Specialist
Former Global Head at Marley Spoon AG
Agenda
- Coronavirus impact on demand dynamics and growth sustainability
- Customer acquisition and retention strategies
- Competitive landscape and market share dynamics
- Box economics and margin expansion opportunities
Questions
1.
Could you share an overview of the European meal kit market pre-coronavirus? Who are the key competitors, what is the approximate market size and what was driving growth?
2.
You noted the market was still in its infancy pre-coronavirus. How has the pandemic and subsequent lockdowns changed the market and reshaped consumer trends? Online retail has grown, including a substantial amount of growth in the meal kit market.
3.
How much do you think the European market has grown through the pandemic? Some analysis suggests it has almost doubled.
4.
What would you estimate is the penetration of meal kits in Europe or other key markets? Where could it reach in five years’ time, and what could hinder that growth potential?
5.
Do you think players who scale their businesses will have higher growth and profitability, or do you think the players who fix the product and push out a better offering will have more success?
6.
Do you expect the high growth rates to slow down through 2021 as we emerge from the pandemic?
7.
How were customer retention rates trending YoY pre-coronavirus for HelloFresh, Marley Spoon and other key players? It was an issue a few years ago, and still is an issue for some players, but were they improving their retention strategies pre-coronavirus?
8.
What key retention strategies have developed in the market, and which would you say are best-in-class?
9.
You mentioned price as a key factor. What is the price difference between the key competitors, if any?
10.
Could you outline the various customer acquisition channels and how you expect them to evolve? What is the typical customer acquisition lifespan?
11.
HelloFresh has been criticised historically for the aggressive discounts it offered to sign up customers. Do you think this would have changed significantly due to coronavirus-driven demand, and do you expect the industry to ever return to the pre-coronavirus levels of discounting?
12.
You noted the importance of targeting the right customer – what would you say is the biggest customer pool for meal kits, and who would likely become a long-term sustainable customer?
13.
Would you agree with the hypothesis that customers being forced to rely more on online grocery retail lends itself to a bigger pool of targets for meal box kits as well?
14.
Do you expect the high demand environment will lead to more niche competitors entering the market, or do you expect any market consolidation?
15.
Do you think there are any competitive threats from the large grocery retail chains or Amazon potentially entering the meal kit market?
16.
HelloFresh’s marketing costs have reduced to around 12%, driven by the demand. What do you think is a sustainable marketing cost percentage for HelloFresh or its peers as competition intensifies? Do you expect they will have to spend more on marketing to maintain customers and to grow organically?
17.
Do Marley Spoon and HelloFresh have any significantly different approaches or cultures? Is there anything preventing Marley Spoon from reaching the scale of HelloFresh over the next 5-10 years?
18.
Are there any risks that could derail either Marley Spoon or HelloFresh’s growth plans over the next 5-10 years?
19.
How would you assess the cost side for these businesses? A lot of investment is needed for the technology and R&D. Do you expect any notable cost inflation to manifest, either on the raw material side or through a margin impact as costs increase through innovation?
20.
What really drives the margin differences between the key players? Is it mostly the technology and the scale?
21.
Do you expect any pricing increases per box from any European players over the next 12 months?
22.
Are there any markets within Europe with high growth potential that you think would be the optimal opportunities for further development of the meal kit market?
23.
Do you think a potential recessionary environment represents any risk to the meal kit industry, given that consumer wallets might be under pressure, or do you think this industry is fairly insulated due to the nature of its consumer targets?
24.
How might the meal kit market develop in the medium term? Do you expect the key players to continue their current business models, or would you expect more innovative boxes?
25.
HelloFresh in the US has segmented itself into three brands – HelloFresh, EveryPlate and Green Chef – to target different customers at different price levels. Could Marley Spoon, HelloFresh or another player take the same offshoot-brand approach in Europe?
26.
Do you think HelloFresh might want to acquire Marley Spoon or another player?
27.
Do you have any final remarks on the outlook of the meal kit industry?
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