Stay-at-home orders and closed restaurants during the coronavirus pandemic gave way to more consumers cooking at home, bringing tremendous sales growth to grocery stores over the last several months. And for those consumers looking to make it a little easier on the cooking experience, meal kit solutions have seen a bump in popularity, too.
Home Chef, the company acquired by Kroger in 2018, can speak to that growth. The Chicago-based company said it delivers more than 3.5 million meals a month and has seen annual sales grow in the triple digits. In addition to being a delivery meal kit service, Home Chef meals are also sold exclusively inside Kroger’s 2,000 stores. The delivery service enables consumers to choose from nearly 20 weekly rotating recipes, controlling portion size and how many meals to be delivered a week.
Rich DeNardis, chief revenue officer at Home Chef, spoke with Store Brands about the meal kit trend and working with Kroger.
Store Brands: Describe how the pandemic has impacted Home Chef’s business; it seems with more cooking at home, the meal kit industry is in a strong space to help consumers.
Rich DeNardis: Home Chef has seen nearly triple-digit growth year-over-year. We still see continued adoption from new customers, and our current customers are ordering from us more frequently than this time last year.
At the onset of the pandemic, we saw an increase in retail sales and online orders as people were stocking up and preparing to hunker down for a few weeks. As the pandemic progressed and people began to return to their normal shopping patterns, we found that many still wanted a delicious home cooking experience, but they wanted to save time doing it.
In response to this “cooking fatigue,” we are offering different meal kit options with various levels of required cooking — Oven-Ready meal kit recipes, heat-and-eat soup, Sicilian-Style pizza, and even holiday side dishes that can be heated in minutes to ensure that our consumers always have something fresh, convenient and simple for every occasion.
SB: In what ways has the company pivoted during the pandemic, perhaps how it handled in-store, how it handled other food trends or shopper behaviors?
RD: Initially, we made some adjustments to our menu to ensure that we could meet demand and get meals out to as many people as possible, including frontline workers and vulnerable populations unable to shop for groceries.
We also started a relief fund for hungry families, including a $100,000 donation to Feeding America. We constantly think about how our customers’ lives are changing this year and try to move with them. Customer feedback is an integral part of our product development and informs many of our product innovations and business decisions.
In the fall, we saw an uptick in college students and faculty signing up on campus, as COVID-19 restrictions forced many dining halls and food service programs to close. This was another reflection of how our lives, spaces, and dinner tables have changed under the shadow of the pandemic.
SB: How does Home Chef work in stores with its exclusive offerings in Kroger, and does it, partner up at all with Kroger’s line of own brands like Private Selection, etc., and how so?
RD: As a Kroger subsidiary, we work closely with cross-functional teams across the Kroger organization to bring Home Chef products to shoppers. Occasionally, our team will cross-promote with other Kroger brands from a marketing perspective.
SB: Where did Home Chef step up for the holidays this year?
RD: On homechef.com, we offered holiday menus for customers who wanted to have a holiday meal shipped directly to their door. The perfect option for families celebrating virtually. The menu included:
- Turkey Breast Roast (serves 8-10) - $44.98 - for Thanksgiving only;
- Spiral Cut Bone-in Ham (serves 8-10) $59.98 - for Christmas only;
- Loaded Mashed Potatoes with Bacon, Cheddar, and Green onions (serves 6) - $2.66/serving;
- White Cheddar and Sage Biscuits with Honey Butter (serves 6) - $2.66/serving;
- Pecan, Cranberry, and Sage Stuffing (serves 6) - $2.66/serving;
- Caramelized Onion and Green Bean Casserole (serves 6) - $2.66/serving; and
- Apple Cranberry Crumble (serves 6) - $2.66/serving
In Kroger stores, Home Chef Holiday Bundles included a choice of protein, traditional holiday side dishes, dinner rolls, and a delicious dessert — all in one box. The featured meals required minimal cook and preparation times with ready-to-heat sides for a stress-free holiday celebration.
- Oven Roasted Bone-In Turkey Dinner - $70;
- Smoked Bone-In Turkey Dinner - $70;
- Boneless Turkey Dinner - $55;
- Bone-In Ham Dinner - $70;
- Boneless Ham Dinner - $55; and
- Prime Rib Dinner - $80
Each bundle included Green Bean Casserole, Sweet Potato Souffle, Mashed Potatoes, Turkey Gravy, Kings Hawaiian Rolls, Old Fashioned Bread Stuffing, and 10” Pumpkin Pie.
SB: What food trends are you seeing out there in the year ahead that Home Chef may respond to?
RD: People may be spending more time at home, but that doesn’t make them less busy. Families juggling remote work and virtual learning have been cooking at home since March, and they are starting to burn out from all of the planning, shopping and preparation. Our customers appreciate that Home Chef offers a wide variety of different meal kits with convenient prep so they can spend less time on meal planning and still put a delicious, homemade dinner on the table for everyone to enjoy.
In 2021, we expect to see the food-at-home trend continue with customers seeking convenience and embracing meal kit options like our oven-ready line that comes in an oven-safe tin, eliminating the need for messy dishes. Our ready-to-heat meal kits, pizzas, and soups require no preparation and can be heated in minutes on busy weeknights.
We are also seeing customers seek more variety and more choice in their meal plan. This past summer, we partnered with Impossible Foods to bring their meatless Impossible Burger to our menu. Our “Customize It” menu feature offers customers the opportunity to swap or double the protein in their meals to deliver a more personalized dining experience.
SB: What can we expect from Home Chef in 2021 and after the pandemic eases its grip on the country?
RD: We are very optimistic about the trend for meal kits over the coming years. The pandemic has fundamentally changed the way people buy groceries — my parents were never online grocery shoppers before the pandemic, but now they will never go back. We have seen many new customers come into the category, including some who may not have considered meal kits before. We expect that many of them will continue to cook with Home Chef as they have come to appreciate the quality of our meals and the convenience they offer. We are continuing to listen carefully to our customer feedback and find new ways to provide them with a delicious home cooking experience.