We see this all the time in pricing-page teardowns. Older cohorts have a lower willingness to pay. We can also see a pattern in the relative willingness to pay based on age, though an inverse correlation:

Once into the $100k-plus brackets, willingness to pay shoots up. Looking at the willingness to pay based on annual income, we can see that, relative to the median, this is much lower for those earning less than $75k per year: Single people fall below that floor.Īdditional data points support the idea that there is a highly specific ideal customer for companies offering home meal-delivery kits. CAC and overhead together mean that there is a high floor to the lowest price these companies can charge. The overhead of food preparation, packaging, and shipping is also high. You can get a meal anywhere, but great recipes and enjoyment through cooking can come only with Blue Apron or HelloFresh as far as these companies are concerned. These companies are increasing that motivation by pitching their services as entertainment rather than just a meal. The high expense also requires more motivation. As the market becomes crowded, Blue Apron, HelloFresh, and all the others have to spend more to acquire customers. The lowest price they push new subscribers to, the $59.94 shown above, is double the solo willingness to pay.ĬAC and overhead are high for home meal-delivery kits.

The lowest price for a Blue Apron meal kit (two recipes for two people) is almost double that at $47.95. Our data from 4,219 current, former, or prospective customers of Blue Apron and HelloFresh shows that the median weekly willingness to pay for a single individual is just $29.86. HelloFresh has a “Veggie Plan,” but Blue Apron has “Vegetarian options available.” Both companies know their customer.Īnd knowing their customer, they don't offer a solo meal-they know there is no money in it: The pricing is slightly higher with Blue Apron, but they also offer free shipping.

Blue apron cost