Specialist
Former Director at HelloFresh
Agenda
- HelloFresh’s (ETR: HFG) top-line growth drivers and customer acquisition strategies
- Customer stickiness and HelloFresh's brand proposition, discussing Factor75, Green Chef and EveryPlate offerings
- Box economics and margin expansion opportunities – cost price inflation and HelloFresh’s ability to push this through to customers
- Competitive landscape and market share dynamics, highlighting new players’ entry and potential for Amazon (NASDAQ: AMZN), Walmart (NYSE: WMT) and Target (NYSE: TGT) to join
Questions
1.
How has coronavirus impacted the US meal-kit market? How has the TAM and household penetration evolved, pre- to post-pandemic?
2.
Do you doubt the slight pullback you mentioned will take us anywhere towards pre-coronavirus levels? Is the new, higher tide here to stay?
3.
How does the coronavirus customer’s profile relate to that of the traditional pre-coronavirus customer? Are there any notable differences?
4.
What could remain the key focus points for customer retention at HelloFresh? We’re obviously returning to
the office from a WFH environment, so things may change slightly. Will the focus very much be convenience
and flexibility?
5.
Could quality be a risk as HelloFresh scales and the cost line becomes more of a focus?
6.
How challenging is personalisation operationally? Is this an easy value-add benefit? There must be a lot of data coming through now from purchasers, which gives HelloFresh an advantage here.
7.
You touched on convenience, quick-recipe or ready-to-make meals. Does HelloFresh’s acquisition of
Factor75 serve this purpose? Is it a real complementary offering to HelloFresh?
8.
Is HelloFresh still some distance from building total functionality across its namesake brand, Factor75 and Green Chef and offering the customer experience you described? Is the company on top of this? Could this be realised quite quickly?
9.
What are the unit economics of a Factor75 ready-to-eat meal vs the traditional box meal kits from HelloFresh?
10.
Could you outline a typical HelloFresh customer’s lifetime behaviour from first purchase to the back end? I think this is interesting given the new world we’re in.
11.
One analysis suggests that HelloFresh’s revenue is increasing from TAM expansion more than penetration. What factors or challenges should we have in mind around penetration? Does this speak to customer acquisition and any issues there?
12.
What are the most successful customer acquisition strategies and channels for HelloFresh?
13.
Marketing costs have increased to about 15.5% for HelloFresh in the US. Do you expect this heightened level to be maintained or to increase even further as the company tries to push forward? We discussed the pullback after the black swan event of the pandemic, but there’s still a lot of TAM to go.
14.
What’s your growth outlook across HelloFresh, Green Chef and EveryPlate? You mentioned that HelloFresh is the mass-market offering. Has one of these segments been more popular? Does any have better growth opportunities?
15.
Management seems bullish on entering lunch and breakfast. Is this a possibility for HelloFresh or is the lower-hanging fruit to further penetrate dinnertime? Could Factor75 come in on lunchtime especially?
16.
What cost price inflation do you expect to come through to HelloFresh from logistics and purchasing? This
is an important topic globally.
17.
How could HelloFresh react to any price increases coming through? Could it take the hit on margins or try to push costs through to price per box?
18.
How are promotions and discounting activity trending at HelloFresh, given they’re a big part of the company’s operations, including customer acquisition?
19.
Could more market entrants pose a competitive threat to HelloFresh? Can the broad offering and large TAM allow us to neglect competition for a while?
20.
Could big players such as Walmart and Amazon ever enter, especially given Amazon has Amazon Fresh? I can imagine its interest being piqued if this were a profitable market.
21.
HelloFresh is a big growth name in the US. Is there anything we should be cognisant about around this growth, or anything that may derail the positive story?
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