As consumers continue to become more time poor, they are looking for more convenient options to make tasks easier. An example of this is the rise of subscription-based meal kits which continue to grow in popularity. “The grocery sector has always been driven by changing trends, societal norms, consumer tastes and the evolution of technology, and it will no doubt continue to be. As a retailer, our role is to look at what’s valuable for our customers here, and at the moment, convenience is a huge driver – whether that’s online shopping, meal inspiration or otherwise,” said a spokesperson for Countdown.
While the grocery industry once feared the rise of the meal kit, some supermarkets have adapted to use it to their advantage. Some retailers have partnered with meal kit brands to offer options instore to consumers. The most recent partnership saw American supermarket chain Kroger acquire meal kit delivery business, Home Chef for $700 million. The partnership will see Home Chef continue to run its online delivery service as well as stock its meal kits in Kroger’s physical stores. Amazon Go has a large selection of meal kits in its store while earlier this year online meal kit company Chef’d opted to stop its online service and is now sold in supermarkets. Josh Hix, Co-founder and CEO of Plated wanted to achieve what he called Meal Kits 2.0 and so sought out a retailer to partner with. Albertsons came to the table, and now together Plated is creating convenient meal kits for customers that they can pick up in store.
Supermarkets here are looking at meal kit subscription systems as an opportunity with subscription-based online shopping set to become one of the next breakout innovations in the industry. Nielsen is already tracking the rise of subscription-based online shopping with 60 percent of those aged 21 to 34 willing to use some type of online automatic subscription service while 17 percent of millennials are already using it. Consumers select an option that allows essential everyday items such as toilet paper and laundry powder to be automatically refilled and delivered to their home every week. New Zealand artisan cereal producer, Yum Granola has a breakfast club which allows users to sign up to either fortnightly or monthly cereal subscriptions.
So why don’t supermarkets adopt this model as well? Countdown believes that while subscription-based shopping is increasing in popularity, traditional online shopping still has the highest demand. “Online shopping is still absolutely the biggest convenience that our customers demand. It’s a seamless service with the freedom and flexibility to order and deliver where and when it suits them or pick up quickly on the go.”
It makes sense to have an automatic subscription service for shelf stable products that consumers need available online. Statistics show that 60 percent of online purchases are non-food related items such as toilet paper, dishwashing liquid, toothpaste and petfood. Allowing customers to set up automatic replenishments at a weekly or monthly cycle would result in guaranteed sales for retailers and added convenience for the customer.