Meal Kits Delivery Services in the U.S., 2nd Edition

Published: July 7, 2017 - 128 Pages

Table of Contents

  • Executive Summary
    • Overview
      • Scope of Report
      • Report Methodology
      • Meal Kit Delivery Services at $4.65 billion in 2017
      • Meal Kit Delivery Services Projected at $11.6 billion by 2022
      • Meal Kit Delivery Services and the Food Industry
      • Food Industry Reactions to Meal Kit Delivery Services
      • Consumers: Convenience and Meal Solutions
      • 17% of Adults Receive Delivery Service Fresh Meal Kits
      • 90% of Fresh Meal Kit Delivery Subscribers Would Recommend This Service to Friends
      • Millennial, Urban, and Natural Foods Skew to Customer Base
    • Market Participation Opportunities
      • Fresh Fields for Food Suppliers
      • Working the Learning to Cook Curve
      • To Niche or Not to Niche
      • Working the Clock and the Calendar
      • Celebrity Tie-Ins
      • Organizational Tie-Ins
      • Tie-Ins with Hospitality Industry
      • Establishing External Rewards Programs
      • Getting Ahead of the Curve (or Back to the Future) on Eco-Friendly Packaging
      • Meal Kit Providers and Packaged Food Companies as Frenemies
  • Market Overview
    • Key Points
    • Disrupting the Food Industry
      • A Niche but Critical Challenge to the Grocery Industry
      • The Online Grocery Revolution
      • Challenging Foodservice as Well as Groceries
    • The Heart of the Matter: How Food Gets to the Consumer
    • Meal Kits One Option Among Many
      • Everything Old Is New Again
    • Two Way Challenge to Meal Kits
      • Meal Kit Delivery Services at the High End
    • Why Meal Kits?
      • Meal Kit Delivery Services and the Triple Haters
        • Table Consumer Food Delivery Likes and Dislikes
      • How Meal Kit Delivery Services Work
      • Subscription Plans Most Common
      • No Subscription Option
      • Competing on Price
      • The Attractions of Meal Kit Delivery Services
      • The Downside of Meal Kit Delivery Services
    • The Market
      • A $5 Billion Market?
      • Market Projection
        • Table Blue Apron Revenue Growth
        • Table Estimated and Projected Sales of Fresh Food Meal Kit Delivery Services: 2016, 2017, and 2022 (in billions of dollars and percentage change)
      • The Amazon Factor
      • Can Success Lead to Obsolescence?
      • Future Directions for Meal Kit Delivery Services
    • What Didn't Work
    • Blue Apron, Amazon, and Instacart
    • Blue Apron's IPO
      • Significance for Category as a Whole
      • Should Blue Apron Be Acquired?
      • Blue Apron Acquires BN Ranch
      • Impact of Blue Apron IPO on Amazon/Whole Foods
      • Impact of Blue Apron IPO on Instacart
    • Amazon and Whole Foods
      • Whole Foods Tests Purple Carrot, Salted, and Its Own Branded Meal Kits
      • Impact on Grocery Industry
      • Impact of Amazon/Whole Foods Deal on Blue Apron
      • Impact of Amazon-Whole Foods Deal on Instacart
    • Instacart's Expanding Presence
      • Table Instacart's Partner's and Distribution Range
      • Impact of Instacart Expansion on Amazon/Whole Foods
      • Impact of Instacart Expansion on Blue Apron
    • Investment Support for Meal Kit Competitors
    • Social Media a Key Marketing Platform
    • Current Developments Among Meal Kit Delivery Services
      • Blue Apron
      • Chef'd
      • Green Chef
      • HelloFresh
      • Home Chef
      • Martha & Marley Spoon
      • PeachDish
      • Plated
      • Purple Carrot
      • Sun Basket
      • Terra's Kitchen LLC
    • Up and Coming Meal Kit Delivery Services
      • BurgaBox
      • Farmhouse Delivery Supper Club
      • Feastive
      • Foodstirs
      • Gobble
      • Good Eggs
      • Handpick
      • Kitchen Table
      • One Potato
      • Thai Direct
  • Meal Kits Impact on Food Industry
    • Key Points
    • The Food Industry Responds
    • Meal Kits from Retail and Online Groceries
      • Kroger Enters Meal Kit Competition
      • Publix Offering Meal Kits
      • Giant Eagle Includes Meal Kits Among Many Options
        • Table Giant Eagle/Market District Meal Solutions
      • Hy-Vee Offers Chef in a Box
      • Coborn's Expands Meal Kit Program
      • Gelson's Offers Salted Interactive Meal Kits
      • Peapod's Expanding Meal Kit Offerings
    • Meal Kits and Grocery Manufacturers
      • Did Meal Kit Convenience Spur Click and Collect?
    • Meal Kits Push Convenience in Convenience Stores
    • Meal Kits and Foodservice
    • Meal Kits and "Ready-To-Eat" Home Delivery
    • Meal Kits Impact Other Consumer Categories
  • The Consumer
    • Key Points
    • Food and Meal Delivery
      • Half of Adults Have Ready-to-Eat Food Delivered, Mostly from Chain Restaurants
      • One-Third Have Had Grocery, Meal Kit, or Diet Management Prepared Meals Delivered
      • Amazon Role in Food and Grocery Delivery
      • One-Fifth of Amazon Prime Users Are AmazonFresh Customers
      • Food and Grocery Is the #2 Subscribe-and-Save Category
        • Table Usage Rates for Amazon Grocery Delivery Services, 2017 (percent of U.S. adults
    • Meals at Home
      • Meal Kit Subscribers Cook More, Not Less
      • Home Meals Remain Most Often Prepared from Scratch
        • Table How Meals at Home Are Prepared or Procured, by Frequency, 2017 (percent of U.S. adults)
    • Awareness and Use of Meal Kits
      • One-Third of Adults Have Purchased Fresh Food Meal Kits, Broadly Defined
      • 73% Awareness of Meal Kit Delivery Services Is Primary Due to Aggressive Advertising
      • Time, Effort, and Expense the Top Reasons for Quitting Meal Kit Delivery Service
      • Time Saving, Quality and Variety of Options, and Enjoyment Are Most Important Features of Meal Kit Delivery Services
      • Nine out of 10 Subscribers Would Recommend Meal Kit Delivery Services
        • Table Level of Agreement with Statement: "I Would Recommend Meal Kit Delivery Service to my Friends," 2017 (percent of current meal kit service subscribers)
    • The Fresh Meal Kit Delivery Service Subscriber
      • Demographic Profile of the Meal Kit Services Subscriber Trends Markedly Upscale
        • Table Demographic Characteristics of Fresh Meal Kit Delivery Service Subscribers, 2017 (index)
      • Meal Kit Subscribers Are Heavy Users of Online Shopping Services
        • Table Online Ordering and Purchasing Activity: All Adults vs. Current Meal Kit Delivery Service Subscribers, 2017 (percent and index)
        • Table Demographic Characteristics of AmazonFresh Users, 2017 (index)
      • Meal Kit Subscribers Are More Diet Conscious
        • Table Level of Agreement with Statement: "I Follow a Special Diet for Health and Wellness," 2017 (percent of U.S. adults vs. current meal kit service subscribers)
      • Meal Kit Subscribers Favor Natural Food and Specialty Stores for Grocery Shopping
      • Quality, Organics, and To-Go Options Are Desirable in a Grocery Store
      • In Product Selection, Meal Kit Subscribers Favor Local, Natural, Animal-Friendly
        • Table Level of Agreement with Statement: "I Buy Fresh, Natural Ingredients for Cooking," 2017
        • Table Level of Agreement with Statement: "I Prefer Using Local Cooking Ingredients," 2017
        • Table Level of Agreement with Statement: "I Look for Specific Nutritional Ingredients in the Foods I Eat," 2017 (percent of U.S. adults vs. current meal kit service subscribers)
        • Table Level of Agreement with Statement: "I Prefer to Buy Packaged Food or Beverage Groceries from
        • Table Level of Agreement with Statement: "I Prefer to Buy Packaged Food or Beverage Groceries from Specialty/Natural Companies Rather than from Large Food Companies," 2017


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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.

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