Marley Spoon et al. and a home video

This bit of advertising arrived in our junk mail collection last week. I assume it means that Eltham is now included in the places they deliver to and that this is a come on to get us to subscribe. I couldn't actually find whether this is indeed the case without getting into the ordering process, so I'm just guessing. Eltham is on the outer fringes of Melbourne, but their website does say they deliver to most of Melbourne.

I know I have touched on this concept before - the home delivery of recipes and ingredients for a home-cooked meal, but this time I am looking at a few different aspects I hope.

I'm not talking here about the prepared meals - the Lite n'Easys of this world - just those that give you the ingredients and the recipes. The meal kits I believe is the correct term.

And it looks like there are basically only two companies, three services, in Melbourne that do this - both of them German owned. Which is interesting is it not?

The first company owns Marley Spoon and Dinnerly. Yes they are both from the same people. Though you would never know it from looking at their websites. Indeed it has been an interesting experience looking at the websites of these three services. Nowhere on any of them does it tell you anything about the companies themselves and the people who founded them. So they are not like all the other food producers that I have looked at over the years. No heartwarming immigrant stories here. No these companies belong in the category of startups - young brash entrepreneurs out to make a buck. They might bandy trendy words like fresh and healthy around but they don't give you much chance to do anything but subscribe and order. Both the head of Marley Spoon and Dinnerly and the two heads of Hello Fresh are serial entrepreneurs, basically out to make money - which they are not actually doing. But more about that later. This is e-commerce writ large. Well maybe not large like Amazon, e-commerce hopefully large, but practically small to medium and possibly ultimately unsustainable. Large enough to be on the stock exchange and to talk in millions, maybe even small billions, but not world's top companies large.

The concept is that you (mostly) subscribe to a service and for a set price you get a number of meal kits per week - you decide how many and for how many - up to six people - for some it's only four. I'm not quite sure whether each meal is delivered separately or whether you get all the week's meals delivered at once. I think the latter. Whichever it is, what you get is a box with your chosen recipe cards, and all the ingredients you will need bar the things like oil and salt and pepper that you are likely to have at home. The fresh ingredients are not prepared - you do the preparation yourself, although some of the meat is cut up. Dinnerly differs slightly in that the recipes are online, not on paper. I gather the main difference between the two companies is that with Marley Spoon and Dinnerly you get to choose the individual meals on offer whereas with Always Fresh you just get given meals that fall within your general specifications - vegetarian, etc. I think there might be slightly different ways you can opt out as well.

First let's look at the issue of packaging. There is a lot of packaging in these meal kits. Everything is packaged separately - well maybe not the vegetables. So it's really not environmentally sound no matter how hard they try to make it look like it is with the look in their advertising. It might look like no packaging on their website, but the reality, as shown on a video I will tell you about is a bit different.

dinnerly

hello fresh

And here I will digress slightly to direct you to this home video from America, in which an enthusiastic lady tries to decide whether it's cheaper to cook your own meals from scratch or use the Hello Fresh option. Well to be fair to her - she compares making three Hello Fresh meals from Hello Fresh's service, and also from ingredients sourced elsewhere. She is actually pretty thorough, in that first of all she does a straight comparison - just buying exactly the same ingredients at the local WalMart, but not looking for special buys or anything, and then finally doing a costing using ingredients sourced at cheaper places and bought in bulk or on special. There was quite an incredible difference in cost. Of course the home options were cheaper but the difference between buying cheap and just going into a supermarket for specific items was much, much larger - I think the cost came down from around US$20 to something nearer $6.00. It's quite a long video but you can fast forward through some of the cooking bits. I found it interesting - she made quite a few good points.

Now it is American and I believe that in Australia one of these two companies makes a bigger margin because of the pricing, but her general points about the costings are pretty spot on.

Whilst I'm still on this video though two or three things I would like to say. The first is really a whole new topic that I should visit some other time - the amazing variety of blogs and videos made out there by 'ordinary' people. And it's a relatively professionally shot video too - speeded up sequences and all. Which just goes to prove that anyone can do it this these days. I'm guessing this lady makes money out of this because there are ads sprinkled throughout (you can close the ads after a couple of seconds). All power to her though as she is obviously not super rich - she has four children after all and a husband who does not look like a high powered executive.

Which brings me to my next point - about America anyway - alarmingly she maintains that her family is small - some of her neighbours have up to ten children! Which also, I think, probably places the neighbourhood in the lower strata of society. Donald Trump's America perhaps. Mind you she also makes a very good point that these meal services are not good for big families as the most you can get is for a family of six. (I don't know who this is.). In fact she implies that you can only get meals for two, which I don't think is quite true. Anyway, obviously this sort of plan is not a solution for the poor or for families. But then it's maybe not aimed at the poor and families.

on the plus side was that the food was delicious, and that she learnt new things about cooking, and her husband and children seemed to concur. I don't think she was getting kickbacks - they seemed very genuine, but I suppose you never know.

However, for a competent cook - she looked pretty competent and she did have things like pearl couscous in her pantry - she seemed to be completely unaware of other sources of recipes. She was enthused about the Hello Fresh recipes which are available online, but did she mention the internet in general or cookbooks or magazines as sources? No she did not - just not on her radar. As I said, there are endless blogs on the net and endless websites with recipes from the famous chefs of the world. If all you've got is chicken and carrots just feed in chicken and carrots and you will get a mind boggling selection of recipes to choose from. If you add the words cheap or fast or easy or healthy you will refine your search. No need for a meal kit company from my perspective. You don't have to be a fan of cookbooks like me.

If you look on the net you will also find quite a few bad reviews of the various companies - here is a typical one.

"We tried Marley Spoon for one month and walked away with good and bad feelings. The service was abysmal, the food quality was satisfactory, the ideas were great, but all in all, it taught us that you cant beat cooking for yourself using fresh ingredients that you select and buy yourself. I think this business may have its own "use by date" unless people become reclusive and housebound."

Those bad service criticisms were echoed elsewhere - food delivered in the middle of the night, food left out in very hot sun, poor quality ingredients, difficulty of extricating yourself from the subscription, and so on. But then, to be fair, people are much more likely to post bad reviews online than good.

So are they making money, these young ruthless - apparently they (particularly the Hello Fresh guys) entrepreneurs? Well not according to various financial reports that I found.

It's a comparatively new market. I believe it dates back to about 2014 - this was the reasoning behind the idea:

"Why are you going to spend $12 for the ingredients when you can go a step further and have a quality meal delivered straight to you for $12? That's the sort of thought process," Dean Fergie - Investment Manager

Well that probably refers more to the other kind of service - the Lite n'Easy thing where you get the cooked meal, but the basic premise is probably the same. No need to think about what to cook and no need to do the shopping. Which rather ignores the fact that you have to shop for all those other household necessities - the cleaning, the garden, the baby stuff, the lunchbox stuff ...

Anyway lots of people had the same idea but Hello Fresh seems to have emerged on top.

"king of a brutally competitive industry that at its peak had more than 100 contenders."

Mind you one of the companies - apologies, I can't remember which now - set up in Britain in 2014 too and closed it down in 2016.

Here in Australia I see that Marley Spoon's share price has been steadily dropping and I think has yet to turn a profit. I suspect the same is true for Hello Fresh. Why?

"HelloFresh, in its assertive way, was attempting to address what has emerged as a fundamental problem with the meal-kit business: People quit. Why? Perhaps the novelty wears off, or there's guilt about all the wasteful packaging, or simply because they are too lazy to cook a gourmet meal every night. Whatever the reasons, it turns out the majority of customers ditch their HelloFresh subscriptions after receiving only a few boxes." ...

Nearly half of subscribers of both services cancel within a month. Just 20 percent stay on as long as six months. By the end of the year, meal-kit companies are lucky if they've retained 15 percent of their original subscriber base, and the numbers dwindle from there." Burt Helm - Inc.

Therefore their costs are very high as they have to invest huge amounts in marketing, logistics, packing, materials ... But competition from everything from the local supermarket to the local takeaway, not to mention Übereats et al. makes it impossible to raise the prices too high.

I suspect the same is true for the complete meals too. Marley Spoon, perhaps in a bid to save itself has recently done some kind of deal with Woolworths, whereby Woolworths now owns a small percentage - around 10% (although it could maybe increase to something more like 25% of the company. Which really is interesting, because Marley Spoon originally saw itself as setting up in competition to the supermarkets themselves who are increasingly moving into prepared meals. But I guess the supermarkets cannot provide quite the same variety of products as the meal kit people. They are selling meal kits though. It will be interesting to see who comes out on top - the supermarkets or the meal kit entrepreneurs. My money is on the supermarkets.

The other major competition is the Übereats and Deliveroos, the takeaway options and restaurants and cafés themselves. For probably the main target audience for the meal kit services is the young professionals who get home tired and unenthusiastic about cooking an evening meal. I suspect these people are more spur of the moment kind of people than people who plan their meals out for the week. Indeed aren't most of us? I have never had a plan for meals of the week. What I cook depends on what I have in the fridge and what I feel like cooking. A spur of the moment thing. The millennials and the young professionals though are much more likely to order in a meal or go out for one than cook something delicious in fifteen minutes - whether they have paid for it from Hello Fresh or Marley Spoon, or been inspired by Jamie Oliver's Five Ingredients to cook from their own supplies.

And where did that name Marley Spoon come from? Well the American site will tell you:

"In the 90s while founders Til and Fabian were travelling through Asia they were swept up in an intense storm.

On their secluded island there was no Cowardly Lion, Scarecrow or Tin Man, but a delicious restaurant called Marley's - the warmth of the home cooking they received has never been forgotten."

Which sounds like something whimsical dreamt up by an ad man to me.

So no, I won't be subscribing and I don't think anyone should either. Why, why, oh why don't people understand how easy to cook up a delicious meal on your own it is? David managed a stir fry last night which was pretty delicious and it took all of 15 minutes from start to finish.

And thank you to Christine in America for her homely video. I rather enjoyed it - against my better judgement too.