Shopping for supermarket wine is an American pastime. And while some of us have always loved the act of buying groceries, pandemic restrictions on “nonessential” activities have made our weekly outings to the market all the more exciting.
Benjamin Lorr, author of “The Secret Life of Groceries: The Dark Miracle of the American Supermarket,” says that for many adults, grocery stores are like amusement parks. And while there are lots of reasons the supermarket became what it is today, one thing was fundamental to its success: alcohol. Booze, and specifically wine, played an especially important role in the rise of one of America’s favorite grocery stores: Trader Joe’s.
According to Lorr, Trader Joe’s changed the game for supermarket wine, making it the sessionable vino we know and love today. VinePair talked with Lorr about the role of wine in the modern American grocery store, and how Trader Joe’s played a key part in increasing Americans’ access to quality, affordable wine.
1. What inspired you to write “The Secret Life of Groceries”?
There were two paths to this book. One was that I’ve just loved grocery stores my whole life. They are this almost hallucinogenic place that I go to on a daily or weekly basis, with saturated colors on the shelves, as well as a large volume of different objects all screaming from the shelves. They’re simultaneously comforting and menacing. There’s something very powerful about them, and I wanted to scratch the surface behind that.
I don’t want to get too grandiose here, but the grocery store, to me, is this small stand-in for the civil project writ large. This is what we’ve created to meet our needs. It is pretty absurdly impressive when you look back on the human project — the amount of choice, abundance, low price, and high quality is so routine, we take those things completely for granted.
The short story was that I was working on my last book, which was about Bikram yoga and understanding why people were attracted to that as an obsessive pursuit. And in the middle of writing that book, I was trying to get close to this guru and spend time with him, so I went to one of his teacher trainings, where people are locked in a hotel complex for nine weeks doing gobs of yoga, and they would let them out to go to the grocery store. I watched these yogis, grown adults, descend on a Trader Joe’s, and I had never seen happiness like that in adults. There was just this maniacal glee, like adults going to an amusement park, and I think something just clicked.
2. What was Trader Joe’s initial strategy when it came to wine?
Joe [Coulombe] founded Trader Joe’s in 1958, and he realized pretty quickly that he couldn’t compete against big firms that had the power. So he chose to reinvent along several interesting angles, one of which was that he realized that, as the GI Bill promised college education to people who weren’t previously allowed to get one, that more consumers were going to [go to college] — and that was going to change their tastes and what they wanted to buy. Similarly, he saw that travel was increasing. He thought cheap international airfare was going to create customers who wanted items on the shelf that reflected their travel and their education.
Likewise, he thought that network TV offered only one, homogenous advertising experience, and then people would all look at the same TV shows and they would all buy the same giant brands. He just thought that this new consumer wouldn’t want that. So he started to build Trader Joe’s for consumers that are educated, exposed to travel, and who want options that aren’t in that mainstream.
That sounds easy, but he really didn’t have a clue how to do that. The place that he got probably the biggest indication — he calls it the most important decision he made as a marketer — all came from studying wine.
Wine represented a place where the typical rules that govern grocery stores didn’t apply. Shoppers understood that wine changes by vintage, not by brand. Each year, it changes, and it’s in limited supply. It’s scarce, and it’s risky when you’re a buyer, because you have to rely on taste, rather than preconceived notions. Whereas if you’re buying Bounty paper towels or Coca-Cola, it doesn’t matter, because these are bombed out in such consistency.
The wine industry really opened his eyes to the possibility of marketing all foods like wine. When you’re a consumer, you find a good wine shop, and then you start to trust the owner of that [store]. You don’t necessarily try to master everything as a consumer. Using that as a frame for a grocery store was very novel at the time. The idea that you would find trust in a grocery store, and then they would bring you options, was a shift that he was really interested in getting people to do.
3. What role did Trader Joe’s play in bringing affordable and quality wine to American consumers via the grocery store?
California is governed by a series of laws called Fair Trade, which essentially is out to defend small chains and prevent volume buying, where you could sell products at a loss and then outsell your competitor. Fair Trade said that you have to sell foreign wine at the price that the importer imports it. Essentially what that means is that all grocery stores sold wine at the same exact price. There was no way to compete on price, which is why Joe originally opened up with 17 varieties, which at the time represented this enormous bounty of California wines.
But as Joe started to study the regulatory apparatus, he realized there was this loophole: If he could find an importer to bring in wine and ask that importer to post a price of his or her choosing, the importer could post one that was less than the dominant market. Joe found that if he got an importer to post a price, he could actually sell the wine at that price. So Joe found a friendly importer who posted wine prices way lower than anyone else in the state of California. This shattered the price of wine, and Trader Joe’s went on to sell the cheapest bottles of [international] wine in the state.
Because of that, Trader Joe’s became the leading retailer of imported wine in all of California in just a few years. He was selling Latour for $5.99, or Pichon-Longueville Lalande for $3.50. These were crazy prices for these bottles of wine because he could get his importer to post them for whatever he wanted. And he took a loss on those bottles.
4. Talk to me about Two Buck Chuck.
Joe really put an emphasis on getting his buyers to master wine from a taste perspective. There were times when they were pulling about 60 corks a week. At the Trader Joe’s central office, they had a courtyard, and he built a small tasting table in the backyard, and put up a spittoon. It just encouraged people to drink as much wine as possible, so they could learn about all different types.
The reason that matters is that I don’t think that their good luck with Two Buck Chuck can be called “luck.” It was really based on this wealth of experience in the wine industry. Two Buck Chuck was this deal that they struck, very much structured around how they could sell a very cheap bottle of wine. But it wasn’t something that a competitor could necessarily imitate, because they had a wealth of knowledge about what a good wine tasted like, and what consumers were looking for from a good wine.
So they were trying to sell an extremely drinkable, very friendly, frictionless wine that’s not exactly bad, but it’s not exactly good, either. And that’s a selling point. They knew how to find that wine, and they knew how to develop it, whereas if Target or Whole Foods or Safeway had tried to develop a wine like that, they would have whiffed, because they would have had to rely on people who weren’t as qualified.
5. What did Trader Joe’s do differently in terms of its wine selection and food selection?
Trader Joe’s has a much smaller product selection than a traditional grocery store. By shrinking the number of offerings, you can then give your buyers a chance to spend time learning about those items and putting tastes forward. Trader Joe’s is famous for private labeling things, which gives them a chance to create slightly individualized offerings around these products.
Wine is no different. Of course, it can be private labeled, and can be mixed to taste. So that same process of honing in on items and then getting expertise plays for wine as well.
6. What did Trader Joe’s do differently in terms of its management and treatment of employees and suppliers?
[Before he founded Trader Joe’s], when Joe Coulombe was running a convenience store, he decided really early on, ”Life’s too short, I want to work with better, more interesting people.” And so he pays his employees more money. He has the highest-paid employees, and that started because he decided to pay his workers average California family income levels.
This was the late ’50s, early ’60s. At that time, an individual employee tended to be a man and the sole breadwinner of the family. So individual employee income was family income. There weren’t a lot of women in the workplace. Then in the ’60s and ’70s, that shifted. Women entered the workplace, and family income went way up because there were a lot of two-breadwinner houses.
But Joe was kind of stubborn, and he just had this idea that he was going to stick with paying his individual employees average California family income levels. All of a sudden, he’s paying these people much higher than market rate in an industry that used to be paying people less, so he has access to a much better quality of employee.
7. Who is “Trader Joe” and what was it like interviewing him for this book?
Oh, it was such a pleasure. Sadly, he is no longer with us. He died in February of this year. But he was a really brilliant guy.
He could see around corners. He could make connections between different things. I started off the Trader Joe’s section of this book pretty cynical. I thought with Trader Joe’s — because it seems like it offered healthy food at cheap prices and all the employees were happy — that something’s too good to be true here.
And the book itself gets pretty dark in places, but it was really a pleasure to meet Joe and realize that a big reason that Trader Joe’s is so successful was because he was just brilliant, and he saw the world differently, and he valued things like paying people a decent wage, creativity, and creating options that were individualized and would meet his consumers’ desires.
I think a lot of that did come from his experience, with his ability to see things and invest in learning about them. Wine is the best example of that. He did not grow up a wine drinker. When he founded Trader Joe’s, he would drink cooking sherry to relax. He was not a gourmand, but he realized wine was going to be big, and he decided he was going to learn about it. He poured himself into wine — pulling 60 corks a day sometimes — and just learning as much as he could. That gives you a sense of the type of guy he was.
Ed. note: This interview has been edited for length and clarity.
Published: December 28, 2020