Stephen Dubner

In a 2011 interview with the LA Times, Joe Colombe said that when he started Trader Joe's in the 1960s, he was inspired by an article he read in Scientific American about the huge spike in Americans attending college. I felt this newly educated class of people would want something different, he recalled, and that was the genesis of Trader Joe's.

In a 2011 interview with the LA Times, Joe Colombe said that when he started Trader Joe's in the 1960s, he was inspired by an article he read in Scientific American about the huge spike in Americans attending college. I felt this newly educated class of people would want something different, he recalled, and that was the genesis of Trader Joe's.

Why did he choose Pasadena as the first store location? Because, he said, Pasadena is the epitome of a well-educated town. Trader Joe's is for overeducated and underpaid people, for all the classical musicians, museum curators, and journalists, he said.

Why did he choose Pasadena as the first store location? Because, he said, Pasadena is the epitome of a well-educated town. Trader Joe's is for overeducated and underpaid people, for all the classical musicians, museum curators, and journalists, he said.

Why did he choose Pasadena as the first store location? Because, he said, Pasadena is the epitome of a well-educated town. Trader Joe's is for overeducated and underpaid people, for all the classical musicians, museum curators, and journalists, he said.

This suggests that from the very beginning, Trader Joe's understood cream skimming, targeting a certain kind of customer and letting the rest slide by. As for the underpaid part of Cologne's equation, that would appear to be outdated.

This suggests that from the very beginning, Trader Joe's understood cream skimming, targeting a certain kind of customer and letting the rest slide by. As for the underpaid part of Cologne's equation, that would appear to be outdated.

This suggests that from the very beginning, Trader Joe's understood cream skimming, targeting a certain kind of customer and letting the rest slide by. As for the underpaid part of Cologne's equation, that would appear to be outdated.

An analysis by the research firm AgData found that Trader Joe's stores today are located in counties with higher household median income than any other grocery chain, including Whole Foods, and about $10,000 higher than the U.S. median income. But, and this seems to be another key component of Trader Joe's success, they also value frugality.

An analysis by the research firm AgData found that Trader Joe's stores today are located in counties with higher household median income than any other grocery chain, including Whole Foods, and about $10,000 higher than the U.S. median income. But, and this seems to be another key component of Trader Joe's success, they also value frugality.

An analysis by the research firm AgData found that Trader Joe's stores today are located in counties with higher household median income than any other grocery chain, including Whole Foods, and about $10,000 higher than the U.S. median income. But, and this seems to be another key component of Trader Joe's success, they also value frugality.

As Michael Roberto found, they usually set up shop in the cheaper parts of the expensive areas.

As Michael Roberto found, they usually set up shop in the cheaper parts of the expensive areas.

As Michael Roberto found, they usually set up shop in the cheaper parts of the expensive areas.

The real estate firm Zillow found that homes near Trader Joe's stores appreciate more quickly than homes in the city as a whole, concluding that either Trader Joe's is really good at picking areas that are on the rise or that they are in part causing the rise. So how about a new store in Seward, Alaska? That is Kirk DeSermia's dream.

The real estate firm Zillow found that homes near Trader Joe's stores appreciate more quickly than homes in the city as a whole, concluding that either Trader Joe's is really good at picking areas that are on the rise or that they are in part causing the rise. So how about a new store in Seward, Alaska? That is Kirk DeSermia's dream.

The real estate firm Zillow found that homes near Trader Joe's stores appreciate more quickly than homes in the city as a whole, concluding that either Trader Joe's is really good at picking areas that are on the rise or that they are in part causing the rise. So how about a new store in Seward, Alaska? That is Kirk DeSermia's dream.

Unless you think DeSermia is one of those guys who makes a Facebook page for everything.

Unless you think DeSermia is one of those guys who makes a Facebook page for everything.

Unless you think DeSermia is one of those guys who makes a Facebook page for everything.