Blue Apron launches on-demand delivery with Grubhub

Dive Brief:

Meal kit provider Blue Apron is launching on-demand delivery through Grubhub and Seamless to select zip codes in New York City, according to a news release. The delivery service will feature a rotating selection of Blue Apron’s kits, delivered in new custom packing and the option of two or four-serving meals that can be prepared in 30 minutes or less and cost between $19 and $38. Shipping costs $3.99 but the meal kit company is offering customers 40% off their first order.
Customers have a choice of stir-fried sweet chili chicken with broccoli and rice — a four-serving meal — or two-serving meals like spicy beef & gnocchi with zucchini and Moroccan-style couscous bowls with chickpeas, tomatoes, and feta. They can also purchase products from Blue Apron’s suppliers and partners, including Vermont Creamery cheeses, Irving Farm coffees, and Brodo broths.
“This new on-demand product is a complement to our core offering, giving consumers — for the first time — the option to have a Blue Apron meal delivered to their doorstep in less than an hour," said Brad Dickerson, CEO, Blue Apron. "We are thrilled to launch this initial pilot to expand the reach of our brand, and expect to build on this new competency with additional same day, on-demand platforms over the coming months.”

Dive Insight:

Still struggling to turn a profit, Blue Apron has tried its hand with many different partnerships hoping that one — or at least some combination therein — will crack the code of attracting and retaining customers. The company's test for on-demand delivery has been expected, as its CEO teased the idea last month.

With this latest partnership, Blue Apron is touting the benefit of customers getting kits delivered to their homes on-demand. Grubhub, along with other similar services, has lifted restaurant sales in recent years by offering speedy delivery and a wide selection. Blue Apron hopes it can bring in new customers by tapping into Grubhub's large user base, and also provide added convenience for meal kit users.

The question is, will consumers want on-demand delivery of a meal they then have to prepare? The company is focusing on meals that require 30 minutes or less, but even that may be too long for Grubhub customers used to digging in right after they get their order.

Earlier this year, Blue Apron partnered with Costco to sell its meal kits in stores. It has worked with celebrities like Chrissy Teigen, opened pop-up stores and released novel options like Bob’s Burgers themed meal kits.

These initiatives aim to spur brand awareness, but sustained growth will likely come only after Blue Apron addresses deeper issues. In recent months, the company has had to pull back on its marketing spending after a few operational mishaps. Since this cutback, its customer count has been declining over the course of the year. In its recent earnings report, Blue Apron reported a small decline in net sales along with a 24% drop in customers using the service. In May, it’s biggest competitor, HelloFresh pulled ahead as the meal kit market leader.

Blue Apron still has a chance to succeed, and the company hopes that by branching out into new partnerships and initiatives, it can do just that. The meal kit industry as a whole hasn’t been able to figure out the secret to keeping customers engaged while cutting down on high costs, most notably marketing. To keep its head afloat, Blue Apron will need to quickly figure out the right recipe to bring in new customers and keep its existing ones engaged.