Subscription food steps up to the plate
Have you noticed how and where you buy food? Have you noticed your shopping-style gradually changing? Things are changing in the way that we shop. This includes food. Turquoise takes a peek at the rising preference of consumers paying a subscription for food services like Hello Fresh and Gousto, following in the footsteps of entertainment subscription services such as Netflix and Spotify.
There are now around 1.7 million people in Britain choosing subscription-based grocery shopping services over a usual weekly shop, and nearly 600,000 UK consumers purchasing repeat recipe kit subscriptions instead of ingredients from a supermarket.
Consumers today desire personalised products and experiences. The convenient, flexible and immediate access to these personalised services is something we only get through ongoing, mutually beneficial relationships with brands. This trend has led to the rise of new generation businesses catering to this desire by offering repeat subscription services.
After convenience food took off, the advent of subscription food boxes took ‘convenience’ to a new level. Recipe and snack boxes are now instantly available to singles, families and those with busy lives, desperate to avoid the arduous meal planning and shopping that awaited them each week.
“From start-ups to long-standing brands, home-delivery platforms are burgeoning with improvements. These are set to re-invigorate our shopping experience.”
What exactly is happening?
Subscription experts Zuora recently revealed that 58 million British consumers are now subscribing to one or more products or services, 11% up from last year.
Their subscription study found:
- The Subscription Economy has changed all shopping habits, from food to healthcare.
- British consumers now spend 12% of their monthly income on subscriptions.
- Subscriptions are equal among older age consumers as they are with Millennials.
The average UK adult now spends roughly £56 a month on subscription services, with 35– 54 yr-olds spending the most, at £62 per month.
What are your options?
With companies such as Hello Fresh, Gousto and Graze offering healthy meal opportunities, consumers can get on with their busy lives free of shopping and meal planning. The issue of disposable packaging is also addressed: 95% of Gousto packaging is recyclable; and Graze offer a similar theme, with their snack packs being made from PET number 1 plastic, also recyclable.
Is this happening elsewhere?
Yes. Global consumer expectations are changing considerably with regards to shopping for food and drink. In the last few months, Amazon announced that they would be taking over Whole Foods Market, blurring the boundaries even more between food and beverage purchase channels.
What is the impact on the grocery industry and for food & drink as a whole?
One ramification is evident: businesses will need to prioritise the consumer experience for it to be as convenient as possible. Companies will need to offer product variety, easy cross-channel connections and complementary products and services. Pricing strategies, together with personalised ways to be able to manage the process will also be key.
To stay ahead of the game, retailers will need to seek out further opportunities that satisfy these evolving consumer preferences. Our in-house market research indicates that now consumers are cognisant of the benefits offered by subscription services in the entertainment, music and food industries, significant proportions would be interested in similar models for a host of other services.
Successful companies will need to understand how they become subscriber and customer-centric in this developing marketplace. Company employees need to be equipped with the right tools and skill sets.
Can you positively answer the following questions of your business?
- Is your business focussed around customers rather than products?
- Do you understand how, when and where customers want to use your services?
- Do you create a compelling experience for your customers?
If you require help or advice regarding any area of market research or consumer insights then we would be delighted to hear from you. With 30 years experience in food, retail, healthcare, consumer, and B2B market research, Turquoise is ideally suited to partner with you on your next project. To find out more about our approach and our services please click here http://thinkturquoise.com/what-we-do/