Can Costco save Blue Apron?
Blue Apron is still working to turn its business around, and it's hoping Costco can help.
Blue Apron said during its first quarter earnings report that it has started selling meal kits at Costco. The company is hoping that a multi-channel strategy with retailers can help it grab more customers. The meal kit provider has been losing customers for several quarters but reported Thursday that it had seen a 5% increase in customers during the first quarter ended March 31.
Net revenue increased 5% sequentially from the fourth quarter of 2017 as Blue Apron reaccelerated its marketing efforts.
“We are pleased with the progress we achieved this quarter, including significant improvement in operational efficiencies as reflected by our margin performance, which was the strongest we have seen since the second quarter of 2016,” said Brad Dickerson, Chief Executive Officer, Blue Apron Holdings Inc. “We also improved our customer metrics as we began to methodically reaccelerate marketing late last year, with a specific focus on attracting new customers with high affinity as well as deepening our engagement with current customers.”
Blue Apron said average revenue per customer was $250 in the first quarter of 2018 compared to $236 in the first quarter of 2017, and $248 in the fourth quarter of 2017.
“We look forward to building on this momentum as we continue to optimize our direct-to-consumer business, create new products that complement our core offering, and leverage new distribution channels––including our newly launched pilot program with Costco––to expand the reach of our strong brand to more households across the country,” Dickerson said.
Net revenue at Blue Apron increased 5% quarter-over-quarter reflecting the company's methodical reacceleration of its marketing efforts and advanced product merchandising capabilities in the first quarter of 2018.
Net revenue decreased 20% year-over-year to $196.7 million in the first quarter of 2018 compared to the first quarter of 2017, driven primarily by a decrease in Customers and Orders following the deliberate pullback in marketing spend in the second half of 2017, as Blue Apron builds toward momentum in the business in 2018.
Blue Apron said earlier this year it will make its kits available in supermarkets by year end.