instore - March 2018 - 28

feature

The deal with

meal kits

They're apparently here to stay,
so how are retailers taking advantage?
by Ryan Atkinson

A

year ago, inside Chicago's McCormick Place, supermarket executives spoke to others in their industry as part of the National
Restaurant Association's Foodservice @ Retail symposium.

What's the advantage for retailers to just now make a strong push?
Simply, they've been able to watch the game and take notes.
"Companies like HelloFresh and Blue Apron, they were real innovators
and pioneers in this category, but the general population of retailers out
there were sort of late to the party and these e-commerce companies
got a kickstart," Uetz says.

A year later, the picture is a little clearer. Meal kits are a force to be
reckoned with. Market research firm Packaged Facts has pegged the
meal kit market at $5 billion. And that figure has reached into the
supermarket world. Seemingly every week since last year's NRA
show, another retailer has announced a meal kit initiative in one form
or another, whether it's a meal kit line of their own or the outright
purchase of a meal kit service.

The retail industry has been able to learn from the mistakes of the
e-commerce company, watching and taking notes as reports surface
of meal kit subscription services struggling to retain customers once
introductory offers end. In fact, Blue Apron reported a 13 percent net
revenue decrease in the fourth quarter of 2017.

"What we're seeing now is that everybody is aware that there's an
opportunity here," says Michael Uetz, managing principle at
industry consulting firm Midan Marketing. "Everybody
seems to be stepping up to the challenge. I've been
really impressed that almost every day I read about
another retailer who has made an investment of
some form in trying to create alternatives for their
customers that are going to save them time and help
them in their meal preparation."

"The industry continues to learn from the challenges that some of
these e-commerce companies have had," Uetz says. "I think those
companies had an uphill climb when
they entered the marketplace
because they were starting from
scratch and building databases,
understanding consumer needs,
understanding where to get to
consumers in their purchasing
path where they could engage
them at the right time."

Late to the party
The triumvirate of meal kit companies - HelloFresh,
Blue Apron and Plated - entered the U.S. market
somewhat contemporaneously in 2012. According to
an Inc Magazine report from 2017, there are now more
than 150 meal kit companies in the United States.

28 * MARCH 2018 * instore

Meijer's take on meal kits
consists of pre-packaged
ingredients meant to
inspire consumers' recipes
and dinner choices.

MEIJER, PLATED - FACEBOOK

When the topic of meal kits came up, the general consensus was that it
was still too early in the game to really tell what was going to happen.



Table of Contents for the Digital Edition of instore - March 2018

instore - March 2018
Need to Know - Dabates and definitions
Spotlight - By the numbers
Merchandising - Branded baked goods
Specialty Insights - Organic deli products
Cover Story - Bi-Rite Market's Sam Mogannam
Commissary Insider
Insight Insider - Bi-Rite commissary
Equipment - Pizza Production
Food Safety - Allergen detection
Packaging - Grab 'n Go grabs market share
R&D - Investing in the Silicon Valley of food
Equipment & Packaging - Latest innovation: Frying technology
instore - March 2018 - instore - March 2018
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instore - March 2018 - 7
instore - March 2018 - Need to Know - Dabates and definitions
instore - March 2018 - 9
instore - March 2018 - Spotlight - By the numbers
instore - March 2018 - 11
instore - March 2018 - Merchandising - Branded baked goods
instore - March 2018 - 13
instore - March 2018 - 14
instore - March 2018 - 15
instore - March 2018 - Specialty Insights - Organic deli products
instore - March 2018 - 17
instore - March 2018 - 18
instore - March 2018 - 19
instore - March 2018 - Cover Story - Bi-Rite Market's Sam Mogannam
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instore - March 2018 - Insight Insider - Bi-Rite commissary
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instore - March 2018 - Equipment - Pizza Production
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instore - March 2018 - 41
instore - March 2018 - Food Safety - Allergen detection
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instore - March 2018 - 45
instore - March 2018 - Packaging - Grab 'n Go grabs market share
instore - March 2018 - 47
instore - March 2018 - 48
instore - March 2018 - 49
instore - March 2018 - R&D - Investing in the Silicon Valley of food
instore - March 2018 - 51
instore - March 2018 - Equipment & Packaging - Latest innovation: Frying technology
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