Whole Foods Market

By Jesse Carter

Background Information

• Founded in 1980 in Austin, Texas• 1984: expansion out of Austin

began• Opened new stores from the

ground up• Throughout the 90s, acquired

other natural food chains• Global expansion starting in 21st

century• Currently has 39,000 employees

and 193 stores

First Whole Foods Market

Image from http://www.wholefoodsmarket.com/company/history.html

Philosophy

• Motto: “Whole Foods, Whole People, Whole Planet”

• Declaration of Interdependence—created originally in 1985

• Core values, quality standards, and future plans are extensive lists

Some Questions

• How many of you have shopped at Whole Foods before?

• How many of you shop there regularly?

• Why?

Whole Foods and The Long Tail

• Each store designed uniquely for its locale

• Natural/organic food market is its own niche

• Ability of customers to spend time in store doing things other than shopping

• Major brands and the niche market

• Whole Foods is still a supermarket

Whole Foods and The Long Tail

• Early this year, Whole Foods Inc. increased the salary cap for executives

• In an open letter, founder John Mackey called the cap necessary to maintain executive talent

• Defended the move by reminding everyone that 93% of the company’s stock options are distributed to non-executive employees

• Question: Can companies in niche markets stay profitable and maintain their core philosophies at the same time?

Whole Foods and Democratizing Innovation

• Offered $10 million in low-interest loans to small farmers who grow their crops organically

• Allow each store’s locale to determine its specific attributes

• “Democratization” of pay—CEO (Mackey) is no longer paid for his services– Do you think he is a lead user

doing his work for the pure enjoyment of it?

Whole Foods and Democratizing Innovation

• Pay structure is still very hierarchical

• Grocery store model can be limiting in terms of innovation

Whole Foods and The Wealth of Networks

• Space provided for the common community of shoppers to get together

• Whole Foods website– John Mackey’s blog, where users

can read and comment•http://www.wholefoodsmarket.com/

blogs/jm/

– Podcasts•http://

www.wholefoodsmarket.com/podcasts/

Laws of Simplicity (Fitting)• Reduce—only organic products • Organize—layout groups certain

items together• Time—make waits more tolerable

with free sample• Differences—simple philosophy

with complicated parts—provides balance

• Emotions—people’s strong feelings about healthy foods and healthy environmental practices met

• Trust—consumers trust grocery store model generally and Whole Foods specifically

Laws of Simplicity (Not Fitting)

• Reduce—offers huge range of organic food products, natural body supplements, skincare products, etc.

• Organize—each store is unique to its locale, thus each store is organized differently

• Time—not designed to get you in and out quickly