Dive Brief:
- California-based Raley’s became the latest grocery to enter the competitive meal kit business with subscription-free selections. The options serve two to four people and range in price from $3.99 to $19.99.
- The kits align with Raley’s ongoing efforts to provide customers with healthy options, but take it to the next level by allowing shoppers four ways to personalize their kit that includes complete meals and easy-to-make sides. The kits can be ordered in-store or online, picked up or delivered, giving customers additional flexibility and choice.
- The new meal kits were designed internally by Raley’s. “We want to be the destination for our customers looking for a healthy, home cooked meal,” said Evelyn Miliate, Raley’s culinary innovation manager. “The kits include high-quality ingredients and offer great variety so your family doesn’t get bored with the same recipes.”
Dive Insight:
Raley’s has been transforming its customer experience during the last few years with an increased focus on healthy choices and providing customers with more personalized purchasing options.
The recipes are seasonally inspired and will rotate quarterly, according to the company. The meal kits come with all the items necessary to make a full meal — quick kits come with pre-cut vegetables and cooked chicken; sides pair with a grab-and-go rotisserie chicken for speedy meal prep; and creative kits include combinations of sauces, starches and vegetables. New refrigerators have been installed at the front of the store to make it easier to grab the kits and go. More choices, personalized options and convenience caters to the needs of today’s shopper.
Raley’s isn’t the first grocer to market a meal kit but it is one of a few to create its own line. Florida-based Publix and New Seasons Market have introduced their own options. Kroger, which purchased Home Chef kits earlier this year, recently expanded its Easy For You! customizable meals line that customers can prepare in the store. Albertsons purchased Plated for an undisclosed amount last year, and Blue Apron is being sold by Walmart’s Jet.com and Costco. Hello Fresh began selling its kits at Giant and Stop & Shop stores in the Northeast earlier this year.
The meal kit business is booming. According to Statista, 27% of internet users purchased restaurant and meal kits online in 2016. Revenue is expected to grow to more than $10 billion dollars in 2020, from $1 billion in 2015. In-store meal kits aren’t as popular as home delivery, but they are showing growth while brick and mortar sales stay relatively steady. Nielsen data said in-store meal kits in 2017 generated $154.6 million in sales, posting growth of more than 26%, while sales for center store products dipped 0.1% to $374 billion.
Americans are eating an increasing number of their meals, roughly 80% of them, at home, according to the NDP Group. This makes the grocery aisle the ideal place to find meal inspiration, easy to prepare recipes and healthier options. The offering of easy meals by Raley's — especially the smaller component kits — also is a way to encourage shoppers to cook more, which in turn could help draw them more often to the grocery store.
Raley's has made health a core part of their business. Last week, Raley’s launched a nutrition education video series featuring owner and chairman Michael Teel, and in recent months the company opened its first wellness-focused Market 5-ONE-5. It also hired a full-time dietitian. These moves align with the grocer’s goal of giving shoppers more access to healthy choices and boosting transparency about food products. The meal kits are another asset in its portfolio to enhance the customer experience — both online and in-store — a necessity for supermarket chains today, especially the smaller players.
