Page 20 - Food&Drink July 2019

READY MEALS
Feeding the masses, well
A new partnership with supermarket giant Woolworths means huge growth potential for the subscription-based weekly meal kit service Marley Spoon. Kim Berry spoke with its CEO Fabien Siegel about the business and its future.
WHEN consumers walk into a supermarket, all the fresh ingredients are there for the taking. And yet, Marley Spoon CEO Fabien Siegel says, they end up cooking the same three dishes. This, he says is the beauty of Marley Spoon.
The weekly meal kit business offers customers 20 new recipes every week, delivered to you in exact portion sizes. “It is a very flexible personal solution. Your box is based on what you need and what you like,” Siegel says.
“People love it because it’s healthy to cook from scratch compared to eating frozen food or takeaway. It's nice to cook for your family, but most of all, it makes their lives easier.”
Siegel told Food & Drink Business the ability for Marley Spoon to serve customers directly like that is “a big point of difference” to supermarkets.
MANUFACTURING BEHAVIOURAL CHANGE
At the same time, the company does not see itself as a retailer or a supermarket. “We manufacture our product, we are more of a manufacturing business.
“We manufacture a consumer brand that people love and that allows us, because we’re direct to the consumer, to only buy food we already know we’re going to ship. That is a big difference because we don’t have to waste any food, unlike the supermarket that has thirty per cent of food lying around and then going to waste. Our food waste is less than one per cent,” Siegel says.
That is only possible because of how the company manufactures, he says. “We have a technological advantage when it comes to mass customisation and manufacturing which enables us to have all of
this choice and variety. Over time we get to know each of our customers intimately.
“If a customer orders from us six times or more, selecting three out of twenty recipes each time, it allows us to predict what would you like with accuracy of more than ninety five per cent.”
The company’s recipe creation process is tightly connected to what it learns from customers and improves over time.
For Siegel, that individualisation capability has added benefits beyond customer satisfaction. He
says food waste is a bigger problem than people think.
“Seventy per cent of our fresh water use is not us washing our car or showering, it’s going to agriculture. And in the end, sixty per cent of what we grow we’re throwing away. A big chunk of that is happening in the supermarket and at the fridge.”
business model and they also looked closely at ours. They saw that our Australian customers on average spend around $240 a month with us. That recurrent spending probably used to be spent at the supermarket.
“From a Woolworths perspective, it’s probably also interesting to be close and
20 | Food&Drink business | July 2019 | www.foodanddrinkbusiness.com.au
“ We don’t see the need to grow into new geographies in order to capture or build a billion dollar business.”
SUPERMARKET SYNERGIES
While Marley Spoon is “very different” from Woolworths, Siegel says of particular interest to them is its experience in sourcing and building relationships with farmers and growers. The ability to benefit from that sourcing experience without having to change its own business model was a big plus for the company.
Siegel says: “To work with them is a growth partnership. And of course, it’s also a nice endorsement. Somebody like Woolworths understands their
engage with a company like us. “We’re still a very small
consumer based service compared to a supermarket. Last year we generated €90 million, or roughly AU$140-$150 billion. In Q1 results this year, the overall business globally grew fifty-six per cent
from the same period last year. That shows good growth in the business.”
ONLINE GROCERY
PLAYING CATCH-UP
Siegel explains that such strong growth is mainly due to customers starting to identify online as a