Elise Spaan

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Nowadays, the meal-kit delivery service is a well-known concept and has become popular among young professionals and young families. The meal-kit delivery service is focused on providing convenience for people who have little time to do grocery shopping and cook or consumers who just do not like cooking or doing groceries (Helm, 2016). Most meal-kit providers offer a variety meal-boxes, where consumers can order via a subscription model. In this way, companies offer a product line where segmentation is based on self-selection (Christensen, Raynor, & McDonald, 2015).

One of the largest company offering meal-kit delivery service is HelloFresh. This company was founded in 2011 by Dominik Richter and Thomas Griesel with the intention to become a disruptive business in the food industry (Cleverism, sd). By offering pre-packaged ingredients with default recipes, HelloFresh succeeded to target a new-market foothold in between two segments of the food industry by taking customers from retail and fast food (Helm, 2016). HelloFresh is known for their aggressive marketing which resulted in a market share of 36% and a revenue of $678. Apart from the fact that HelloFresh occupies one third of the market, the company will no longer break even by the end of 2018 (Thakker, 2018). At the moment, this segment has become attractive in terms of pricing and size (Buck, 2018). Since, large grocery chains have entered the market as well, the segment has become saturated, and therefore, highly-competitive. These companies benefit from having their existing customer base, high reputation, deep pockets and network of suppliers. As a response, HelloFresh is acquiring other start-ups in the meal-kit delivery service market in order to sustain their competitive advantage (Molla, 2018). Besides, HelloFresh tries to differentiate and tapped into the recent rise in customer demand for fresh produce (i.e. separate vegetarian boxes and fruit boxes for special dietary requirements) (Helm, 2016).

Although, these developments show a great interest in the meal-kit delivery service concept, some question if meal-kits fit conveniently in people’s lives and whether or not many of these businesses are sustainable (Coppolino, 2018). The most prominent question is if HelloFresh will ever break-even. In the light of the latest developments and the saturation level of this market, what actions would you advice HelloFresh to take? And the other way around, what would you advice large grocery chains to do in order to stay alive in this highly competitive segment?

References

Buck, T. (2018, March 21). HelloFresh delivers higher revenues and narrows losses. Retrieved from Financial Times: https://www.ft.com/content/c503956e-2cef-11e8-9b4b-bc4b9f08f381

Christensen, C. M., Raynor, M. E., & McDonald, R. (2015, December). What Is Disruptive Innovation? Retrieved from HBR: https://hbr.org/1995/01/disruptive-technologies-catching-the-wave

Cleverism. (sd). HelloFresh. Retrieved from Cleverism: https://www.cleverism.com/company/hellofresh/

Coppolino, A. (2018, January 27). Home-delivered meal kits convenient but pricey as they disrupt industry model. Retrieved from CBC: https://www.cbc.ca/news/canada/kitchener-waterloo/andrew-coppolino-home-delivered-meal-kits-1.4505944

Helm. (2016, February 23). Please stop misusing the word disruption. Retrieved from Helmdigital: https://www.helmdigital.com.au/digital-strategy-blog/please-stop-misusing-the-world-disruption/

Molla, R. (2018, March 26). HelloFresh is now bigger than Blue Apron in the U.S. Retrieved from Recode: https://www.recode.net/2018/3/26/17165030/hellofresh-blue-apron-meal-kit-delivery-marketshare-acquisition-organic-green-chef

Thakker, K. (2018, August 14). HelloFresh won’t break-even until 2019. Retrieved from https://www.fooddive.com/news/hellofresh-wont-break-even-until-2019/530042/

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Defense Advanced Research Projects Agency (DARPA) announced in September 2018 a 2 billion dollar investment in Artificial Intelligence, called the “AI Next” campaign (Nu.nl, 2018). DARPA is an agency of the United States Department of Defense, responsible for the development of emerging technologies for use by the military (Wikipedia, sd). The purpose of this investment is to investigate how a machine could learn human skills, such as communication and problem solving abilities. Nowadays, Artificial Intelligence is used for speech recognition, autonomously operating cars, and intelligent routing in content delivery networks but also for military simulations (Wikipedia, sd). The latter one, however, will now be expanded with machines that enhance humans warfighting capabilities.
Although AI technology has the potential to bring positive effects to society, the appliance of AI in the army could also trigger further development of lethal autonomous weapon systems. Moreover, AI could be the enabler of a war where no human command is needed. In other words, greater levels of intelligence could change the way we fight war forever. The movie ‘Eye in the sky’ is one example of how the use of technology, in this case armed drones used as weapons of war, could raise a range of moral dilemmas with regards to a remote war (Baker, 2016). While the technology of a drone is not comparable to artificial intelligence, it makes you think of the possible consequences of the increasingly use of advanced technology in the army.
The chosen article is not only interesting due to the appliance of AI for military purposes, but also because it concerns an intensive risk to humanity. In the future, the power of government bodies will become dependent on the state of the technology used in military. Elon Musk openly spoke about his concern that military development in AI could trigger a World War III. In order to prevent an arms race, 26 countries of the United Nations have explicitly endorsed the call for a ban on lethal autonomous weapons systems. Also, several leaders and researchers in the field of technology signed this pledge (Nu.nl, 2018).
Despite the existence of this agreement, one could argue that the discussion concerns a double effect for the government with regards to military decisions. On the one hand, you do not want to part of a development that could potentially contribute to tremendous conflicts. On the other hand, if you do not invest in AI and other advanced technology there is a risk of losing power compared to other parties.

What are your thoughts regarding the use of AI in military?

Do you agree with Elon Musk that AI could trigger a World War III?

References:
Baker, D.-P. (2016, March 31). Eye in the Sky and the moral dilemmas of modern warfare. Opgehaald van The Conversation: https://theconversation.com/eye-in-the-sky-and-the-moral-dilemmas-of-modern-warfare-56989
Nu.nl. (2018, September 07). Defensie VS investeert 2 miljard dollar in kunstmatige intelligentie. Opgehaald van Nu.nl: https://www.nu.nl/internet/5452514/defensie-vs-investeert-2-miljard-dollar-in-kunstmatige-intelligentie.html
Nu.nl. (2018, July 18). Techleiders beloven geen wapens met kunstmatige intelligentie te ontwikkelen. Opgehaald van Nu.nl: https://www.nu.nl/internet/5370248/techleiders-beloven-geen-wapens-met-kunstmatige-intelligentie-ontwikkelen.html
Wikipedia. (sd). Artificial Intelligence. Opgehaald van Wikipedia: https://en.wikipedia.org/wiki/Artificial_intelligence
Wikipedia. (sd). DARPA. Opgehaald van Wikipedia: https://en.wikipedia.org/wiki/DARPA

Will HelloFresh ever break-even?

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Kill or be killed? Artificial Intelligence in military

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