their mission, but tht makes those Jumbo Ravioli feel like an incredible steal for $2.99 and drives exceptionally high profit margins for low-cost operator TJ’s and its German discount chain owner Aldi. TJ fans keep back issues for the info and the fun.
The circulation of the hotly expected food essay leaflet exceeded that of local newspaper subscriptions in 1988, already (at 3 million) when TJ was still a regional West Coast chain with less than 30 stores. And like all good story-telling, Trader Joe’s has been spread beyond the flyer via word-of-mouth and then via the net as the below video shot in the dinosaur age of social media illustrates (2009 – on a ‘Palm Treo’ smartphone!). It is, literally, a film maker’s (Carl Willat) ode to the oddities of Trader Joe’s and its irresistible, myth-imbued products, staff and stores. The title: “If I made a commercial for Trader Joe’s” – That’s because Trader Joe’s doesn’t (need to) advertise. But I am sure they won’t mind this inspired love song which hits hearts much harder than any ‘real’ commercial could do (about a million of them according to Youtube count). See their subtle, very Ueber-Brand acknowledgement of the viral video at the end of this post.
As you will have noticed, the kitchen table Eureka! Moment has lead to a certain level of infatuation with and then research into Trader Joe’s that went well beyond the ‘Flyer’. TJ, it turns out, is almost a full-flung Ueber-Brand*** And I commit to share my insights in this respect in a second part to this post.
But first, we’d love to hear your take on Trader Joe’s. Share your obsession or objections in the comments below!
The Speculoos Cookie Butter is one of the top selling Trader Joe’s items. It’s spreadable Belgian Speculoos butter cookies in a jar – and it wasn’t even invented in America as the Flyer remarks.
*The bulletin was first called ‘Insider’s Report’. The CEO of Loblaws in Canada found the bulletin idea so ingenious that he decided to rip it off completely, name included. When Loblaw’s entered the US with their Report, Trader Joe’s protested and the bigger company bought the idea and name from TJ ‘for an undisclosed sum.’ Joe Coulombe happily changed his bouletin’s name to ‘Fearless Flyer’. A tidy profit from value-augmenting storytelling, one can assume.
** These cartoons were initially chosen since no trademark fees apply – another ingenious, very Joe way to save money, as we’ll see in our follow-up post.
*** I say ‘almost’ as you will be right to ask “Why talk about Trader’s as an Ueber-Brand when those are supposed to sell at premium prices” Well, TJ has written ‘affordable’ on their flag together with wholesome and exotic. Whole Foods followed a decade later and leveraged the high premium opportunity in exotic, healthy foods. But compared to it’s parent Aldi (yes, TJ is owned by the German deep discount retailer since 1978!) TJ is a premium player in the discount segment. Because they mix very low sourcing cost strategies with directly sourced private label brands that are never on sale (no heavily promoted national brands at TJ or coupons) TJ margins and cash generation are substantial for the grocery industry, as Joe Coulombe confirmed (2005). They are the top of the crop in discount Food, like Muji or Ikea are in discount furniture or design or Target (pronounce Targé) are versus ‘that other US mass-merchandiser’.
Sources and further reading:
Read more about ‘Ueber-Brands’ in our book “Rethinking Prestige Branding“
The Fearless Flyer on Tradet Joe’s website: http://www.traderjoes.com/fearless-flyer
1 Businessweek online archives at Bloomberg Business, April 1995. Link: http://www.bloomberg.com/bw/stories/1995-06-04/trader-joes-atlantic-overtures
2 Trader Joe’s subscription page for the Fearless Flyer. Link: http://www.traderjoes.com/hear-from-us.asp
3 From an interview with Joe Coulombe by Tim Morris of Coriolis Research, 2005. We will review the concept of Design Target and how it applies to Trader Joe in the follow-up post. In the meantime, you can also read about the concept of Design Target and its use by other Ueber-Brand on this blog or our book.
Here is how Trade Joe’s responded to Carl Willat’s love song: