Goodbye Grocery Stores?

Clearly after reading all of the ISYS6621 blog posts and from the popularity surrounding snack time, our class loves food. One common trend that I’ve noticed is increasing in popularity is the meal kit delivery services such as Blue Apron and Hello Fresh. I remember first hearing about these and thinking how genius it was—it gives you the ingredients, perfectly proportioned, for a specific recipe. It takes the time out of not only choosing what to have for dinner, but also out of wandering around the grocery store looking for one obscure item that you question if the recipe really needs.

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Personally, my roommates and I love our weekly Wegman’s trip… partially because one of them is our in room chef and makes us dinner every night. But after interning in the “real world” all summer (without my chef roommate around) I realize how convenient these meal delivery kits would be. Having all the ingredients ready for you and the recipe laid out in front of you would mean a lot less takeout for someone like myself who usually resorts to that.

The value of these meal kits are the main point of question—the subscriptions generally end up with meals costing around $9.99 per serving—more expensive than going to the grocery store. 29% of millenials say that they have tried a meal kit delivery service and 26% of Gen-Xers. The market is saturated with many different options—some geared toward organic eaters, some for the more cost conscious, and some that require more prep. Tom Brady has even entered the market with his TB12 meals (because who wouldn’t want to be like Tom Brady??)

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With these services offering a website and many also having an app, it’s easy to choose your meals, pause your subscription, and manage on the go. With people becoming more reliant on their phones it’s no wonder that plans like these have began to take off. While not a direct competitor to Instacart and other grocery delivery services, they do provide the same advantage of convenience.

While I have never tried these kits (on a college student budget here), I did see a kid picking up his Blue Apron box from the mail room the other day. I would be curious to try a couple different ones to see if I preferred one to another or if they were all pretty similar. For anyone interested in a comparison a blogger did one here and Time did one here.

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It’s crazy to think that grocery shopping—such a staple in people’s everyday lives—is being disrupted by not only grocery delivery services (Instacart has a separate checkout section at the Chestnut Hill Wegmans), but also by meal kit delivery services. It’s clear that Albertsons feels this pressure as they have now hopped on board with the trend by acquiring Plated. Amazon is also reportedly going to make a move to enter the market as they have expanded their presence in the grocery industry after their acquisition of Whole Foods. It will be interesting to see how other grocery stores react to this change in the market.

 

8 comments

  1. Hi, Hilary! Great post! I was actually just talking to my mom about possibly signing up for one of these meal kit services so I found the comparisons you linked to be very helpful.
    If you are curious (like me) here is a good article I found with some more related stats on this $2.2 billion industry:

    https://www.usatoday.com/story/money/business/2017/07/03/home-meal-kit-phenomenon/102544292/

    It’s interesting to see how it is widespread across different regions of the US, how more specialized services catering to different diets are popping up, and how celebrity endorsements are now affecting the market.

  2. fernanfu89 · ·

    Really interesting article! I do agree with you that as time passes, more and more people are looking for more convenient ways to shop for food. That’s why all these companies like blue apron and Hello fresh are surging. The question is as you mention with so many choices are all these going to destroy the market or will people use other more convenient alternatives such as the prepared foods at amazon.

  3. Sheritta Coleburn · ·

    I have personally tried Hello Fresh and thought it was great! I’m not a huge fan of grocery shopping and sometimes forget to make a list and other times I have no real clue what I want to get. Hello Fresh made it easier to pick out my meals for the week with less prep to make. I loved how everything was portioned already out for me, and also helped me to not overindulged. I sometimes just found it hard to find time to cook the meals in my very busy scheduled and once accidentally left an uncooked meal to spoil in the fridge. :(

  4. kaitlinardiff · ·

    Haha it’s so true how our class loves food! I’ve actually used Blue Apron a few times and didn’t love it. While the quick prep/cook time is nice, I didn’t think that any of the meals justified the hefty price tag compared to what I could buy at the grocery store. There are also very few options of what to eat, as each week only has about 6-8 recipes, which offers very variation, especially if you have a dietary restriction. I think that Blue Apron’s post-IPO struggle is evidence of a popular agreement with my opinion. Since our generation is so into personalization, I think Blue Apron needs to really find a niche of how to cater towards this desire towards personalization and that will be the key to their success.

  5. lwennbie · ·

    I love reading about this topic. Great post (also I just sent so many people I know a link to Tom Brady’s meal kit…). I agree with the above post by @kaitlinardiff that I think the post-IPO struggle of Blue Apron shows the difficulty facing this industry in general. I was reading about how Amazon’s entry into the grocery market, with its purchase of Whole Foods, really affected Blue Aprons IPO performance. I think people are nervous, because from my perspective the grocery delivery business is more sustainable than the meal kit one. It’s cheaper, but also gives us our need-it-now/delivered fix. And that’s where Amazon’s entry into the market becomes very frightening, because they can deliver at such lower margins than so many other competitors on the market. I would bet on the grocery delivery industry being more profitable in the long-run than the meal kit.

  6. andrewmanginelli · ·

    $9.99 seems super pricey for a meal that you have to prep yourself. I don’t think this is going to be sustainable enough to catch on (possibly seen in the plunge of Blue Appron’s stock since its IPO). What I could see happening is the rise of a grocery delivery service, such as Amazon Fresh. If they can provide these groceries at grocery store prices (plus the delivery convenience fee), I think this is something that could definitely catch on. I just really could never see myself, or many others, paying $10 and having to prep/clean, and the market for this is definitely small (I doubt the average American has anywhere near enough money to pay $10 for a meal).

  7. We’re big fans of blue apron, but it’s an add-on to grocery stores, not a replacement. If grocery stores are smart, they’ll develop a competing service and likely be able to compete due to a better distribution footprint. They’d better move fast though.

  8. ojeagle121 · ·

    I’ve tried Blue Apron, it was ok. As someone who likes to cook, I often enjoy my grocery shopping trips … all that food looks so delicious! I remember reading an article about two economists who would outsource their meals during the week to a prepared meal deliver service. The idea, of course since they’re economists, is of opportunity cost. They would rather pay extra to have meals delivered b/c they placed a higher value on family time than money/meal prep. An extreme example but if not going grocery shopping gives you more time to enjoy another activity, meal delivery services is a great way to achieve that.

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