Welcome to Packaged Facts' all-in-one Meal Kit Delivery Services page! You'll find all the information you need concerning the maturing meal kit delivery industry through our market research reports, blog posts, press releases, videos, & multimedia, all consolidated for your convenience.

Why Meal Kit Delivery?

With sales estimated at $1.5 billion, the meal kit delivery business is an attractive food & beverage market segment for the food industry. But there's another reason why so many Americans strapped for time are choosing meal kit delivery services over grocery retailers or restaurant takeout. Consumers who have little time to spend on meal prep see meal kit delivery convenient for many reasons.

Most meal delivery services operate similarly by offering accessible and attractive websites. Consumers are treated to menus full of current (and sometimes future & previous) recipes replete with high-quality photographs. Marketers in the meal delivery industry are finding a "sweet spot" with consumers who do not have the time, inclination, or know-how to shop for individual food ingredients, and it's no wonder that marketers across the entire food industry spectrum are climbing aboard the maturing and exciting meal kit delivery services industry.

More consumers are choosing meal delivery services for convenience

Blue Apron & Meal Kit Delivery's Maturation 

To date, Blue Apron has consistently been the company most readily identifiable as the meal kit delivery industry's leader. For a company that specializes in getting people to cook in the privacy of their own homes, meal delivery giant Blue Apron has made a name for itself in a very public way.  The company's IPO is among the first in the food industry's maturing meal kit delivery market segment. "As a leader and innovator in this still very new food sector, Blue Apron's IPO filing hints at the viability of meal kit deliveries as they mature from startups to fully realized and potentially profitable business investments," says David Sprinkle, research director for Packaged Facts. The move is a sign of an increasingly competitive and crowded meal kit delivery services market, one that has seen many startup companies fall short of attaining profitability. 

Packaged Facts recently delved into the young and exciting meal kit industry with its report, Meal Kit Delivery Services in the U.S., 2nd Edition, exploring online meal kit delivery and the companies that offer and deliver to consumers' doors. 

The majority of meal delivery companies emphasize - for the moment - the meal kit delivery services market's potential profitability. Blue Apron's recent IPO filing signals a possible shift in the meal delivery industry, wherein many companies must focus on costs of expansion such as establishing facilities, hiring new and more employees, and drawing customers in with discounts. With so many costs of expansion, it seems likely that many meal delivery services won't be making much money before they can solidify their business operations and ensure a loyal and large enough consumer base. 

"Blue Apron's IPO filing hints at the viability of meal kit deliveries as they mature from startups to fully realized and potentially profitable business investments." 

The meal kit delivery services industry may not be known for its universal profitability, but it is certainly a growing industry. Meal kit delivery has exploded in recent years because of the niche it fills between home-cooked meals and restaurant takeout. According to Packaged Facts' research, the U.S. meal kit delivery market has ales of $1.5 billion as of 2016, and it there seems little doubt about big-name players such as Blue Apron playing a significant role. 

Blue Apron's recent IPO is in line with Packaged Facts' market outlook analysis, which anticipated the meal kit delivery services' industry's biggest players going public. As the meal kit delivery industry's main competitor, Blue Apron's IPO was met with relatively tepid investor interest despite the large amount of press it has generated. By the end of June, it was clear that the company would fall short of its initial monetary objective. Food market analysts' explanations for the lukewarm response to Blue Apron's IPO were broad, ranging from the impact of Amazon's bid on Whole Foods, to an association of Blue Apron with the (currently) unpopular tech stocks, to skepticism about the potential for actual profits in the meal kit delivery industry as a whole. 

Other meal kit delivery industry participants may think twice when considering their own IPOs, in light of the underwhelming response to Blue Apron's. Food industry companies not engaged in meal kit delivery will likely view the public resopnse as a reason to reconsider how best to engage in the developing market for meal kit delivery services.

Despite the response to Blue Apron's IPO, Packaged Facts projects that the meal kit delivery services industry is on a path to continued success. Consumers continue to reach well to meal kit delivery's fresh, high quality ingredients. Also boding well for the industry's future are multiple meal kit delivery services reporting success, as well as Amazon's deepening presence in the still-young market for meal kit delivery. 

Meal kits' fresh, quality ingredients have proven to be a huge attraction to consumers who might not want options from grocery retail or foodservice. While meal kit delivery will not replace in-person grocery shopping or cooking from scratch, it is still in the food industry's spotlight. Meal kit delivery marketers must showcase their products as fun, convenient and reasonably priced while still holding on to meal kits' "specialness". Looking ahead, the meal kit delivery industry may see its greatest challenges coming from supermarkets that create fresh food meal kits and offer them through same-day delivery via partnerships with services like Instacart

Meal Kit Delivery Services in the Food Industry 

The grocery industry's total revenue overshadows that of the meal kit delivery services market segment. Nevertheless, meal kit delivery is on the rise and is a potential market 'disruptor'. Meal kit delivery services are the food industry's most prominent showcase of greater fresh food convenience delivered to consumers. Meal kit delivery also falls within the context of electronically ordering groceries for pick-up, or delivery from brick-and-mortar grocery retail, supermarkets, and convenience stores, as well as online grocery sales from the grocery industry's e-commerce players.

Consumer demand for convenience translates to both retail grocery and foodservice channels bearing moree of the burden of getting food to the consumer and to the table. This shift of responsibilities is a trend typically attributed to consumers pressed for time because of work and/or parenting demands, though discretionary time devoted to home entertainment, internet browsing, and social media is surely part of the equation. Younger consumers concerned about meal preparation may not know how to best prepare meals once they've purchased ingredients. Lack of kitchen know-how is a contributing factor to the rise in acceptance of meal kit delivery services by younger consumer demographics.

There are many retail grocers, foodservice operators, convenience stores, and other types of food marketers that are deciding to innovative their own meal kit delivery services, rather than allow the burgeoning industry to take too strong a hold on their revenue streams. Tyson Foods is the strongest example to point to, having launched its 'Tyson TasteMakers' line of chef-inspired, ready-to-cook meals in 2016.

Supermarket Chains Taking Action in the Meal Kit Delivery Services Industry include: 

  • The Kroger Company,  which announced that it was directly entering the meal kit delivery industry in May 2017 with 'Prep + Pared'. The program launched in four stores in Kroger's headquarter city of cincinnati, with plans to expand to more locations in the area.
  • Publix Super Markets, which began testing a product line at  two of its Florida locations, in Tampa and Orlando. The meal kits are a variation on the typical product, in that they come in three levels of preparation-readiness: simplest, or heat and eat; simpler, taking up to four steps; and simple, requiring as many as six steps. 
  • Giant Eagle,  which began offering meal kit delivery services under the label 'Market District Fresh in :30' meal kits. The chain positions the meal kits as one of several meal options – ready-to-eat, ready-to-heat, and ready-to-cook – provided to its shoppers.
  • Hy-vee, a chain of supermarkets that began its "Chef in a Box" meal kits program in August 2016. Hy-vee has since expanded its meal kits program to several other stores. 
  • Coborn's Inc., a 95-year-old employee-owned grocery retailer with 55 locations across the Upper Midwest, introduced 'To the Table' meal kits in 2016. The meal kits are delivered through the CobornsDelivers system. In 2017, it announced it would be expanding its menu, addressing a large consumer demand in the meal kit market by adding breakfast and dessert kits. 
  • Gelson's, a popular California supermarket chain, announced in January 2017 that it would be offering 'Salted Cooking Kits' created by Salted, an online cooking school with over 200 celebrity chefs from the across the U.S. The kits are uniqe in that each one includes a link to an online video of an award-winning L.A. chef offering step-by-step instructions on how to prepare the meal kit. 
  • Peapod.com, one of the U.S.' most prominent online grocers, began offering its own meal kits in the Chicago area in 2014, making it a pioneer among grocers in the meal kit delivery services industry. 

Who is Purchasing Meal Kits?

Simply stated, consumers want convenience and also like to cook. About half of U.S. adults have ordered pizza for home delivery in the last 30 days, 40% have had home delivery of some other type of ready-to-eat food or meal, and 20% have ordered groceries. More than nine in 10 U.S. adults cook at home, and cooking from scratch remains the most frequent way of preparing a meal, with 70% of shoppers doing so three or more times a week. 

Although there is considerable attrition in use of meal kit delivery services, particularly after free or discounted product trials, almost all current fresh meal kit delivery services subscribers are using the company they originally signed up with, and nearly that entire percentage would recommend fresh meal kit delivery services to their friends. Time saving is the most desirable aspect of meal kit delivery services, but quality, variety, and healthfulness in meal selections are also highly valued, as are learning how to cook new things and sharing meals and experiences. 

Age-between 25 and 44 years old-is the strongest predictor of who uses fresh meal kit subscription serves. Meal kit services subscribers are disproportionately inclined to have ordered products or services online in the last three months and to have purchased something online in the last seven days. 

Meal kit delivery services subscriber demographics