Evolution of Meal Kits

Evolution of Meal Kits 2

Foregoing the Subscription: Retailers embrace a fresh new alternative to home delivery meal kits.

By Benjamin Walker

In response to the success of meal kit home delivery services like Blue Apron and Amazon, more and more retail grocers are jumping into the prepared meal kit market. And there’s a good reason to do so. In 2017, grocers sold about $80 million in kits and as additional consumers discover the option’s growing availability, those sales numbers are expected to increase.

Of course, since the invention of the rotisserie chicken and grab-and-go sandwiches, food markets have always, to some extent, been in the prepared meal business. By way of contrast though, today’s new wave of meal kits are marketed to home chefs who like the speed and convenience of prepared ingredients, but still want that sense of satisfaction that comes with cooking the meal themselves.

In addition, for time-strapped millennials, grocery store kits provide welcome elements of control. A retail customer can see the freshness of the product, pick the kit that appeals to them that day and choose to personalize the meal with their own additional ingredients, if desired.

It’s definitely the millennials that have embraced the meal kit concept. According to Nielsen, one-in-four households tried a meal kit in 2017 but it is the millennial and generation X customers who are more likely to keep purchasing them by a whopping 321 percent over older generations.

Freedom of Choice

By offering meal kit options, grocers can give their customers liberation that their online counterparts haven’t: freedom from a subscription plan. Subscription plans are one of the chief roadblocks to online meal kit adoption. By offering one-off selections, retailers provide a distinction in the business model that appeals to its customers. It allows them to make the meal selection process spontaneous, picking up the kit they want that night, rather than being beholden to what the subscription service may or may not have left them that day.

Evolution of Meal Kits 1Retail grocers also have one up on mail delivery kit options when it comes to a carbon footprint as well. One of the chief reasons conscientious consumers have balked at the online services is the amount of packaging and environmental waste that is involved in getting the meal kit from farm to plate. Those bulky food containers and dry ice scream waste, leaving the home delivery option its environmental challenges. Perception among consumers who care about the environment is that kits available at a pre-existing retail markets have less added impact on the planet.

It is true that existing infrastructure plays a critical role in ensuring a retailer’s success with meal kits. Large grocers have access to an array of fresh ingredients directly from suppliers and distributors. Baldor Specialty Foods, for example, is already providing pre-cut veggies to grocers. The next logical step was to package these as chef-inspired, simple to prepare combinations and market them in what has become our Urban Roots line of Veggie Side Kits. When the right product resources and distribution networks are in place, the meal-kit concept can offer a genuine alternative to the home delivery model.

What’s on the horizon for retail meal kits? While the kits continue to see expansion at big chains like Kroger and Publix, which plan to launch them nationwide this year, the challenge seems to be with smaller convenience stores that can’t quite make the numbers work.

Recent studies reveal that these quick marts aren’t seen as dinner preparation destinations and that their customers, although looking for convenience, probably aren’t looking for meals that still require effort on their part to create. For larger retailers, experiments will begin in terms of offering larger, family-of-four-style kits.

Benjamin Walker is the senior director of marketing and development for Baldor Specialty Foods, one of the largest importers and distributors of fresh produce and specialty foods in the Northeast and Mid-Atlantic regions. Walker can be reached at BWalker@baldorfood.com.

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