Nestle cooks up fresh new opportunity

Nestle have just announced a $77m investment in US-based online ready meal subscription service Freshly to capitalise on strong consumer demand for healthy, yet time-saving meal options.

The deal is part of Nestle’s ongoing strategy to grow its healthier food business, and move away from slow growth categories such as confectionery. 

Operating in 28 states, Freshly delivers healthy ready prepared meals direct to consumers on a weekly subscription basis. The brand boldly claims that consumers will save “at least an hour” with every meal that would have been spent shopping, cooking, and cleaning.

While Freshly has an ambitious goal to see its meals in every US household; will the ready meal offering really appeal to that many Americans?

According to a 2016 survey by GlobalData, the majority (69%) of Americans prefer to cook a meal from scratch at home, rather than rely on prepared meals, takeaway or eating out. Furthermore, consumers are more inclined to look for products which make preparation easier; rather than being ready to consume.   

Freshly’s current ready prepared meal model is therefore unlikely to capture the attention of more than small proportion of the American households the brand ultimately hopes to reach.

However, there is still a strong convenience opportunity for Freshly – and Nestle – to capitalise on, with some tweaks.

A “recipe kit” model, similar to that made popular by brands such as Hello Fresh in the UK, could hold the key to larger scale success. Offering ready prepared elements in a convenient format which still gives the consumer control over the final preparation will tap into the needs of the large proportion of American consumers who prefer to cook, but are looking for a little help.