Recipe box startup Gousto stopped accepting new customers and froze marketing spend when the UK entered lockdown. Demand greatly outpaced supply until it could squeeze more from its automated factory. After output was increased by 30%, Gousto planned an ambitious virtual dinner party, mixing celebs and thousands of subscribers. What could possibly go wrong?
Last Friday (22 May), Gousto chief marketing officer Tom Wallis was drumming up excitement about the ’Table For 1 Million’ campaign, a virtual dinner party Gousto planned to host with Nick Grimshaw, Paloma Faith, Katherine Ryan, David Haye and a horde of loyal Gousto subscribers that night.
Attendees had booked their place at the virtual table and set about crafting the perfect Friday supper from their recipe boxes, with the promise of a night of glitz, glam and fine-dining with the stars, all of which would end in a Q&A.
Wallis was telling us just how ambitious the campaign – developed with PR agency Manifest – was, and how, despite weeks and weeks of prep, there were still some butterflies for the big night. All the preparation in the world wouldn’t mean a thing if a gremlin got into the in-house streaming tech.
When it came time, Gousto did, for a few minutes at least, coordinate a huge virtual dinner with Nick Grimshaw. But then, after a long delay (picture all those cold dinners) and then entrants were faced with frozen screens of celebs tucking into their meals. Paloma Faith’s enjoyment of a taco apparently provided solace to many.
Rather than seeing the night ruined, Gousto’s subscribers seemed to get on with their virtual dinner without the stars and, judging by online responses, the community appreciated the effort, even hoping for more dinner parties in the future.
In failure, there was a very clear indicator that Gousto has built a passionate community. All things considered, the scheme raised more than £40,000 for the Trussel Trust foodbanks and kept a thousand people amused – or bemused – in some way.
Gousto in lockdown
Gousto has huge momentum behind it and a live stream hiccup won’t slow it down. Founded in London in 2012 by entrepreneur Timo Boldt when he was just 26, its recipe boxes were on the up before lockdown and since then that demand has skyrocketed.
Wallis is, by all accounts, quite open about the ups and downs of running its marketing operations. He has been at the company for almost four years – in the CMO’s chair for one and a half of them – and before that clocked in time at Sky and Ovo Energy.
For the first eight weeks of lockdown, the company couldn’t accept new customers (I was one of the rejected masses). “We were focusing on ensuring that our existing customers continued to get the service that they expected,” he says.
“Pre-Covid-19, we were seeing business performance when in excess of what we’re expecting. After lockdown, in a matter of hours, we saw the same sort of volume we’d expect to see in a couple of days. It ramped up very quickly.”
Working from home, the team watched custom flooding in – at first with joy and then, perhaps, fear. They were approaching that magic number they couldn’t breach, maximum supply, and a rapid response was needed to stem the tide.
“Engineers had to build the block in the website in a few hours, and then we put the copywriters and marketing team on getting the copy right, and the customer care team was briefed its responses for social media.”
Gousto is now looking at new factory sites to greatly increase its output. The current site in Lincolnshire is at capacity and it has the capital to invest – a recent funding round gathered £33m, including backing from everyone’s favourite fitness guru, Joe Wicks. Gousto is also working on next day delivery and meal customisation. To deliver this, it is eyeing up 400 new staff members and aims to have 1,000 employees by 2022.
It is worth reiterating that business was indeed booming before lockdown. In the first quarter of 2020, revenue grew 70% year-on-year and Wallis attributes this to 2019’s £3m ‘Give it Some Gousto’ campaign. Its purpose was to snatch supermarket custom and was targeted at busy UK families. Before its latest capacity buff, it was sending more than 4m meals to some 380,000 UK households monthly. It aims for five-factor growth by 2025.
As a marketer who didn’t particularly need growth during this time, Wallis was one of the privileged few. His focus had instead been on service and retention. “When you can’t acquire new customers, it doesn’t really make much sense to spend money on speaking to them, so we haven’t really spent anything over the last few weeks.”
Instead, PR was the focus, he says, claiming a 93% share of sector voice in May. And the social team has been important in managing subscriber queries and concerns and to cultivate the community that gives them a sense of belonging.
“The team that would normally be working on acquiring new customers have shifted their focus to producing more content, communications and newsletters.”
the piece de resistance was to be ’Table For 1 Million’: “What a great idea would be to try and bring the nation together.” It remains a great idea.
“This was a continuation of our efforts to build a stronger community,” Wallis explains. Those who booked a seat at the dinner party now serve as a sales leads, but the main objective of the campaign was to “remain top of mind and keep brand awareness and affinity strong”.
He adds that the danger is “if you go silent in a pandemic or a recession, you will be forgotten about”. But while Gousto went silent on the call, it seems to have enjoyed a large PR boost from the event.
There are a great many competitors hungrily eyeing up the sector and, according to Wallis, trust is the real differentiator. Early in the lockdown, positive headlines were generated upon the news Gousto was prioritising sign-ups from vulnerable people more at risk from the virus. “That generated an awful lot of trust and positive conversation and that itself breeds retention. Our customers know that we've got their backs.”
Gousto measures this via net promoter score (NPS), which it claims has never been higher. NPS says Wallis, correlates very closely with retention. But will it last? He hopes so, saying he has “seen a huge, perhaps forced, adoption of online purchasing behaviour” that he predicts will persist, if at a lower level.
“It’s not going back to how it was before, so we will make bold decisions about the outlook for the sector and make even bigger investments.”
The UK’s online recipe box market was previously expected to exceed £1.5bn by 2022, but forced adoption is likely to accelerate growth. It’s apparently an addictive routine too. “With our product, we know that building the habit encourages retention. So the more boxes you order, the more you fit it into your life, and then you’re more likely to continue using it.”
And then there’s the word of mouth effect. Recipe box users fancy themselves as social influencers and are proud to deliver a meal that looks just as tasty as the one pictured in the recipe. These super fans tend to do a lot of Wallis’s job for him. This again ties back in to high NPS scores. “What we are driving and fuelling is a virtuous circle of demand – we’ve high enough organic demand right now.”
That said, there are more above-the-line efforts in the works. Especially when that second factory is up and running. But for now, let’s hope we haven’t witnessed Gousto’s last supper.
Update: Ali Maynard James, managing partner at Manifest, later told The Drum: "Despite all the careful planning, the unique limitations of lockdown combined with network issues out of anyone's control regrettably scuppered the livestream. Even without it, the bold campaign still commanded a reach of over 2bn through earned media alone, raised more than £40,000 for Britain's food banks, got thousands of people dining together, gave Gousto a huge majority share of voice across the category for a month and generated hundreds of thousands of positive engagements with the brand, a pretty decent pay off for its bravery."