Grove Collaborative Holdings, Inc. (GROV): Business Model Canvas [Dec-2025 Updated]

You're looking at a company trying to pivot from just cleaning supplies to a full health and wellness marketplace, and honestly, the execution matters more than the vision right now. Grove Collaborative Holdings, Inc. is betting big on its curated, plastic-neutral Direct-to-Consumer (DTC) model, aiming for profitability after a major technology overhaul. With a base of $\mathbf{660,000}$ active DTC customers as of Q3 2025 and a solid $\mathbf{53.3\%}$ gross margin in that same quarter, the numbers suggest they are stabilizing the core business. We need to see if their new tech stack can truly drive that subscription revenue stream past their $\mathbf{\$172.5}$ million to $\mathbf{\$175}$ million full-year revenue guidance. Dive below to see the full nine blocks of their strategy-it shows exactly where they are spending and how they plan to earn it back.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Grove Collaborative Holdings, Inc. (GROV) has locked in to power its marketplace and drive its mission. These aren't just vendor agreements; they are foundational to the company's platform strategy and growth ambitions as of late 2025.

The technology stack overhaul, which began in July 2024, was largely complete by the first quarter of 2025, though the migration itself had a negative impact on Q1 2025 eCommerce revenue of between $2 million and $3 million.

The strategic M&A relationship is designed to fuel expansion beyond core cleaning products into adjacent wellness categories. Grove Collaborative announced a partnership with HumanCo Investments to finance up to $100 million in new mergers and acquisition opportunities focused on wellness and beauty brands.

Supply chain efficiency is being addressed through automation. Grove Collaborative tapped RELEX Solutions to streamline forecasting, replenishment, and pricing capabilities. This move from manual to automated planning is intended to improve availability and operational efficiency. For context on the partner's performance, RELEX reported 30% year-over-year growth in reported subscription revenue in the first half of 2025.

The marketplace itself relies on a broad network of external suppliers. Grove Collaborative curates a large assortment of high-performing, eco-friendly brands. The target number you mentioned is over 300 curated, high-performing, eco-friendly brands. As of mid-2024, the company reported having over 240 partner brands, which are instrumental in developing categories like beauty and personal care.

Here's a quick look at the brand mix as of late 2022, which shows the balance between owned and partner products:

• Grove Co. private label accounted for about 47% of net revenue.
• Third-party brands made up the remaining portion of marketplace revenue.

The company maintains its commitment to environmental responsibility across its operations, which includes its logistics network. Grove Collaborative ensures its shipments are carbon neutral, a standard applied to every product offered on Grove.co.

For a snapshot of the company's financial health as these partnerships are being leveraged, Q3 2025 revenue was reported at $43.7 million, with a Gross Margin of 53.3%. The company's cash and equivalents stood at $12.3 million as of September 30, 2025, as they work toward their full-year 2025 revenue guidance range of $172.5 million to $175 million.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Key Activities

You're looking at the core actions Grove Collaborative Holdings, Inc. must execute to stabilize and grow in late 2025. This isn't just about selling; it's about fixing technology, managing costs aggressively, and proving out the mission.

E-commerce Platform Migration and Stabilization

The immediate focus is on getting the technology right, as disruptions from the eCommerce platform migration weighed on recent results. The CEO specifically called out sharpening the focus on fixing the core customer experience, which includes the mobile app, subscription management, and payments. This stabilization effort is happening while the company navigates a competitive landscape dominated by e-commerce giants.

Here are the top-line results from Q3 2025, which reflect this friction:

Developing and Marketing Owned Brands

Developing and marketing high-margin, owned brands like Grove Co. remains a critical activity for margin control. The company is leaning into its owned brand portfolio, which shows a higher degree of sustainability alignment.

• Grove Brands % Net Revenue as of December 31, 2024: 40.1%
• Plastic-free status for Grove Co. products (95%+ plastic-free): 63%

Curating and Vetting Third-Party Products

Grove Collaborative Holdings, Inc. acts as a curator, ensuring third-party offerings meet its sustainability standards. This activity involves growing the ecosystem of like-minded partners.

• Number of brands selling reduced plastic products on Grove.co (as of July 2024): Over 240
• Number of brands selling reduced plastic products on Grove.co (as of 2020): 160

The company expanded its third-party selection notably across clean beauty, personal care, pantry, wellness, and baby categories.

Executing Cost Structure Improvements

Aggressive cost structure improvements are underway to drive profitability, even as revenue faces near-term friction. The most concrete action here is the workforce reduction.

The execution of a reduction in force in November 2025 is expected to result in approximately $5M of annualized savings. This discipline is reflected in the operating expense reduction seen in the third quarter.

Driving Mission-Led Initiatives

Maintaining and advancing mission-led initiatives is a core activity that differentiates Grove Collaborative Holdings, Inc. The company is plastic-neutral and has committed to carbon-neutral shipping and facilities.

• Total plastic recovered from nature since 2020: Over 17,200,000 pounds
• New goal for single-use plastic avoidance by 2030 (retroactive to 2020): 15 million total pounds
• Plastic intensity score (pounds of plastic sold per $100 of revenue) in 2023: 1.10

The company's direct emissions, which include all customer shipping and facility operations, are carbon neutral.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Key Resources

You're looking at the core assets Grove Collaborative Holdings, Inc. is leaning on right now to drive its strategy, especially while navigating the friction from its technology overhaul. These are the tangible and intangible items that make their value proposition possible.

The company's proprietary assets include its owned brands, like Grove Co., which are built around a commitment to sustainability, including packaging designed to be refillable and compostable, supporting their mission to be the world's first plastic neutral retailer. This commitment is formalized by their status as a Certified B Corporation and a Public Benefit Corporation, meaning they legally balance stakeholder interests alongside shareholder returns. Grove Collaborative Holdings, Inc. achieved a B Corp score of 100.9 in its 2024 recertification, significantly above the median score of 50.9 for ordinary businesses, and well over the 80 point qualification threshold.

The direct-to-consumer (DTC) engine relies heavily on its customer base, which totaled 660,000 active DTC customers as of September 30, 2025. This resource is being actively managed while the company executes a migration to a new, scalable e-commerce technology stack, which includes a move to the Shopify platform to improve personalization capabilities.

For immediate operational flexibility, the balance sheet shows the liquidity position as of the end of Q3 2025. Here's a quick look at the key metrics underpinning these resources:

The company's intangible assets also include its brand reputation tied to its sustainability standards. Grove Collaborative Holdings, Inc. has maintained its B Corp certification for over ten years, a milestone achieved by only about 5% of certified B Corps.

The core operational assets supporting the value proposition include:

• Owned brands emphasizing refillable and compostable packaging.
• Certified B Corporation and Public Benefit Corporation legal structure.
• Customer data from 660,000 active DTC customers.
• New e-commerce technology stack, including migration to Shopify.
• Cash and equivalents of $12.3 million for liquidity.

Finance: draft 13-week cash view by Friday.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Value Propositions

You're looking at the core reasons why a customer chooses Grove Collaborative Holdings, Inc. over other options, especially in a crowded e-commerce space. It's about what they deliver that matters most to their base.

The commitment to environmental stewardship is central. Grove Collaborative Holdings, Inc. positions itself as the world's first plastic neutral retailer, a status maintained since 2020 by recovering the same weight of ocean- and nature-bound plastic for every ounce sold. The company has a stated goal to avoid 15 million total pounds of single-use plastic waste between 2020 and 2030. By the end of 2024, Grove Collaborative reported avoiding 8.1 million pounds of this waste. In 2024 alone, the company collected 2.0 million pounds of plastic through its partnership with rePurpose Global, bringing the total recovered since 2020 to over 17.2 million pounds. This focus translates to operational metrics; the Plastic Intensity ratio-pounds of plastic sold per $100 of revenue-was 0.99 pounds in the first quarter of 2025, an improvement from 1.08 pounds in the first quarter of 2024.

The offering is a tightly curated marketplace, evolving into a broader health and wellness destination. This curation is backed by expanding selection; as of the third quarter of 2025, Grove Collaborative had expanded its third-party product assortment by 50% year-over-year. This expansion includes strategic acquisitions like Grab Green and 8Greens. The percentage of owned brand assortment meeting Grove Collaborative's Beyond Plastic standard reached 81% in 2024, up from 79% in 2023. Revenue derived from these qualifying products accounted for 68% of total revenue in 2024.

Convenience is delivered through a subscription model supporting recurring needs. As of March 31, 2025, the company reported 678,000 Direct to Consumer (DTC) Active Customers. The DTC Net Revenue Per Order for the first quarter of 2025 was $66.49.

Transparency builds trust, especially around health concerns. A national survey revealed that 90% of Americans are concerned about microplastics in their bodies and their impact on personal health, and 89% are concerned about the impact on the general environment. This deep concern underscores the value of Grove Collaborative Holdings, Inc.'s focus on non-toxic and planet-friendly options as a differentiator against mass-market retailers like Amazon.

Here are some key operational and financial figures reflecting the business as of the first half of 2025:

The company is focused on building a platform defined by trust and rigorous standards.

• DTC Total Orders in Q1 2025: 622,000.
• Q1 2025 DTC Net Revenue Per Order: $66.49.
• Gross Margin in Q2 2025: 55.4%.
• Total plastic recovered since 2020: over 17.2 million pounds.
• Full-Year 2025 Revenue Guidance: $172.5 million to $175 million.

This differentiated offering includes embedding educational content, like healthy home guides, into the customer experience.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Customer Relationships

You're looking at how Grove Collaborative Holdings, Inc. keeps its customers engaged and spending, especially after a major tech overhaul. The focus is clearly on making the recurring relationship stickier, which is key when active customer counts are shrinking.

Automated subscription management via Ordergroove was a core part of the technology replatforming announced in late 2024, with the migration expected to complete in the first quarter of 2025. This move away from the homegrown platform is specifically aimed at extending customer lifetime value by unlocking the ability to experiment with new subscriber experiences and improve ease of order management. The goal is to build recurring relationships through enhanced optional subscriber experiences.

High-touch service is delivered through educational resources. Grove Collaborative continues its investment in embedding educational content, such as its healthy home guides, directly into the customer experience to deliver greater value. The company noted it has reached 5 million customers through its cleaning focus and subscription boxes and is now targeting the remaining 52 million consumers with expanded human and environmental health offerings.

The focus on fixing the core mobile app and subscription experience is evident in the strategic shift announced in Q3 2025. Leadership is prioritizing enhancing e-commerce discovery and the mobile experience to directly improve customer engagement, conversion, and retention. This follows the platform migration that began in March 2025, which the Company estimated negatively impacted first quarter revenue by approximately $2.0 to $3.0 million. The impact of these transitions is reflected in the customer base metrics as of late 2025.

Personalized communication and order management are intended outcomes of the new tech stack, designed to better serve customers and advance the vision for environmental and human health. This is a necessary step to improve order economics and customer retention moving forward.

Here are the latest key customer and order statistics from the third quarter of 2025:

The sequential performance shows some stabilization, which is a positive sign for the customer base health:

• DTC Net Revenue Per Order increased 2.4% sequentially in Q3 2025.
• Q3 2025 revenue decline was only 0.7% sequentially.
• The company expects to return to year-over-year revenue growth in the fourth quarter of 2025.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Channels

You're looking at how Grove Collaborative Holdings, Inc. gets its products into the hands of its customers as of late 2025. The strategy has clearly shifted to double down on digital, making the direct-to-consumer (DTC) experience the absolute core of the business.

Direct-to-Consumer (DTC) E-commerce platform (Grove.com)

The primary channel remains the Grove.com e-commerce platform. This is where the company is focusing its resources for sustainable, profitable growth, especially after the technology migration to Shopify. The focus is on rebuilding the customer experience following friction from that transition. For the third quarter ended September 30, 2025, the DTC channel drove the vast majority of the business.

Here's a look at the key DTC performance indicators from the latest reported quarter:

The company is actively managing its customer base, which is smaller due to lower advertising investment in prior years. Still, the Net Revenue Per Order shows some resilience, hitting $66.76 in Q3 2025.

Dedicated Mobile App (re-platformed with Tapcart)

Grove Collaborative has made significant investments in its mobile experience, re-platforming its dedicated mobile app using Tapcart to run on its new Shopify infrastructure. Management explicitly stated they sharpened their focus on fixing the core customer experience, especially the mobile app, subscription management, and payments, as these areas weighed on Q3 2025 results. The goal of this tech stack overhaul is to deliver a top-notch consumer experience while lowering the maintenance cost compared to their homegrown system.

The focus here is on driving loyalty and lifetime value through a better, more reliable app experience. The company is leaning into its subscription service, which is now powered by Ordergroove, to ensure recurring revenue streams.

Organic social media and content marketing to build trust and tell the mission story

While the company has pulled back on overall advertising spend to protect liquidity and profitability, organic channels remain vital for building the necessary emotional connection and loyalty. The mission story-being the world's first plastic neutral retailer and a certified B Corporation-is central to this content strategy. The company is expanding its third-party assortment, which requires content to vet and explain the standards of those new products to maintain customer trust.

For Q3 2025, advertising investment was reported at $3.2 million, an 11.8% increase year-over-year, suggesting a more targeted approach to paid media, which complements the organic content efforts. This spend is intended to restore growth in the coming quarters.

• Focus on merchandising and product selection differentiation.
• Emphasize rigorous standards for clean and sustainable products.
• Use content to educate on environmental and human impact of consumption.

Select physical retail presence (e.g., Target)

The strategic direction for Grove Collaborative Holdings, Inc. as of late 2025 is a decisive pivot away from physical retail. In a late 2024 announcement, the company stated it would exit partnerships with brick-and-mortar stores, including Target, where it first launched in 2021. The wholesale channel, which included Target, constituted less than 4% of Grove Collaborative's business and was described as being "consistently unprofitable."

The current channel strategy prioritizes the DTC online platform and mobile app, viewing the physical channel as a drag on profitability. Any remaining physical presence would likely be limited to selling off existing inventory through concluded contracts, making it a diminishing, non-core channel for customer acquisition in the current model.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Customer Segments

You're looking at the core people Grove Collaborative Holdings, Inc. (GROV) serves as of late 2025. The focus remains sharp on consumers prioritizing environmental and personal health impacts in their purchasing decisions.

The primary group is the Conscientious Consumers, those actively seeking clean, sustainable, and non-toxic products for their homes and families. This group values the B Corp certification and the plastic-neutral commitment Grove Collaborative has made. Then you have the Subscription-focused households, which are the backbone of the recurring revenue model; these customers value the auto-replenishment convenience for everyday essentials, locking in predictable purchasing behavior.

Here is a breakdown of the key customer characteristics and recent metrics:

• Conscientious Consumers: Actively seeking clean, sustainable, and non-toxic products.
• Subscription-focused households: Value auto-replenishment of everyday essentials.
• Health and Wellness Seekers: Expanding target beyond cleaning to VMS, baby, and beauty.
• Active DTC Customers: A base of 660,000 customers as of Q3 2025.

The segment of Health and Wellness Seekers is where Grove Collaborative Holdings, Inc. is pushing for significant future growth, moving beyond its initial cleaning product strength. This segment is being targeted with an expanded assortment that includes vitamins, minerals, and supplements (VMS), baby care items, and beauty products. The company noted it has reached 5 million customers through its cleaning focus and subscription boxes, now aiming to capture more of the broader market with these expanded offerings.

To give you a clearer picture of the scale and recent activity within this customer base, look at these key operational numbers from the third quarter of 2025:

The focus on these segments is directly tied to the company's strategic shift. For instance, the expansion into categories like clean beauty and pantry items directly addresses the needs of the Health and Wellness Seekers. The platform migration to Shopify was intended to better serve the existing base of 660,000 active customers by enhancing personalization, which is critical for retaining subscription-focused households.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Cost Structure

You're looking at the core expenses Grove Collaborative Holdings, Inc. (GROV) is managing as it rightsizes its operations for profitability. The cost structure reflects a shift toward efficiency, especially following the recent e-commerce platform migration.

Fulfillment and shipping costs are a key area of focus, though specific 2025 dollar amounts aren't explicitly broken out in the latest reports. What is clear is the commitment to their mission: every order meets strict ingredient standards and is carbon neutral. The company has previously focused on optimizing its fulfillment network, including using a data analytics platform to reduce shipping errors, which previously cost more than 15% over rate cards.

Cost of Goods Sold (COGS) is managed through a focus on product mix and promotional discipline. For the third quarter of 2025, Grove Collaborative Holdings, Inc. achieved a Gross Margin of 53.3%. Based on the reported Q3 2025 revenue of $43.7 million, this implies a Cost of Goods Sold of approximately $20.41 million for the quarter ($43.7 million (1 - 0.533)). This margin improvement, up 30 basis points year-over-year in Q3 2025, was attributed to better promotional efficiency and a more favorable product mix.

Selling, General, and Administrative (SG&A) expenses are actively being right-sized. For the second quarter of 2025, the reported SG&A expense was $23 million, representing a 15.4% decrease year-over-year, driven by lower stock-based compensation and broader cost-saving initiatives. More recently, total Operating Expenses for Q3 2025 were $26.1 million, a significant 19.5% decline compared to $32.3 million in the prior year, reflecting ongoing cost optimization. The company executed a headcount reduction in November 2025 expected to save approximately $5 million annually.

Technology and platform maintenance costs are tied to the ongoing transition to a new tech stack, specifically migrating to Shopify. In Q2 2025, Product Development expense, which includes technology organization costs, was $2.2 million, a 59.4% year-over-year decline, reflecting a decision to streamline the technology organization following the platform migration.

Customer acquisition costs (CAC) are managed through disciplined advertising spend as the company rebuilds its top-line trajectory. The advertising investment for the second quarter of 2025 was $2.7 million, an 11.6% increase year-over-year, as the company made a strategic decision to maintain investment in customer acquisition.

Here's a look at the key expense and efficiency metrics we have for 2025:

The cost structure improvements are visible in the margin expansion and expense reduction efforts:

• Annualized savings expected from November 2025 headcount reduction: $5 million.
• Q3 2025 Operating Expenses decreased by 19.5% year-over-year.
• Q2 2025 SG&A expense decreased by 15.4% year-over-year.
• Q2 2025 Product Development expense declined by 59.4% year-over-year.
• The company is focused on efficient variable costs per order and low-cost shipping as part of its streamlined operations.

Finance: draft 13-week cash view by Friday.

Grove Collaborative Holdings, Inc. (GROV) - Canvas Business Model: Revenue Streams

Grove Collaborative Holdings, Inc. (GROV) generates revenue primarily through its Direct-to-Consumer (DTC) channel, offering a curated selection of home, personal care, and wellness products. The company has been leaning into expanding its assortment beyond its initial cleaning focus, showing encouraging early growth in categories like clean beauty, personal care, pantry, wellness, and baby products.

The subscription component is definitely the most important stream for Grove Collaborative Holdings, Inc. (GROV), as recurring orders form the backbone of their customer value proposition. The recurring nature of the business is evident in the customer base metrics reported for the third quarter of 2025. The company's focus on fixing the core customer experience, especially subscription management, is directly tied to stabilizing this critical revenue source.

Sales of high-margin Owned Brands, such as Grove Co., contribute to the overall revenue mix and support margin expansion efforts. The Gross Margin for the third quarter of 2025 reached 53.3%, an improvement that management attributed in part to better promotional strategies resulting in reduced discounting activity.

Here's a quick look at the key performance indicators from the third quarter of 2025 that underpin these revenue streams:

Grove Collaborative Holdings, Inc. (GROV) is projecting its financial performance for the full year 2025 to land within a specific range. Full-year 2025 revenue guidance is between $172.5 million and $175 million.

The efficiency of the DTC channel is measured by the value captured per transaction. The Average DTC Net Revenue Per Order of $66.76 was reported in Q3 2025.

• Direct-to-Consumer (DTC) sales of curated home, personal care, and wellness products.
• Subscription revenue from recurring orders, the defintely most important stream.
• Sales of high-margin Owned Brands (e.g., Grove Co.).
• Full-year 2025 revenue guidance is between $172.5 million and $175 million.
• Average DTC Net Revenue Per Order of $66.76 in Q3 2025.