LAS VEGAS — Retailers big and small face increasing competition from online retailers and meal kit delivery.
One independent chain showed how it's taking on that competition at the National Grocers Association annual conference in Las Vegas Feb. 12-15.
Emily Coborn, vice president of fresh merchandising for Coborn's Inc., a 30-store chain based in Minnesota, says the company started cobornsdelivers.com for consumers to order groceries for pickup or delivery, and there's a meal kit option.
“Customers can order all their groceries at the same time as a meal kit,” she says at a Feb. 14 workshop.
She says Coborn's sells about 100 meal kits a week, primarily to its existing customer base, but those are people who would use competitors like Blue Apron if the grocery chain didn't offer it.
Coborn says meal kits are designed by nutritionists and chefs to appeal to consumers in Minnesota.
“They're for people who are time-starved, but they can't be too edgy,” she says. “They're mostly feeding families.”
She said Coborns uses the meal kits to introduce consumers to new items in the store, and they usually notice an uptick in store sales for items that are in meal kits.
Just how big is the online grocery market?
It's about a $60 billion industry, says Erik Thorsen, a principal at Technomic Inc. And he says the meal kit industry is projected to take about $3.3 billion from retail and $2.2 billion from foodservice by 2020.
“Meal kits are a huge time savings but also a huge brain savings,” he says, meaning consumers don't have to deal with menu planning and finding ingredients.
He says that retailers who want to expand in online grocery and meal kits have to make it as simple to use as possible.
“If you look at Uber, it's a very good interface,” Thorsen says. “They're easy to use, but not just for customers but also for employees.”