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Capturing Share of Mouth in the Subscription Food Service Marketplace

Mon, 09/05/2016

By Brianne Killinger , Vice President, MSLGROUP

Americans are increasingly wary of the nutrition of processed foods. However, many are too time-starved to whip up a homemade meal. Enter the subscription foodservice as a solution, offering nutritious and delicious foods in customizable options, delivered automatically to your doorstep.

Companies including Blue Apron , Hello Fresh and Plated have introduced a model offering total convenience—weekly shipments of foods pre-measured in a handy mis en place fashion, ready for some quick searing and enjoyment. They’re also offering the experience of something new whether it’s ingredients like yuzu juice and garam masala or previously untried cooking techniques like braising. And there are options abound with preferences for couples or families, vegetarian or gluten-free and even wine pairings.

Food Subscription 01 Technomic , a food-industry consulting firm, predicts that worldwide revenues from fresh food subscriptions will top $10 billion by 2020. However, numerous brands are competing for a piece of the home food budget and it’s unknown how large the addressable market is for these types of services. Furthermore, retention can be a big issue as consumer fatigue sets in quickly if a brand missteps with poor shipping or food quality. Even a few weeks of churning out menu items perceived as “boring” can lead to cancellations.

So how can a food brand with the subscription model stand out?

Establish and maintain trust

While on-demand food delivery services like Amazon PrimeNow and Instacart also capture share among busy consumers, people look to subscription food services to curate ready-made food experiences. Clearly indicate via communication channels and your packaging what customers can expect and deliver that at all times. Make a mistake? Communicate it early and provide a way for customers to give feedback.

What’s cooking?

Vegetarian and vegan food delivery service Vegin’ Out provides pre-made meals that customers can customize as per their tastes.

Find your value proposition and dig in

Food Subscription 02 While variety is the spice of life, consumers can be resistant to change. If your brand made a name for itself by bringing paleo food to the masses, don’t ease up. Stay up on trends to keep the freshness alive but don’t stray too far away from your mission statement. If your customer has low confidence that you’re the expert on whatever niche offering you provide, they’ll look to another alternative that speaks to them.

Listen and adjust to your audience

A passionate and vocal fan base is your best resource when competing with multi-million dollar CPG companies with years of research and testing at their fingertips. Listen to your customers often through social media and brand research studies to learn what tweaks you can make to stay relevant. The Millennial is said to be one of the largest audiences for food subscription services. However, as millennials age and some become parents, dinner for two is no longer enough. Brands like Blue Apron are adjusting by offering family plans with larger portions and ingredients friendly to a child’s palate. Similarly, with snacking on the rise, NatureBox changed its business model from monthly shipments to customizable size and delivery options.

As more Americans look to seamless and convenient options for food, subscription models will no doubt continue to gain momentum. With these tools, brands looking to leverage this business model can get ahead and stay there.

This article is a part of MSLGROUP’s report The Future of Food Communications: Winning Share of Mouth in the Conversation Age .

Brianne Killinger Brianne has worked across various industries including consumer packaged goods, food and beverage, retail, consumer technology, and corporate social responsibility. She has led consumer and corporate campaigns, social media strategy and implementation, spearheaded integrated marketing and developed narratives for new initiatives. Connect with her on Twitter @beege .

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