According to sensortower, while APRN's app rankings increased slightly around March 16, it seems to have fallen back down. The data supports our claim that APRN has shown little increased demand for its services.
Therefore, while many people may order APRN's services just to try it out, we believe there is no incentive to use APRN's services over the long term. Admittedly, Blue Apron likely has better ingredient quality, but even accounting for this, it is still far more expensive than ordering from the nearby grocery store. Meanwhile, APRN costs between $8 and $10 per serving, around 3-4x the cost of what an average American usually pays for a meal. For reference, this equates to less than 2% of yearly food spend for the average American household. On Instacart, you can pay a $99 membership to get 2h grocery delivery on orders above $35 for free. If you're trying to save money, go to grocery stores to shop.Įven with the COVID-19 situation, grocery stores continue to be open around America, and even if you don't want to physically shop for your groceries because you're in an at-risk group, the option of grocery delivery is still open.Ĭompared to APRN, grocery delivery is incredibly cheap. If you can splurge and want convenience, pick food delivery. Sounds good right? Let's look at the options.Ī modern-day consumer now has multiple options to feed themselves, with the options listed in the chart below.Īs you can see, meal kits are sandwiched right in the middle, so there is no reason for either wealthy or poor consumers to use APRN's services in normal circumstances. For those unfamiliar, APRN offers a service that sends a "meal kit" comprised of raw foods, as well as sauces, that allow somebody to cook a number of meals, something like this:Īccording to APRN's website, they help chefs of all levels cook incredible meals at home by taking care of menu planning and shopping, so all the chef needs to do is to cook and enjoy the food. The main problem with APRN's service is that it just doesn't provide a good value proposition for most of America.
While bulls point to increased demand for meal kit services during this pandemic, we believe the incremental demand is not enough to stave off bankruptcy and we believe that eventually, the company will fall back to single digits. Blue Apron( NYSE: APRN) stock has been one of the main benefactors from the coronavirus, running up from a low of around $2 to $12 currently.
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