Perhaps one of the most innovative businesses we have seen develop over the past few years is the meal-kit delivery industry. This convenient service makes it a lot easier to cook and enjoy home-made meals. Meal Kit services are extremely customizable, offering many options for personalization. The experience centers around the customer, and what you can get is only limited by your imagination.
The food business is attempting to return to the full-service method, which focuses on the needs of the customer, that was once traditional long ago. This approach fell by the wayside when self-service grocery stores came on the scene before WWI. A few decades later, self-service stores developed into warehouse clubs and supermarkets that offered low prices, a variety of foods, and a DIY convenience.
There are several reasons why the food industry is suddenly looking to become more convenient. More consumers are frazzled from work. People are working longer shifts, and more women are going to work rather than staying home. Finally, it’s gotten to the point where long trips to the supermarket just are not practical.
Meal kit services are a representation of both technology’s part in the lifestyles of working consumers, along with the food business’s reply to the consumers’ request for more convenience. Top meal kit services all advertise tempting images of their dishes on social media and websites and deliver complete kits right to the consumer’s door.
Within the meal kit industry, several trends have developed. Following is a list of the top ten.
In terms of waste, meal kits are much friendlier to the environment than grocery stores. True, packaging materials, such as plastic, are used for meal kits, but the packaging is not a large factor in the environmental impacts from meals. In terms of carbon footprints, the emissions from processing and distribution, farm equipment, and fertilizer production are larger than from packaging used to maintain the freshness of food. That said, many consumers are still seeking more packaging improvements such as fewer plastics used, more compostable packaging, and insulation made from recycled materials. In 2021, the meal kit industry is likely to make changes concerning the sustainability of its services, especially in packaging and changing consumer perceptions.
A key reason why many people opt for meal kits is to make following a diet easier. This has not gone unnoticed by the meal kit industry. In fact, in 2019, Blue Apron engaged in a limited partnership with Weight Watchers. Other kit services are concentrating on particular diets. For instance, some meal kit services offer keto, paleo, or vegetarian meal plans. Over the course of the next year, we can bank on more meal kit services specializing in niche diets.
In accordance with current health trends as well as concern for the environment, many consumers are interested in consuming only organic foods. The meal-kit industry is aware of this. Although the standards of organic farming differ from one region to the next, organic ingredients often share a few characteristics. These include ecosystem preservation, consideration for water supply, and biodiversity. When shopping in grocery stores, organic ingredients are sometimes hard to find. However, meal kit services eliminate this difficulty.
Catering to Lifestyle Choices
Appealing and catering to individual lifestyle choices is another growing trend within the meal kit industry. For instance, the vegan lifestyle requires an individual to avoid not only meat but any food that is animal-based. As a result, special ingredients are often needed to prepare basic meals. Meal kits make it easy to maintain a vegan lifestyle while offering a wide variety of choices. Other lifestyles, such as those that require fast or easy cooking, but do not require special foods, or avoiding certain foods, are also met through meal kits.
A primary selling point of meal kit services is the time they save you. Instead of having to decide what to eat, get a recipe, go to the grocery store, and all of that, you just order your meals and everything is delivered to you. However, most meal kit services provide dinner only. You still have to shop for breakfast and lunch. This dampens the time-saving theory. That is why, in 2017 Hungryroot shut down its popular business and re-opened with the option to have every meal, including snacks, taken care of. It is likely that other meal services will follow Hungryroot’s example.
Thanks to refined logistics and automation processes slashing operation costs, consumer pricing within the meal kit service is more competitive. Although the price of meal kit services has been reasonably high in the past, a few services, like EveryPlate and Dinnerly, have found ways to cut costs, allowing them to provide more affordable pricing. As many meal kit services struggle to obtain and keep customers, in part due to the high cost, we can expect more meal kits to look for ways to lower costs in order to appeal to more consumers.
Pre-Made Meal Choices
Another key selling point for this industry is convenience. When this industry began, meal kits just sent ingredients and a recipe for you to follow and you cooked everything yourself. Although handy, this still required a time commitment and required prepping, cooking, and cleanup. Recently, pre-made meal kits have become popular. These come pre-cooked and require no preparation or cleanup. We can bet that the next stage of meal kits will completely do away with the prep and cook steps.
Large Companies Buying Smaller Ones
It has been a growing trend within recent years for big companies to buy out small ones. For instance, Chef’s plate was bought out by Hello Fresh and GoReadyMade was bought out by Freshly. By purchasing the smaller companies, the larger meal kit services are expanding their operations while simultaneously decreasing the competition. As meal kit services continue to develop and need to be profitable, it is probable that the acquisitions and mergers will increase .
Extended Delivery Services
The convenience of delivery is another reason some people use this service. In light of this, many meal kits are beginning to offer extended delivery services. Some meal kits offer multiple delivery times throughout the day, which makes them good options for breakfast, lunch, or dinner.
In the beginning, meal kit services were backed by huge investments. However, lately, some of these companies are trending towards outside investments, especially those specializing in a particular niche. Plant-based Purple carrot, for instance, raised $12.8 million through funding and Sun Basket raised $125 million from outside funding.
Advantages of Meal Kits
Of course, you can easily visit the supermarket and purchase the ingredients necessary for a homecooked meal. Therefore, you might be pondering why anyone would choose to subscribe to a meal kit service. Basically, there are several advantages to using a meal kit service. For instance, you receive delicious, diverse, and interesting dinners. There is a decreased chance of leftover ingredients that end up going to waste. Rare, or hard-to-find ingredients are more accessible. Meal kit services make healthy eating more convenient. Finally, for some people, the hassle of going to the grocery store and physically shopping for the right ingredients is just too inconvenient.
Furthermore, the meal-kit industry is re-inventing what meals look like for busy consumers who do not have much time to go grocery shopping or cook.
Meal Kit Industry Stats and Growth Projections in 2021
- The meal-kit business is worth approximately $5 billion.
- Additionally, 17% of consumers in America have subscribed to a meal kit service at some point.
- Of the Americans who have subscribed to meal kit services, 90% referred other people to the service (Packaged Facts).
- 25% of people living in cities have tried meal kit services, compared to just 14% of people in rural areas.
- 26% of the Generation X population has tried meal kit services.
- Out of the millennial population, 29% have tried meal kit services.
- In regards to people age 45 and up, merely 12% have tried meal kit services.
- 23% of men and only 15% of women have tried meal kit services (Money).
- Meal kits delivered to the home are believed to be healthier than restaurant food by 81% of US citizens (USA Today).
- The meal kit delivery industry is estimated to be worth $11.6 billion by 2022 (Statista).
When it comes to revenue, the US grocery business still largely outranks the meal kit delivery industry. However, meal kit services are a powerful force within the food industry. Meal kit services are a strong example of the campaign toward offering more convenience to the consumer for eating fresh, healthy foods. Additionally, the meal kit delivery business fits in the definition of electronic ordering of groceries for delivery from traditional stores.
Meal kit services tackle the on-going demand for convenience. Both foodservice operators and retail grocers bare the responsibility of delivering food to consumers and the dinner tables. Foodservice operators, convenience stores, and retail grocers, along with other food marketers, are making strides to provide meal delivery services of their own. Busy parents and working consumers who do not have a lot of spare time are usually the ones seeking out time-saving trends within the food industry. In addition, young consumers who are not well educated in the art of preparing and cooking meals are also more inclined to subscribe to meal kit services.