By Erik Thoresen, Principal, on September 26, 2017
What does Albertsons’ $200 million deal to acquire Plated (DineInFresh, Inc.) mean for the food business? First, while many analysts point to the acquisition as a signal that the meal kit market is maturing, it is not entirely unexpected. In fact, it’s fair to expect that the rate of future acquisitions of players in the meal kit space could accelerate, particularly as retailers intensify their focus on expanding online offerings in wake of the Amazon acquisition of Whole Foods.
As an industry, we’ve discussed that the traditional definitions of “online” and “brick-and-mortar” continue to change. It is important to keep in mind that food is a dynamic business and the emergence of the meal kit market in the U.S. over the last five years helped to demonstrate that consumers are willing to adopt new approaches to sourcing food. Like many of the emerging direct-to-consumer platforms, the meal kit business model has changed and been fine-tuned over the last several years. The Albertsons deal will likely bring about a more significant shift in terms of where meal kits are sourced (in-store versus online). It also further contributes to the growing omnichannel movement when it comes to food sourcing.
But at its core, the value proposition of meal kits involves a box of premeasured ingredients, customized for buyers, that are typically designed to drive discovery of new recipes and new methods for preparing food at home. The Albertsons-Plated deal will impact the balance in terms of whether these kits are delivered to consumers’ doorsteps or whether an in-store strategy also makes sense. Furthermore, it may also trigger discussions about future acquisitions within the meal kit sector—the futures of Blue Apron and others in the meal kit space are already talking points in the media this week.
Erik Thoresen, Principal
Erik draws from his over 15 years of experience in market analysis, product development, and forecast modeling throughout the food and hospitality industries. Erik is a subject matter expert in the areas of technologies and futuristic developments impacting the food industry. Read more »
Technomic Inc., a Winsight company, delivers a 360-degree view of the food industry. It impacts growth and profitability for clients by providing consumer-grounded vision and channel-relevant strategic insights. Its services range from major research studies and management consulting solutions to online databases and simple fact-finding assignments. Its clients include food manufacturers and distributors, restaurants and retailers, other foodservice organizations, and various institutions aligned with the food industry. Visit Technomic at technomic.com.
About Winsight, LLC
Winsight LLC is a recognized leader in business-to-business media and information services for the convenience-retailing, foodservice and grocery industries. Winsight has an extensive media portfolio, including five publications: CSP, Restaurant Business, FoodService Director, Convenience Store Products, and Winsight Grocery Business. Winsight also offers a suite of digital products, including websites, e-newsletters, webinars, video products, mobile and tablet apps, and custom marketing solutions. In addition to more than 12 major EduNetworking conferences and advisory meetings, Winsight also produces seven exclusive, large-scale executive-level conferences: Restaurant Leadership Conference, Global Restaurant Leadership Conference, Outlook Leadership Conference, Convenience Retailing University, FSTEC, MenuDirections and Restaurant Directions. In 2015, Winsight acquired Technomic Inc., a provider of primary and secondary market information and advisory services for the food industry. For more information on Winsight and its brands, go to www.winsightmedia.com.