Digital Marketing Strategy by Hello Fresh

Digital Marketing Strategy by Hello Fresh
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Executive Summary
Businesses have recognized the need to remain digitally relevant. Technological advancement has allowed businesses to find new marketing methods without over-relying on traditional media like TV, radio and newspapers. HelloFresh is one company seeking to expand its market share in meal kit services. Founded in 2011, HelloFresh has expanded into more than 15 countries. While HelloFresh is a leader in the meal kit industry, it faces stiff competition from other businesses offering similar services. This report will analyze the market in-depth, consumer behavior, product-market fit, and digital marketing communication strategy. Recommendations will be made on how HelloFresh can improve its digital marketing strategy to increase its market share.


Table of Contents

Executive Summary. 2

List of Tables and Figures. 4

1.0 Introduction. 5

2.0 Marketplace Analysis. 6

2.1 Market Size. 6

2.2 Competition. 6

2.3 Macro-Environment Analysis. 7

3.0 Consumer Behavior. 8

3.1 Customer Personas. 8

3.2 Customer Segmentation. 10

4.0 Product Market Fit Analysis. 10

4.1 Product Fit 10

4.2 Business Model 12

4.3 Digital Value Proposition. 13

5.0 Digital Marketing Communication Strategy. 15

5.1 Social Media. 15

5.2 Content Marketing. 16

5.3 Influencer Marketing. 17

5.4 Search Engine Optimization. 18

6.0 Recommendations. 20

7.0 Conclusion. 21

References. 23

Appendix. 24

Appendix 1. 24

Appendix 2. 24

Appendix 3. 25

Appendix 4. 25

Appendix 5. 26

 

List of Tables and Figures

Table 1: PESTLE Analysis........................................................................................................ 6

Table 2: Cate’s Customer Persona............................................................................................. 7

Table 3: John’s Customer Persona............................................................................................ 8

Table 4: HelloFresh Customer Segmentation............................................................................ 9

Table 5: Social media followers.............................................................................................. 14

Table 6: Recommendations for HelloFresh Digital Strategy.................................................. 20

 

Figure 1: HelloFresh “Fresh Campus” in Berlin. Source: HelloFresh Group website. 4

Figure 2: Business Model. Source: Elluminati (2023) 12

Figure 3: A screenshot of a blog talking about HelloFresh plans. 15

Figure 4: A screenshot of a YouTuber reviewing HelloFresh meal kits. 16

Figure 5: Audrina Patridge promoting HelloFresh on her Instagram page. 17

Figure 6: SEMrush analysis of top keywords. Source: SEMrush (2023) 18

Figure 7: SEMrush analysis of hellofreshgroup.com domain. Source: SEMrush (2023) 19


Digital Marketing Strategy by Hello Fresh
1.0 Introduction
HelloFresh is a publicly traded meal kit company based in Berlin, Germany, which started in 2011. In 2012, the company expanded its base to the United States (US) and became the largest meal kit provider. HelloFresh has continued to expand to more markets and is currently in more than 15 nations. The business model is based on delivering premeasured ingredients and step-by-step recipes to the clients, enabling them to prepare the meals at home (HelloFresh Group, 2023). Clients are free to choose from a variety of weekly meals. HelloFresh aims to make home-cooked meals convenient to individuals with busy lifestyles who want to eat healthy meals cooked at home. HelloFresh has experienced significant growth, with increasing revenue. In 2017, the business went public and is now listed on the Frankfurt Stock Exchange. This paper is a critical review of the digital marketing strategy of HelloFresh.
Figure SEQ Figure \* ARABIC 1: HelloFresh “Fresh Campus” in Berlin. Source: HelloFresh Group website
2.0 Marketplace Analysis
2.1 Market Size
HelloFresh operates in the meal kit delivery market, a subcategory of the food delivery industry. The company operates in a lucrative industry, given that the meal kits industry was valued at more than 15 billion dollars in 2021 and focused on growing to 25.6 billion dollars by 2027 (Statista, 2023). HelloFresh has been growing at a high rate since its formation in 2011. In 2013, the business generated a revenue of 14 million euros. In 2022, the revenue grew to 7.6 billion euros. 2020, HelloFresh expanded its market significantly (Statista, 2023). The COVID-19 pandemic in 2020 accelerated the growth of the meal kit market as more individuals opted to cook at home in the wake of restaurant closure and social distancing measures. In the same year, HelloFresh more than doubled its size due to increasing product demand.
2.2 Competition
The meal-kit delivery market is highly competitive, especially in the US, with numerous players like Blue Apron, EveryPlate, Gobble, and Freshly Inc, among other major competitors in the US and Marley Spoon and Gousto in Europe. However, despite the stiff competition, HelloFresh is the market leader in the US, with a market share of 56.4%. According to Statista (2023), HelloFresh had about 3.5 million US clients and roughly 1o times as many as its closest competitor Blue Apron. At the same time, HelloFresh has a strong brand reputation and customer base in other countries. The business has continued with its expansion strategy, entering more countries. The US remains the largest market in terms of net value. Profitability improves with higher maturity in each market penetration, with a break-even in markets of an average of 5.5 years.
2.3 Macro-Environment Analysis
In order to make a comprehensive market analysis, a macroenvironment analysis assessment (PESTLE) has been done, as shown in the table below.
Political
* Regulations regarding food safety and packaging impact the operations of meal kit companies
* Navigating government regulations is costly and time-consuming, hence meal kit businesses have to consider the implications of operating in different jurisdictions.
* Lobbyists supporting the traditional grocery industry influence the government to maintain the status quo, hence meal kits experience resistance from lobbyist groups.
Economic
* The price of ingredients keeps fluctuating, affecting the business's profitability.
* Consumer spending habits and disposable income affect the demand for meal kit services
Social
* Clients are becoming more aware of the benefits of consuming healthy meals
* Changes in food habits can affect the demand for meal kits
* A diverse society means meal kit businesses have to expand their services to meet the needs of their consumers
Technological
* HelloFresh must remain updated on the latest technologies to avoid using outdated technologies.
* The availability of data means HelloFresh can track the needs of the consumers and avoid wasting resources
Legal
* The operations of HelloFresh must remain within the confines of the law. The business must comply with the laws of the countries where it operates
* HelloFresh must sign contracts with other businesses, like suppliers, to establish long-standing relationships
Environmental
* Consumers are more aware of the need for businesses to protect the environment. The ability of HelloFresh to market itself as environmentally sustainable will impact its sales
* More clients prefer recyclable and renewable packaging materials even though they are more expensive.
Table SEQ Table \* ARABIC 1: PESTLE Analysis
3.0 Consumer Behavior
3.1 Customer Personas
Name: Cate
Gender: Female
Age: 32
Occupation: Nurse
Bio
* Cate is a 32-year-old female working as a nurse in one of the leading healthcare facilities in the US.
* Cate is single but has a boyfriend who works in another city.
* As a nurse, Cate has a busy schedule and must work long hours.
Interests
* Cooking at home
* Prefers organic products
* A vegetarian
* Engages in healthy lifestyles like going to the gym
* Follows celebrities and social media influencers online
Challenges
* Inadequate time to visit grocery shops
* Lack of time to experiment with new recipes
* Operates on a tight budget
Solutions
* HelloFresh can deliver the meal kits to her doorstep
* Meal kits come with recipes to allow clients like Cate to experiment with new recipes
* HelloFresh is cost-effective, allowing clients like Cate to afford products
Table SEQ Table \* ARABIC 2: Cate’s Customer Persona
Name: John
Gender: Male
Age: 73
Occupation: Retired
Bio
* John is a 73-year-old retired engineer currently living alone because his wife passed on two years ago
* He has a passion for cooking and has been doing it for many years. However, he has mobility issues, making it challenging to go to the grocery store.
* Since living alone, he lacks the motivation to cook and order processed or convenience foods.
Interests
* Prefers cooking at home
* Wishes to consume healthy products
* Not a vegetarian
Challenges
* Mobility challenges hinder him from visiting grocery shops
* Lack of motivation to cook for himself
* Challenges planning his meals
Solutions
* HelloFresh can deliver the meal kits to his doorstep
* Meal kits are pre-planned and pre-portioned, so John does not need to worry about planning what to eat
* HelloFresh has a variety of healthy meals to fit his dietary needs
Table SEQ Table \* ARABIC 3: John’s Customer Persona
3.2 Customer Segmentation
The customers for HelloFresh are diverse and can be categorized into the following segments
Age
HelloFresh targets people of diverse ages ranging from young professionals to senior citizens
Lifestyle
The business targets busy people, health conscious, environmentally conscious, and prefer to cook their meals at home rather than eat out
Income
Middle- and upper-income earners
Behavioral factors
People who want to save on time, are looking for the convenience of pre-planned meals and can pay a premium for meal kits
Geographic location
HelloFresh serves clients in different countries where it is located
Table SEQ Table \* ARABIC 4: HelloFresh Customer Segmentation
4.0 Product Market Fit Analysis
4.1 Product Fit
HelloFresh has a strong product fit because of the following:
* Addressing the needs of busy clients. The product fit enables clients a cost-effective way of preparing healthy meals at home without the need to undertake lengthy meal planning and spending time shopping for groceries. The business allows clients with less experience in coking to prepare meals at home using the ingredients and recipes provided. Such clients can prepare excellent and healthy meals without having extensive cooking skills.
* Ability to customize meals. HelloFresh provides the freedom for clients to customize their meals. Unlike restaurants with less control, HelloFresh allows customers to customize their meals to meet their dietary requirements. Such an approach ensures that the business works to meet the needs of various clients. For instance, people looking for vegetarian and low-calorie meals can easily purchase the ingredients that allow them to prepare meals that meet their preferences. Even for people shifting to healthier meals, HelloFresh facilitates their shift by allowing them to access recipes that allow them to transition smoothly.
* Competitive prices. The company appreciates that customers are looking for cost-effective meals which are also healthy. The competitive prices allow clients to afford its products, attracting more clients. HelloFresh purchases ingredients on a large scale from its suppliers, which allows it to get massive discounts. With the relatively low cost of the purchases, the business can of