Thrive Market doubles down on frozen food while still navigating coronavirus supply chain hiccups

29-Jun-2020 - Last updated on 29-Jun-2020 at 15:12 GMT

Related tags Thrive Market Frozen food

With the launch of its frozen meals line last month and growing demand for its frozen sustainable meat and seafood line, Thrive Market has its eye on expanding and strengthening its frozen food portfolio which is seeing strong and sustained consumer interest, says the online retailer's chief merchandising officer.

For nearly every area of Thrive Market's business, additions to its online catalog of products are based on listening to customer feedback, said Jeremiah McElwee, chief merchandising officer at Thrive Market.

Roughly two years ago, the direct-to-consumer online retailer launched its sustainable seafood program, which ensures all of its products are sustainably caught and meet GAP (good agricultural practices) standards. Thrive Market also has a sustainable meat program which includes grass-feed beef products sourced from Argentina where cows can roam outdoors for 365 days a year and a pasture chicken program for its poultry products.

Its frozen meat and seafood line was a success with its customer base of 500,000+ members who started requesting more easy-to-prep meal solutions using frozen ingredients.

"The momentum of that really carried into our next step into frozen which has been frozen meals," said McElwee. "They didn’t want another meal kit that some of our other competitors were putting forward, they really wanted that heat-and-eat solution."

Last month, Thrive Market launched a line of paleo and plant-based frozen meals made from its premium proteins, organic and non-GMO ingredients, and free from preservatives and other additives. Its launch also coincided with the online retailer's long-term partner, Primal Kitchen's extension into frozen meals, whose products are also sold on Thrive Market's site.

It's foray into the frozen meals set is just the beginning, added McElwee, who said Thrive Market will continue to expand its frozen food offerings.

"We’re not done. We’re going to keep launching new meals into the category. We have some exciting partnerships coming this fall," he said.

Frozen food signifies fresh to consumers

"Even prior to COVID [the frozen food category] was growing double digits," McElwee said.

According to a report by the American Frozen Food Institute (AFFI), mid-March sales of frozen food products surged 94% compared to the same period in 2019. Even as sales declined after the initial panic shopping and freezer loading, frozen food sales still remained elevated at 30% to 35% in April compared to the same month the year prior, reported AFFI.

The perception of frozen food has also changed (for the better) with the advent of more advanced flash-freezing technologies -- which freeze food products on the spot sealing in freshness and nutrient quality-- and faster, more responsive supply chain models in which products reach consumers in shorter time frames.

"People are realizing that freezing products on the spot is a great way to preserve nutrient integrity and keep the freshness in the product," said McElwee.

"Because we’re direct to consumer, we don’t have warehouses where products are sitting on the shelf for months on end. We’re literally building to order versus a traditional frozen environment where products can sit at a distributor," explained McEwlee.

"You just don’t know much time has elapsed whereas in our environment we’re literally making them to order."

Supply chain hiccups

It's been over three months since most of the country went into varying degrees of quarantine and even as states reopen up their economies and consumers can return to restaurants and other foodservice outlets, Thrive Market is still feeling the impact of social distancing and shelter-in-place orders.

"We’ve seen a dramatic uptick in sales volume and we really haven’t seen much of a drop off at all," McElwee said. Operating as a direct-to-consumer business in the midst of global pandemic hasn't been without evolving supply chain challenges, which the retailer has done its best to navigate and mitigate to ensure it's getting products to consumers, many of whom are located in parts of the country where access to organic, non-GMO, and sustainable products is more scarce.

"The challenge has been throughout the supply chain have been there have been some pretty major blockages," said McElwee. "We’re still seeing hiccups [for example from overseas partners such as its Italian pasta program in which many shipments have been delayed due to port closures]."

However, as the company works through the kinks, McElwee said the business is getting back to some normalcy.

"We’re in pretty good shape right now – we’re running between 85% and 90% in-stocks across the network."

WEBINAR: Unlocking Innovation: Preventive health, wellness, and nutrition (self-care in focus)

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Hear more insights from Jeremiah McElwee into how consumers are thinking about health and wellness in the second webinar in FoodNavigator-USA's global Unlocking Innovation webinar series on July 23, which also features experts from IRI, ADM and Beneo.

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