In the early months of the pandemic, as consumers turned to delivery options to meet their food needs, they had three main options: grocery, restaurant or meal kit. As delivery sales remain elevated even as mobility has increased, major players from each of the categories have been looking to capture consumers’ spending across all three. Now, Instacart is getting into prepared meals and meal kits. On Monday (Oct. 4), heat-and-eat meal and meal kit company Sunbasket announced that it has become the first direct-to-consumer (D2C) meal provider on Instacart’s marketplace.
Typically, the meal company’s offerings are only available by subscription — but on Instacart, consumers can order a single meal.
“Consumers are increasingly looking for convenience, and we see prepared meal and grocery delivery as a permanent fixture in the dining landscape,” Sunbasket CEO Don Barnett said in a statement. “Sunbasket is excited to offer more delivery choices of our restaurant-quality, nutritious meals through our partnership with Instacart.”
Instacart’s move into prepared meals puts it in competition with the major food delivery services — DoorDash, Uber Eats and Grubhub, among others — capturing consumers’ need for on-demand ready-to-eat meals. This escalation is only natural, given that food delivery services have been moving into the grocery space. Over the summer, DoorDash announced a nearly 2,000-store partnership with grocery giant Albertsons Companies, and Uber Eats doubled its grocery delivery presence.
By the Numbers
Research from PYMNTS’ report, The Bring-It-to-Me Economy, created in collaboration with Carat from Fiserv, finds that consumers are seeking out meals on-demand at unprecedented levels, and are now 31% likelier to eat their restaurant orders at home than they are to dine at a restaurant. Additionally, the customer base for ready-to-eat meal delivery is significantly greater than that of grocery delivery, with nearly half of all consumers ordering restaurant food for delivery more than they did before March 2020, compared to just about a quarter who are ordering groceries for delivery more often.
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What the Experts Are Saying
With this partnership, Sunbasket is in a sense taking the “if you can’t beat ‘em, join ‘em,” approach, since typically third-party marketplaces are in competition with D2C meal delivery companies.
“Our closest competitor is … probably your Grubhub, Uber Eats and delivery guys,” Mike Wystrach, CEO and co-founder of Nestlé-owned weekly food subscription service Freshly, told PYMNTS in an interview. “They’re really focusing on convenience, and how consumers get food when they’re at home and they don’t want to cook — I think that’s really the use case of our consumers [too].”
For Instacart, the partnership allows the delivery service to stay relevant even as consumers turn away from grocery and toward ready-to-eat options.
“The dynamic of the 1950s, where somebody would cook six square meals a week and maybe go out once a week, is going to be totally the opposite,” Marc Choy, president of Ghost Kitchen Brands, told Karen Webster in a conversation last month. “This is how people are going to know how to get their food — by ordering.”