Thrive Market, which first launched in 2014, had been growing at a rate of 40% a year before the pandemic. Now, with new customers joining the membership-based online grocery service, that growth rate has more than doubled to 90% a year, according to the company’s co-founder and CTO Sasha Siddhartha.
“We were already a digital native experience, so there were lots of parts of the business that scaled naturally,” Siddhartha said on the latest episode of the Modern Retail Podcast. Thrive Market was also already running on a largely remote workforce.
That growth was in part charged by the fact that about half of the service’s members are in the Midwest and Southeast, “which are areas that maybe traditionally are regarded as health food deserts,” Siddhartha said. When the pandemic hit, customers in those regions were even less likely to make the lengthy trek to the kind of stores and products that would be much more common in a major metropolitan area.
Here are a few highlights from the conversation, which have been lightly edited for clarity.
Having a subscription plan helps with retention
“We definitely saw several waves of what would be described as panic buying going into the February/March/April time frame. The major benefit for us as a benefit is we’re membership-based. In order to shop the site and place an order on Thrive Market you have to sign up for a Thrive Market membership. It’s risk free and all that, but it does represent a little bit of a barrier so that people who want to join the Thrive Market community probably have more long-term intent than just buying their next one order in a time of emergency. As a result, our growth was incredibly accelerated, but at the same time we weren’t having the shelves stripped bare the way a retailer [would]. Once people onboarded, based on the fact we were able to provide a high quality customer experience, we’ve seen retention rates at an all time high.”
Pairing brand partners with customers
“We want to be in a position to connect our brand partners with the customer segments that are most likely to engage with them, particularly customers that maybe have not seen the brand before, but based on our data, we can ascertain would be a great fit. We always want to be delivering a message the customer wants to get, showcase products that they would want to buy versus just blasting them in a one-size-fits-all manner. The richness of our data set and our ability to understand our customer base and depth makes us a really competitive place for a brand to prospect for new [customers]. So definitely there’s an opportunity to tie in the relationships with our vendors and create a win/win situation.”
What’s next for Thrive Market
“We’re going to complete the website and mobile app rebrand. That’s one key priority. We’re going to continue to extend out the personalization roadmap — get to the point where we’ve got the ability to manage preferences at an account level throughout the shopping journey. The goal of the rebrand is: every single page is personalized, customers can come back and edit those preferences and turn on what is effectively account-level filtering, so that they can shop in a particular dietary mode and have the products that are most relevant pop to the top. Other major areas of investment for us, again mostly focused on facilitating basket building, are one: We want to roll out and expand on our shopping list features, allowing customers to directly shop recipes, curated lists from influencers and seasonal and relevant themes in one click.”