Meal Kits Delivery Services in the U.S., 2nd Edition
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Meal kit delivery services have taken off over the past few years, serving millions of meals to tens of thousands of customers. But now the category appears to have reached a moment of reckoning. Blue Apron, the best known of the category’s competitors announced an initial public offering in early June that generated a lot of press but was received with only tepid interest from investors. Has the category hype been overblown? Is it destined to implode? Or is there a path to success that may not run through Wall Street?
Packaged Facts’ new report,
Meal Kit Delivery Services in the U.S., 2nd Edition, takes a look at these questions and offers an up-to-date analysis of where meal kit delivery systems fit within the food industry and where the opportunities may lie for future growth. For those not familiar with the concept, the services offer people a convenient way to cook at home without having to do the meal planning and grocery shopping. Online portals let consumers order meals ahead from picture menus showing beautiful photos of the finished dish, and the services deliver the pre-measured fresh ingredients along with recipes to their doorstep to help them cook chef-like meals at home.
Meal Kit Delivery Services and the Food Industry
The U.S. grocery industry greatly overshadows the meal kit delivery service market segment in terms of revenue. Nevertheless, meal kit delivery is a disruptive force in the food industry. The meal kit delivery services segment is one of the industry's strongest examples of the movement toward providing greater convenience in eating fresh foods to the consumer. Meal kit delivery services also fall within the context of electric ordering of groceries for pick up or delivery from brick and mortar grocery retail.
Meal kit delivery addresses the ever-growing demand for convenience. Retail grocers and foodservice operators alike bear more of the burden of getting food to the consumer and to the table. Working and pareting consumers pressed for time are those typically associated with the trend toward convenience in the food industry. Younger consumers who have not necessarily been schooled in how to prepare meals have also been a demographic accepting of meal delivery services.
Blue Apron, perhaps the best known meal kit delivery services company, announced its initial public offering at the beginning of June with the goal of raising up to $586.5 million to cover operating expenses and capital expenditures related to the company's expansion plans, including a broader marketing outreach. By the end of June it was clear that Blue Apron would not meet its objective.
Other participants in the meal kit delivery services industry may pause their own IPO considerations due to the underwhelming response to the Blue Apron IPO. Food industry companies not in the meal kit delivery category, or only in a test stage with meal kit delivery services, may also now consider how best to participate in the meal delivery industry.
Retail grocers, foodservice operators, convenience stores, and other types of food marketers are taking steps to offer their own meal delivery services and products that provide convenience.
Some food manufacturers are entering the meal kit delivery industry on their own, not content to merely offer meal kit ingredients or be investors in meal delivery services. Tyson Foods is the most prominent to date, having launched its Tyson TasteMakers line of "chef-inpspired", ready-to-cook meal kits in 2016.
Scope & Methodology
Packaged Facts' newest edition of Meal Kit Delivery Services in the U.S. covers online meal kit delivery services, as well as the companies that offer and deliver to consumers' doors fresh ingredients for one or more meals. Meal delivery services promise convenience by eliminating the need to plan meals, find recipes, and shop for groceries.
The report looks at the latest developments in the category beyond the Blue Apron IPO, including recent investments in some of the other category leaders by top international food companies. It also examines the potential impact on the meal kit delivery services category by the pending Amazon acquisition of Whole Foods Market and also by the rapid expansion of the grocery delivery service Instacart. In addition, the report identifies some of the most promising up-and-coming meal kit companies and what they are doing to distinguish themselves in among the many new contenders.
Packaged Facts examines meal kit delivery services in the context of both the retail grocery industry and the foodservice industry. Although accounting for less than one percent of overall grocery sales in the U.S., meal kit delivery service have garnered lots of attention, perhaps because they are the most colorful example of the movement toward providing greater convenience to the consumer. This movement includes electronic ordering of groceries for pick up or delivery from brick and mortar groceries, supermarkets, and convenience stores as well as online sales of grocery items from e-retailers.
Meal Kits Delivery Services in the U.S., 2nd Edition examines:
- The competitive environment among leading meal kit delivery services
- Several new, up-and-coming entries in the meal delivery services industry
- Past meal kit delivery services that were unsuccessful
Packaged Facts examines the competitive environment in which meal kit delivery services must strive for consumer attention. This includes a review of the various other methods by which by which consumers can obtain at home meals from both the retail grocery and foodservice channels, as meal kit delivery services are one element within an increasingly complex "omnichannel" food delivery universe. Emphasis is put meal kit delivery's impact on other food delivery channels.
The heart of the matter is how food gets to consumers. What has emerged in the last few years is the growing demand for more convenience which translates to both the retail grocer and the foodservice operator bearing more of the burden of getting food to the consumer. Most often this trend is attributed to consumers being pressed for time because of work and/or parenting demands. It has also been suggested that younger consumers have not been schooled by their parents in how to prepare meals, which has been an important element in the acceptance of meal kits delivery services.
Meal Kit Delivery Services in the U.S., 2nd Edition uses consumer data gathered through Packaged Facts’ Online Consumer Survey of some 2,000 adult consumers conducted in May and June 2017. Information on company animal welfare activities was gathered from an in-depth search of corporate websites and food industry trade publications, with data on the activities of government and non-governmental organizations obtained from a thorough review of their publicly available sources.