There’s an interesting strategic play being made by Whole Foods Market. In the midst of the company’s nearly $2 billion one-day drop in market value a few weeks ago came the announcement of a shareholder lawsuit. Whole Foods had already come under legal pressure concerning claims of overcharging, but this new lawsuit claims securities fraud.

Now, when shareholders file a lawsuit like that, it’s not a good thing. Especially not when Millennial buyers—those between the ages of 18 and 34, and a segment Whole Foods has failed miserably in attracting—snicker at the chain’s exorbitant prices and refer to it as “Whole Paycheck.”

Whole Foods has decided to adopt a market-segmentation strategy to reverse its downward trend—a strategy aimed squarely at Trader Joe’s, a solid Millennial brand. Whole Foods plans to launch a chain of smaller, lower-priced stores that focus entirely on stock bearing the Whole Foods private label, 365.

Whole Foods is going to try to out-Trader Joe’s Trader Joe’s. This should be fun to watch, strategically speaking.

If you’ve never shopped at either Whole Foods or Trader Joe’s, know this: Trader Joe’s is a loved brand by nearly every segment, not simply the Millennials, and not simply because of its low prices, but also because of its unique product and shopping experience based on simply being human.

 …