Dive Brief:
- ConAgra Foods and Campbell Soup worked with Peapod to create new meal kits containing pre-measured, pre-cut, and pre-washed ingredients, according to a news release Tuesday.
- Overall food and beverage e-commerce sales are expected to reach $12 billion by 2018. According to eMarketer, food and beverage was only projected to hit 2.4% of the overall e-commerce market last year, inching up to 2.5% by 2016 and through 2018.
- Peapod now has more than 15 make-at-home meal kit offerings.
Dive Insight:
Food manufacturers are slowly but surely embracing e-commerce. Both Campbell Soup and ConAgra have each discussed e-commerce efforts, though ConAgra's so far have been more pronounced.
Last month, Food Dive reported PepsiCo, General Mills, and ConAgra signed up one or more brands to join Amazon Dash service.
But Campbell's digital investment is a noteworthy point that could translate easily to e-commerce development: "Overall, We continue to expect digital to represent about 40% of our total marketing spend across the company this year," Campbell Soup CEO Denise Morrison said at the company's CAGNY presentation this year. The company is positioning e-commerce to complement this, with China as a key focus.
Tyson Foods is another manufacturer eyeing the meal kit phenomenon. It announced at CAGNY conference an extended partnership with AmazonFresh, in addition to new meal kit brand Tyson Tastemakers.
ConAgra and Campbell's route of working with Peapod is a smart one if either company isn't looking to expand its food direct-to-consumer e-commerce offerings. Peapod's already established logistics make partnerships like this more attractive to manufacturers, as it's more financially feasible (and more likely profitable) than investing more in their own services. Expect experimental efforts in e-commerce going forward in direct-to-consumer — particularly on a subscription-style model.