Home Blog 2018 Meal Kit Subscription Services Aren’t Doomed
Oct 29, 2018

Are Subscription Meal Kits Doomed?

Subscribe to our blog

It’s no secret the subscription-based fresh meal delivery kits are facing struggles. Retention rates are low, many find them too expensive, and these companies are working overtime just to bring in new customers with deals and incentives. Now the latest wrench being thrown in the mix are non-subscription kits consumers find in grocery stores adding to the competitive pressures. Is the subscription-based model doomed?

I say not so fast. Since these services started I often said the market is going to change from its original form and it’s doing just that. When we published our first report on meal kit delivery services in 2016, we found nearly two thirds of meal kit users would have made a meal from their pantry had they not used the kit. That speaks to their highly competitive nature with grocers, from which we predicted the tighter cooperation between meal kits and grocers we see today.

At the same time, the top motivation for trying these kits was the fact that all the ingredients were provided. In other words, these kits provided a solution to the consumer, saved them the trouble of determining what the dinner meal would be, and also provided everything needed for that meal. And by the way, it saved the consumer a trip to the store, which equals time back in their day.

But not everyone wants to be locked into a subscription, especially when the dinner meal decision is typically made at the last minute. By 4:30 pm on a typically day, most US consumers haven’t decided on their dinner meal yet. Retailers, looking to gain from this have started to introduce their own kits or sell existing meal kits in their stores. They not only capture the last-minute deciders but also showcase themselves as meal solutions providers as opposed to places that merely sell products. And meal kit users are taking notice. Our updated report on meal kits, What’s Next for Meal Kits?, says 59 percent of recent meal kit users are giving in-store kits a try.

I believe we’ll still see subscription-based meal kits in the coming years because they offer a convenience and solution a growing number of consumers seek. However, they will also need to be part of the growing in-store meal kit trend. Just like retailers are finding ways to be present both online and offline, meal kits need to be on the same journey.



Upcoming Event


The Future of Plant-based Foods: Key Takeaways for the Food Industry

Presenter: Darren Seifer, Executive Director, Industry Analyst - Food Consumption
Date and Time: Wednesday, January 27 at 2 PM ET
Location: Virtual
Description: With plant-based meat products stepping to the forefront in 2020, many food industry insiders expect plant-based foods to become an even larger part of our diet moving forward. This webinar will provide an overview of the current state of plant-based foods, and where they're headed in 2021.

Darren Seifer of NPD will offer expert insight on the subject, exploring the growing popularity of plant-based meat, dairy and grain products, along with rising demand for next generation plant-based alternatives.

Register Now

Stay current in your industry
SUBSCRIBE

Related Content

Tagged: Food Consumption , Foodservice


Over the Past Five Years, U.S. Consumers Added 25 Between-Meal Snacking Occasions Per Capita
Over the Past Five Years, U.S. Consumers Added 25 Between-Meal Snacking Occasions Per Capita

Over the past five years, Americans added 25 between-meal snacking occasions per capita, from 505 between-meal snacking occasions per capita in 2015 to 530 in 2020.

Restaurant Revival for Europe’s Big Six
Restaurant Revival for Europe’s Big Six

Despite widespread traffic declines in 2020, consumers in Europe’s biggest foodservice markets tell us there’s a lot they miss about out-of-home food consumption. Growth and recovery for your business depend on your understanding of how consumers’ behavior has changed and what they are likely to do when it comes to restaurant usage in 2021.

With Hope for Recovery in 2021, The U.S. Restaurant Industry Ends 2020 Making Its Way Out of the Steep Declines Caused by Pandemic
With Hope for Recovery in 2021, The U.S. Restaurant Industry Ends 2020 Making Its Way Out of the Steep Declines Caused by Pandemic

The U.S. restaurant industry closed one of the most unpopular years in history moving its way out of the steepest declines the industry has experienced since the Great Recession.

2021 Outlook for the U.S. Food and Beverage Industry
2021 Outlook for the U.S. Food and Beverage Industry

U.S. consumers’ eating attitudes and behaviors changed as a result of the COVID-19 pandemic. This 2021 outlook looks at how these behaviors may shift or remain the same in the new year.

Newsletter

Subscribe and get key market trends and insights relevant to your industry each month.

We will not sell your information. View privacy notice. | Cookie Settings