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Love With Food acquires Taste Guru as consolidation in subscription food services continues

By Elizabeth Crawford

24-Jun-2015
Last updated on 24-Jun-2015 at 15:09 GMT2015-06-24T15:09:01Z

Love With Food acquires Taste Guru subscription food services

Snack box delivery service Love With Food’s acquisition of competitor Taste Guru, a leader in the gluten-free food delivery sub-category, signals the burgeoning online food subscription category already is consolidating as competitors vie for share in a fragmented market.

The deal, announced June 24, “brings us one step closer to achieving our goal of being the largest snack subscription service that helps consumers find great-tasting, junk-free snacks tailored to different dietary needs,” said Aihui Ong, founder and CEO of Love With Food.

She told FoodNavigator-USA that “many different variations” of online subscription snack and food delivery services currently exist, but that “now we are seeing the same consolidation that we saw in the daily deal space” several years ago when larger companies like Groupon and Living Social acquired their smaller competitors.

Ultimately, only two or three online subscription services will survive, predicts Ong. And as demonstrated by this deal and Love With Foods’ prior acquisition of the gluten free subscription food service G-Free Foodie just eight months ago, Ong intends for her company to be one of the last few standing.

The current acquisition is not just about consolidating the competition. Ong said it also was about establishing Love With Food as an authoritative and trustworthy source for gluten-free products, which are essential for success.

Prior to the acquisitions, Love With Food was known for providing healthy, natural and hard-to-find snacks, but “gluten-free is a different world to navigate and requires a higher level of consumer trust,” which Taste Guru had, Ong said. She said trust is vital for the gluten free space because the health stakes are much higher for people with celiac disease or gluten-intolerance than for most people who simply want a healthier, natural snack, Ong said.

“We wanted to gain the trust of the gluten-free community and that is why we decided to acquire G-Free Foodie and Taste Guru,” she said.

To further help Love With Food achieve this goal, the CEO of Taste Guru, David Fishman, will stay with Love With Food  as a recognized industry advisor who will “help push us forward in a much faster manner than we could do alone to get a strong footing in the space,” Ong said. However, the rest of the Taste Guru team will not join Love With Food, which Ong said already has sufficient staff to drive growth.

Gluten-free’s growth potential

While Love With Food has ambitious plans to offer tailored snack boxes for a wide variety of dietary preferences, including vegan, dairy-free and nut-free, it chose to start with gluten-free because the sales potential and growth are increasing exponentially for the category, Ong said.

She noted market intelligence agency Mintel estimates that 22% of adults choose a gluten-free lifestyles, creating an $8.8 billion market that has increased 63% since 2012.

In addition, she noted, one in 133 Americans have celiac-disease, and often their entire household will eat only gluten-free products to reduce the risk of cross-contamination and to simplify food shopping and preparation.

As a result, “this is a big market that we cannot ignore,” Ong said, adding she does not think gluten-free is a fad.

Plans for growth

Next year, once Love With Food is firmly grounded in the gluten-free subscription snack space, it plans to expand into another dietary preference, such as nut- or soy-free, Ong said.

She explained the company will tackle one dietary restriction at a time to ensure it can provide sufficient quantity, quality and variety of snacks in the space. She worries that if the firm took on too many specialized boxes at one time the quality would suffer.

“We want to ensure we continue to do it right by finding snacks that fit the specific dietary restriction and also continue to surprise and delight consumers because that is the beauty of subscription boxes” and that is what keeps consumers coming back, Ong said.

Stretching beyond snacks

The company also is expanding into non-snack products and beyond shelf stable foods, Ong said. For example, the boxes recently included coupons for free products from frozen food company Artisan Bistro and frozen veggie and fruit pop company Ruby Rockets, she noted. 

“We are always looking for healthier alternatives for our customers and by adding coupons for non-shelf stable products, it helps brands reach a very targeted audience in their home and at the same time helps our customers live a healthier lifestyle,” said Ong, adding: “It’s a win-win.”

Love With Food also works with brands to occasionally curate boxes, which provide added visibility for the curator. In the past, celebrity chefs have curated boxes, Ong said.

Brands interested in sampling their products in or potentially curating a box can learn more and submit a request at the company’s recently launched business-to-business website: www.lovewithfoodinteractive.com . Two months ago the firm launched the site, which is separate from the consumer facing website launched three years ago, to better manage and explain the potential of partnerships with Love With Food, Ong said. (Read more about how Love With Food can benefit brands HERE .) 

As Love With Food’s acquisitions demonstrate, the online retail space for food is evolving quickly. Learn more about its potential and the future of food retailing in general at FoodNavigator-USA’s upcoming in-person conference: Food Vision USA in Chicago Oct. 27-29. Find out more at register HERE

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