Albertsons has new plans for Plated

Just over two years after its acquisition by Albertsons Cos., Plated is being transformed from a meal kit provider into a private brand.

Albertsons said Tuesday it aims to phase out the Plated subscription service at the end of this month. Instead, Plated will become an “in-house culinary brand” on the Boise, Idaho-based grocer’s expanding roster of own brands. Plans call for new Plated products to roll out to additional stores next year.

“Our vision for Plated includes an expanded set of products that goes far beyond a dinner-based solution and into a comprehensive in-house culinary brand,” Geoff White, executive vice president and chief merchandising officer at Albertsons, said in a statement. “With a broader scope of offerings, we see Plated solving customer demands around convenience, lifestyle and cooking experience, while adding yet another layer of interest to our in-store journey.”

Albertsons acquired Plated in September 2017 in a reported deal of about $200 million. The supermarket giant noted that the move to bring Plated under its “Own Brands” umbrella comes after extensive testing of the meal kits’ performance at Safeway stores in Northern California. Results showed that customers who buy Plated products are more likely to have families and a larger-than-average shopping basket.

Related:Plated scales back retail distribution

“Plated’s brand appeals to our most loyal and highest value customers, especially those that skew towards convenient, fresh and organic products,” according to White.

Plated products will be sold online through stores’ current e-commerce platforms — including via same-day delivery and Drive Up & Go pickup — as the brand’s lineup grows, Albertsons said.

The Own Brands marketing and product development team will manage the expansion of Plated into a “holistic home meal solution,” Albertsons said, adding that the team has created billion-dollar brands such as O Organics, Lucerne, Signature Select and Signature Café.

Own Brands are a pillar of Albertson’s strategic growth plan. The retailer’s private-label penetration stood at 25.3% as of its fiscal 2019 second quarter, up from 23% in fiscal 2017. In 2018, 1,100 new Own Brand products were launched.

At the time Albertsons acquired New York-based Plated, meal kits were a burgeoning market, as on-the-go consumers sought a quick and convenient way to prepare a full meal for two or more people. However, the space has since migrated from a subscription to a retail distribution model, with shoppers looking more toward their local supermarket to buy meal kits as needed rather than signing up for a plan supplying them on a schedule.

Related:Plated CEO Josh Hix steps down

Albertsons announced the national rollout of Plated meal kits to its stores in April 2018, at which time the retailer had the kits in 20 Safeway stores in Northern California and 20 Jewel-Osco stores in the Chicago area. The company said Plated kits would be available in select Albertsons, Safeway, Vons, Jewel-Osco, Shaw’s, Acme, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market and Haggen stores by the year’s end.

Yet it became clear that changes were afoot this past January, when Plated co-founder and CEO Josh Hix left the company. At the time, Plated meal kits were sold at more than 300 Albertsons Cos. stores, and there were five Plated fulfillment centers. Then in March, Albertsons said it was shrinking retail distribution of Plated products as the company reassessed its in-store market strategy for the brand.