Blue Apron is having a rotten summer.
The New York-based company on June 28 became the first US meal-kit service to go public. Such an event would normally be seen as a moment of strength for any company—except when, not even a month later, news breaks that Amazon is shoehorning its way into the same space.
As Blue Apron attempts to rev-up funding for an expansion, Amazon is reportedly already selling its meal kits to a handful of people who subscribe to Amazon Prime, the internet juggernaut’s service that clusters all sorts of benefits into one place.
One of Amazon’s 17 available kits includes steak au poivre with parmesan fries and snap peas. In an interview with GeekWire, one Prime user gave his Amazon meal kit a glowing review, noting that his peas were fresh and the steak was substantial. The price of each kit (which serves two) is comparable to Blue Apron: $16-$20 each.
Amazon’s meal kit is such a huge threat to Blue Apron because it’s wrapped into Amazon Prime. According to a 2016 report by Consumer Intelligence Research Partners, a huge swath of US households subscribe to Prime; consumers will have easy access to the meal-kit service, which gives Amazon a big leg up on Blue Apron from the get-go.
Much of Blue Apron’s revenue evaporates because of marketing costs. Amazon won’t have to face that sort of uphill battle, especially if it gives its new service good billing online.
This latest venture by Amazon is yet another indication that its future plans are very much hinged on getting more into food. Already it has the US grocery industry on edge after purchasing Whole Foods Market for $13.7 billion in late June.