Video Transcript
1. Big box store growth in 2020
Thanks for joining me as we discuss the seven most dangerous trends facing independent pet stores today. My name is Keegan Edwards with New Media Retailer. We’re going to be talking about the most important trends to pay attention to if you are an independent pet store owner. These things are trending in a direction where they’re creating new challenges for the independent pet store channel. So first and foremost, Chewy is gaining a lot of customers, and independent pet stores don’t have a plan to compete online with this threat. So chewy has almost 18 million customers at this point. And in a three-month period in 2020, they added 1.6 million new customers. Now to top that all off, all of 2020 chewy grew quarter by quarter by almost 50% each quarter. So that’s in total revenue. So Chewy’s gaining a lot of customers, and they’re doing it by, you know, as an e-commerce company, taking customers right out of local markets, taking them right from their independent pet stores in pendant feed and farm stores, and plucking them off and taking the low-risk customers and getting them onto their recurring revenue or repeat order system.
2. Keeping up with delivery demands
So it’s a really, really challenging situation. That’s disrupting the independent pet stores’ ability to keep and retain their customers in their local markets. The other thing that’s going on is customers are increasingly looking for delivery. So they’ve gotten really used to delivery from food restaurants and now even retail stores. So studies have found that 60% of consumers have ordered something for delivery from a retail store. So the big box stores like Petco and PetSmart are creating repeat delivery services, and companies like PetSmart are partnering with door dash to do delivery and actually offer a PetSmart is offering free same-day delivery using their door dash partnership. So you can order from any PetSmart store and get free same-day delivery of pet products and pet food. That’s a really, really important trend to be aware of and to start to prepare for.
3. Improvement in services
Now, the other thing that’s challenging is Walmart, Petco, and PetSmart are improving their pet services and stealing foot traffic from independents. So Walmart has partnered with Rover, which is a dog-walking dog boarding app, and they’re increasing their in-store service offering. Petsmart has, and Petco has mobile apps, Petco in particular, a mobile app. That’s really easy to schedule boarding, grooming, visits, all of that. So they recognize that services were a weak area, and they’re working to improve their pet services, parts of their business to help increase store traffic.
4. Ordering right from Google
The other really big issue is that pet stores are invisible in Google again, and they don’t even realize it. So at one point in time, it became obvious that Google is really important, and stores start paying attention to how to rank in the organic results. And then a new thing came along. That little map showed up, and people said, okay, I need to make sure my business shows up on the map, but now there’s something even newer.
And you can see right here on my screen that Petco and PetSmart are taking advantage of it. But when you search for pet food and Google, you’re going to see places that offer curbside pickup and show that they have that product available in their store. And this is what consumers are using. It usually shows up at the top or near the top of the results. It’s an actual catalog in Google that shows the customer where they can pick up whether it’s a dog food search, pet food, whether it’s toys, it shows them which local stores have that product and have it available. Now, as you can see from the results, Petco and PetSmart have figured this out, and they’re using it because they know that that can draw people right to their store. This is more attractive results than the maps or just the website listings. So they’re using it really effectively to get people to drive to their stores instead of yours.
So meanwhile, the independent pet stores are getting pushed further down the results to where people have to scroll down to the maps or down to the organic listings before they even get seen. The reality is people have already clicked and said, Oh, there’s that taste of the wild product I wanted. I see it right here. I see it’s available at Petco. I am going to go buy it there.
5. Competition created by advancing technology
The future of retail services is also happening now. Chewy launched a telehealth service for veterinary services. So it used to be that a consumer would have to take their dog to the vet. And then that local vet might recommend your pet store to pick up either medicine or might be to pick up a special type of food that they recommend right now. Chewy is saying, we don’t want that to happen. So they launched telehealth for pets. That’s gaining in popularity where people can FaceTime with their Chewy vets, and Chewy gets the revenue for the vet visit. And then they can just recommend buying those products right from chewy.
At the same time, grooming has always been a big foot traffic driver for stores, unfortunately, the mobile grooming market. So people in their vans or with mobile grooming trucks that market’s growing faster than the overall grooming market, which means that it’s trending towards people, favoring mobile grooming services over going into a store for grooming services for their pet.
6. Up-to-date product catalogs
The other thing that’s happening is customers are visiting stores. And when they know that the product is available and too many stores don’t have up-to-date online product catalogs. So customers are 80% more likely to visit a store if they know that what they want is there, which is part of the reason that Google shopping piece is so valuable is that people know that the product’s there. So they’re going to those Petcos and PetSmart’s, so people are 80% more likely to go if they know that what they want is there in the store. And we also found that 70% of people, at least some of the time, are going to look online before they even consider going. So they’re going to look online at a store’s website to see if the product’s available before they even consider going. Now, if they see that it’s there, they become 80% more likely to actually come to your store. So the up-to-date product catalog becomes extremely important.
7. Consumers want to shop after hours
Finally, people are shopping when the store is closed, which we found over half of us consumers shop online or plan their shopping kind of proves catalogs at night. And that’s in the evening or late into the evening. So, unfortunately, that’s when many of the independent pet stores are closed. So they can’t call them, ask a question. They can’t, you know, just drive to the store. So consumers are searching online and shopping online over half of us consumers in the evening or late evening when the store is closed. So how does the store still capture those customers? Well, having a good online product catalog, curbside delivery, next-day delivery orders for shipping. That’s how you still capture the customer, but too many pet stores don’t have an up-to-date online product catalog to offers or convey this information.
Overcoming these challenges
So we are New Media Retailer where helping retail businesses succeed in this environment. So retail, business, and technology are changing fast. A lot of people are recognizing the challenges we see opportunities. So with all of these trends that are happening, we’re actually charting the path to the future for independent retailers, helping them overcome these challenges and turning them into advantages through dedicated strategic, online presence, and digital marketing campaigns that help drive more foot traffic to your store and convert leads for your business. Thanks for joining me for this video, the seven most dangerous trends are facing independent pet stores today.