Specialist
Former VP at HelloFresh SE
Agenda
- Top-line growth drivers for HelloFresh (ETR: HFG) and customer acquisition strategies
- Customer stickiness and HelloFresh's brand proposition
- Competitive landscape, evaluating threat from Amazon (NASDAQ: AMZN), and dynamics among HelloFresh’s brands
- Customer retention strategies and margin expansion opportunities – cost inflation and HelloFresh’s ability to pass this through to customers
Questions
1.
Could you highlight 2-3 key trends impacting the meal kit market globally and in the US, particularly HelloFresh, over an extraordinary 18-24 months?
2.
You touched on the change in meal kit perception and how that helped expand HelloFresh and the meal kit market TAM. How sticky do you think these perception changes and this TAM growth are as we exit the pandemic? Is this a structural change for the industry?
3.
Obviously there were a large pool of new meal kit customers through the pandemic. Are there any noticeable differences between traditional HelloFresh customer profiles and those of customers acquired during coronavirus?
4.
You mentioned how you consider segmentation around marketing and brand. How should we assess brand power post-pandemic, especially HelloFresh’s, considering a company such as HelloFresh that’s still on an exponential growth curve?
5.
You mentioned the different customer profile and segments entering the market during coronavirus. Is there any difference in how we should assess pandemic-acquired customer retention vs retention tactics and retention of traditional customers?
6.
What do you think drives HelloFresh’s customer retention? Does any factor drive better retention within customers that become sticky?
7.
How could HelloFresh’s retention rates trend?
8.
HelloFresh’s management expects average order rate to remain constant at around 4x. Do you think anything structural to the company sets this average order rate here and nothing lends itself to increase rates?
9.
Do you think there’s any way HelloFresh can pivot into grocery store behaviour and drive AOV?
10.
Another factor of AOV is price per box. What is HelloFresh’s ability to increase prices, especially given the cycle of rising cost and food inflation?
11.
Is it fair to think any increase in price will have a detrimental effect on volumes and customers?
12.
How much changing between brands would you note among customers? If HelloFresh’s price increases, would you expect some downtrading to EveryPlate’s offering or a cheaper meal kits offering, or could customers exit the industry fully?
13.
What do you think the risks and rewards are if HelloFresh brings all its brands under one platform? Obviously the risk could be further cannibalisation, and that saggy mattress effect, but you might add an extra layer of variety, which leads to retention. Would this ever be a viable strategy for the company?
14.
Do any of HelloFresh’s three key brands drive margin for the company, or does the higher price ultimately relate to higher margins despite slightly different sourcing tactics or ingredients?
15.
What’s your growth outlook across HelloFresh, Green Chef and EveryPlate?
16.
How does Factor fit into HelloFresh’s model? It obviously brings a new dynamic. What’s your outlook for it?
17.
How successful could HelloFresh be in moving towards lunch and breakfast offerings? It seems to be slowly starting to penetrate lunch with Factor, and increasing its penetration within the TAM by increasing offerings has always been a key message.
18.
HelloFresh’s 2021 capital markets day presentation showed that revenues followed the TAM expansion more than the increase in penetration. Obviously, the company is running out of TAM expansion opportunities, so does it need to focus on targeting breakfast and children’s meals to continue on that growth curve? Or is now the time to switch to TAM penetration with its current offerings? What do you think is its logical and most likely strategy?
19.
You mentioned discounting’s still a major factor, and there has been a slight decline in acquisition costs, but that goes back to the pandemic bounce in demand. What is your acquisition costs outlook, and is this lower level sustainable long term?
20.
You mentioned Facebook as a key acquisitions channel. Does HelloFresh rely on any other channels for customer acquisitions, and are there any risks to those?
21.
Have HelloFresh’s marketing costs reached a mature, sustainable level, or do you expect them to increase or decrease post-pandemic?
22.
Would you highlight any competitive threats to HelloFresh from any incumbents?
23.
Would you note any external competitors or competitors yet to enter the market? Amazon could enter this market, given its infrastructure and logistic capabilities and grocery capabilities with Amazon Fresh.
24.
Are there any follow-ups or points we haven’t discussed around HelloFresh, its strategy and outlook?
Gain access to Premium Content
Submit your details to access up to 5 Forum Transcripts or to request a complimentary one week trial.
The information, material and content contained in this transcript (“Content”) is for information purposes only and does not constitute advice of any type or a trade recommendation and should not form the basis of any investment decision.This transcript has been edited by Third Bridge for ease of reading. Third Bridge Group Limited and its affiliates (together “Third Bridge”) make no representation and accept no liability for the Contentor for any errors, omissions or inaccuracies in respect of it. The views of the specialist expressed in the Content are those of the specialist and they are not endorsed by, nor do they represent the opinion of, Third Bridge. Third Bridge reserves all copyright, intellectual and other property rights in the Content. Any modification, reformatting, copying, displaying, distributing, transmitting, publishing, licensing, creating derivative works from, transferring or selling any Content is strictly prohibited
