Blue Apron Cooks Up A Weight Watchers Deal

By CultureBanx Team

  • Blue Apron partners with WW on 6 recipes

  • 75% of African Americans prefer cooking with fresh food

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Blue Apron’s (APRN +2.34%) new partnership with WW (WTW 1.37%), formerly known as Weight Watchers is its last hope to make the company profitable this year. African Americans on the go looking for quick and efficient mealtime solutions are an attractive consumer group for Blue Apron, especially with the The Selig Center’s expected buying power of this group set to rise to $1.54 trillion by 2022.

Why This Matters: Meal kits like Blue Apron are showing healthy growth among African Americans, with 75% of them agreeing they prefer cooking with fresh food, according to Nielsen. However, winning a customer and retaining a customer are two different things. Unfortunately for Blue Apron, this partnership doesn't solve its customer retention problem.

In the past, WW has partnered with some heavy hitting cultural trendsetters including Oprah Winfrey and DJ Khaled. All of this plays into Blue Apron’s strategy to get in front of more potential customers.

Meal kits like Blue Apron are showing healthy growth among African Americans, with 75% of them agreeing they prefer cooking with fresh food

As something of a luxury product, Blue Apron is particularly vulnerable to a recession, especially since the company is already losing customers and remains unprofitable. The way this new deal shakes out is that Blue Apron will pay WW fees for resulting subscriptions. If the partnership helps bring in customers at a lower cost than Blue Apron's traditional marketing, it could prove to be a valuable partnership.

Situational Awareness: The meal kit delivery service lost about 10% of its customer base in the third quarter, even though they spent more than 15% of their revenue on marketing. Usually the first quarter is Blue Apron's strongest, as the company capitalizes on the season along with folks New Year's resolutions. Right now shares of the company are flirting with the $1 mark, and are likely to remain volatile over the coming months. Blue Apron’s stock has tumbled nearly 75% in the past year.

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