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07/07/2021

Will Home Meal Subscriptions Continue to Soar Post-Pandemic?

Food delivery and subscription meal kits saw huge growth in 2020 as consumers flocked to online solutions for their groceries needs.
meal kit

Cooking and baking at home also became some of the most popular habits picked up during lockdown measures. As states reopen and more COVID-19 restrictions are eased around the world, the question remains: how will meal subscriptions fare post-pandemic?

For Gobble, a meal kit designed for busy professionals, with a 15-minute dinner prep time, the pandemic may have changed consumer behaviors so much that they become long-term subscribers.

Changing Habits

 

The pandemic disrupted virtually all aspects of life, including changing the way consumers shopped for food. From bigger basket sizes and fewer trips to the grocery store, as well as purchasing more grocery and everyday items for delivery, consumers found ways to get what they needed while reducing their exposure to the COVID-19 virus. And retailers reacted by shoring up their omnichannel solutions and technology. Coming out of the pandemic, grocery stores and other retailers are still focusing on growing these omnichannel networks, even as more consumers return to in-store shopping.

That’s because for a lot of shoppers, the convenience of online shopping is likely to stick. Not only will a significant portion of shoppers keep shopping online for groceries and everyday needs, but also for apparel and other items. The same is true for meal kit delivery and food subscription services, which saw a surge in new consumer enrollment during 2020. Subscription enrollment increased 41% across a number of industries when compared to a pre-COVID-19 January baseline, according to Ordergroove. Food and grocery enrollment rose 114% by the end of 2020.

Gobble saw its demand increase 4x, according to CEO and Founder Ooshma Garg. And a whopping 80% of Gobble’s members plan to stick with the company, according to a recent survey.

“In a recent survey in June of 2021, 80% of Gobble members say they will continue relying on Gobble meal prep and fast dinner kits post COVID,” Garg told Retail Leader. “You might think folks will go back to the grocery store, but 66% shared they plan to maintain their pandemic level of grocery shopping. Other solutions have come in.”

The larger subscription industry was growing before the pandemic, with a number of new competitors offering niche meal kits. Gobble’s fills the void for professionals who don’t necessarily have time to cook, but still want a healthy, tasty meal at home to avoid takeout every night. For many consumers, meal kits have taken over traditional grocery shopping--even during the pandemic when more people were making meals at home.

“On one hand, ⅔ [of our members], according to our member survey, cooked more than they ever had before in their lives [during the pandemic],” Garg said. “And 60% of people reported trying a new cooking trend during the pandemic. The most popular trend far and away was baking. And this is because cooking is cathartic, people were healing at home through cooking, providing for their families in a time when life felt uncertain. But at the same time, 50% of our members shared that they exclusively shopped for groceries online from services like Gobble that curate, personalize and deliver--ultimately doing groceries better than the big box stores.”

Meeting Demand

 

Like many other industries, meal delivery and subscription services faced supply chain challenges during the pandemic. As smaller businesses, many of these companies were tasked with innovating beyond how the supply chain typically operates in order to meet surging demand.

“The food and agricultural supply chain is very brittle and over optimized down to the penny to do one job very, very well,” Garg explained. “[Whether that’s] deliver these cuts of chicken or beef from this farmer to this butcher to that distributor to a specific grocery store. And when airlines weren’t flying and hotels were not open, food was being wasted in the supply chain. On our end, demand was skyrocketing, and we couldn't get access to the food because the subscription services, the startup food delivery companies were not naturally plugged into the old guard way of doing things.”

That meant to meet the demand, while dealing with other lockdown measures, Gobble had to work overtime. The company hasn’t stopped hiring since the start of the pandemic, according to Garg, who said her own family volunteered to help out while she also went into the warehouses to package food. Additionally, the company leveraged its variety of food offerings during supply chain constraints.

“In the traditional food industry, an assembly line and supply chain is designed to make one potato chip in the same bag, with the same recipe for 100 years,” Garg noted. “Gobble is making [15 to 18 recipes each week]. We’re serving tapas and then next week featuring Japanese ahi tuna. We now have 10 years of experience and expertise in a modular working environment with machines and assembly lines that can produce foods of any cuisine. We were ready for this kind of surge, and it tested our readiness. With the extra team and shifts and support, our infrastructure was in place to meet it.”

That variety actually played into changing consumer tastes during the pandemic, as well. With borders and restaurants closed, consumers were looking to bring in more flavors into their home meals.

“Consumers craved new flavors, which skyrocketed, and there was palpable excitement to try new flavors from around the world,” Garg said. “All of these dinner kits representing global cuisine were our best sellers throughout the pandemic.”

As many consumers return to a different kind of normal, with some returning to offices, it’s likely there will be some shifting once again when it comes to how shoppers buy their groceries. But in a fast-paced environment, subscription services are likely to continue seeing growing demand. In fact, UBS financial services expects the broader subscription economy to grow to $1.5 trillion by 2025, The Washington Post reported. More brands and grocers are also likely to add their own subscription services, if they haven’t already.