57 July 2017 Pet Product News International
BY DAVID LUMMIS
For several years, pet market observers, including this one, have been touting the internet as the retail channel to watch, and as of right now, those e-commerce stars seem to be fully aligning.
During 2016, online sales accounted for 9 percent of the $47.8 billion U.S. market for pet products, around $4.3 billion, and that share
is e;pected to ;ump to ;; percent (;;.; billion) during ;;;;. ;e;ect-ing both the proclivities of younger shoppers who grew up tapping
a keyboard and the advancement of the digital age across most facets
of American life, the number of pet owners clicking “Add to Cart”
is multiplying. According to Packaged Facts’ February/March 2017
National Pet Owner Survey, pet product shoppers are increasingly
e-commerce prone, with 40 percent agreeing that they shop online
more than they used to, re;ecting a steady upswing from ;; percent in
2012. Overall, as of 2017, 40 percent of pet owners purchase pet products online, compared with 33 percent in 2014. They are also doing so
more often. The 35 percent who bought a pet product online in the
last week as of 2017 is more than double the 2012 level of 16 percent.
Where are they doing all of this internet shopping? Amazon tops
the 2017 list, attracting 54 percent of those who purchased pet products online, followed by PetSmart ( 30 percent), Walmart ( 29 percent)
and Petco ( 27 percent). Chewy.com comes in at 18 percent, so its recent
acquisition by PetSmart likely bumps PetSmart into second place.
Retailers are doing their part as well, with pure-play online and
brick-and-mortar players increasingly intermingling:
; In April, in the largest e;commerce acquisition in history, ;etSmart
acquired Chewy.com for $3.35 billion, surpassing the $3.3 billion that
Walmart paid for Jet.com in 2016. Chewy.com has been around only
since 2011, earned $900 million in 2016, and is expected to ring up as
much as $2 billion in 2017.
; ;ike ;etSmart, ;etco seems to see the internet as where it;s at.
According to ;;;;data, both of its e;commerce properties ;ourished
in 2016, with DrsFosterSmith.com up 106 percent and Petco.com up
39 percent. In April, Petco acquired PetCoach, which connects pet
owners with veterinary professionals online and provides another
digital avenue for pet product promotion.
; Through ; et.com, ;almart is reportedly focusing even more aggressively on selling pet food online.
With the premiumization and humanization trends having arguably peaked in their ability to spur major growth, and with PetSmart
and Petco seemingly taking much of the hit, the pendulum might be
swinging back toward the mass channels that have, by now, largely
co-opted those trends, along with neighborhood pet shops. Regardless, when it comes to convenience and selection, the internet wins
hands down over just about any brick-and-mortar contender, and as
e-tailers master the art of affordably delivering bulky goods, the price
differential is closing as well. Any major pet retailer or marketer not
on the internet wagon in a big way is likely to see it roll by.
David Lummis is the lead pet-market analyst for Packaged Facts, a division
of MarketResearch.com. The statistics cited here are drawn primarily from
the latest edition of Packaged Facts’ annual report, U.S. Pet Market Outlook, 2017-2018. For more information, visit packagedfacts.com.
Clicking on Pet
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Please help HABRI tell this story. You can directly contribute to
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today, please spread the word: If you want to be healthy, eat your
fruits and veggies, get enough exercise and get a pet!
Steven Feldman is executive director of the Human Animal Bond Research Institute (HABRI). HABRI is working to establish, through science and advocacy, the vital role of companion animals in the health and well-being of individuals, families and communities. To learn more about HABRI, visit habri.org.