- Meal kit seller Blue Apron posted a 22% year-over-year increase in revenue during the fourth quarter of 2020, to $115.5 million, as the value of the average order rose to $61, its highest level since 2015, the company reported Thursday. Blue Apron posted a net loss of $11.9 million in Q4, an improvement from the $21.9 million it lost during the same period in 2019.
- The company expects to generate double-digit revenue growth and intends to boost spending on marketing in 2021, Chief Financial Officer Randy Greben said during an earnings call. Demand for meal kits during Q4 was driven by more expensive meal offerings, Greben said.
- Blue Apron sees its plans to introduce an array of new offerings in 2021 — including products it had intended to roll out last year — as a way to attract and retain customers.
The surge in at-home eating brought on by the pandemic looked, for a time, to be just the tonic Blue Apron needed to begin making money. But with exception of a surprise $1.1 million profit in the second quarter of 2020, the meal kit company has consistently been in the red since going public in 2017.
Now, with the public health crisis nearing its first anniversary, Blue Apron’s recently refreshed leadership team is looking ahead to the coming months with a sense of optimism. The company, which added four new members to its board of directors in October, hired Greben in January, following the November arrival of Chief Operating Officer Charlean Gmunder.
The company’s outlook is buoyed by the sense that people’s eating patterns may have changed for good.
“We expect that the ongoing changes in consumer behaviors as a result of the pandemic will continue to some extent even after the direct impact of the pandemic ends,” Blue Apron President and Chief Executive Officer Linda Findley Kozlowski said during the earnings call.
The ongoing acceleration in grocery e-commerce is also a positive sign, and serves as a leading indicator for consumer interest in the kind of choice and convenience Blue Apron offers, Kozlowski said.
Blue Apron brought in 5.3 orders per customer on average during Q4, a 15% year-over-year increase. Average revenue per customer was up 22% during the period, to $327.
Blue Apron’s strategy is built on the company’s plans to bring a number of new items to market this year, which Kozlowski said will benefit from the fact that the pandemic prompted it to delay introducing some products in 2020.
“We believe that the new products that were held back may be some of our most exciting introductions to-date, including expansion into different meal applications,” Kozlowski said, adding that Blue Apron launched more products in 2020 than in any other year in its history despite having to make adjustments.
Blue Apron expanded its fulfillment capabilities in Q4, giving it the capacity it needs to grow its menu and bring new products to market, Kozlowski said. The company was able to increase production speed as it reduced the amount of labor needed per pack line and cut the amount of time needed to pack each meal box.
Kozlowski also highlighted during the call Blue Apron’s decisions to let customers upgrade certain components of a meal and sign up to receive a second box per week. Those changes were key factors behind the strong average order size the company saw in Q4, she said.