30 Years of booming pet retail

Disruption in pet retail

One such topic is pet retail. We can safely say that, in 30 years time, the pet retail landscape will have changed dramatically from what it is today. Disruption is about to hit us.

Mom and pop stores

Up till the eighties, pet stores were, for the most part, mom and pop stores. Especially in Europe, where only a few stores had affiliate ones. The year 1979 boasted the opening of the first chain of pet stores in Europe: Kolle Zoo. In the US, the early nineties saw the advent of chains such as Petsmart and Petco. By the mid-nineties, Petsmart was the biggest chain in the world, with over 300 shops. Today, they have over 1,500 stores! 

A fast grower in Europe has been German-based Fressnapf. Having opened its first shop in 1990, it now has over 1,400 stores in twelve European countries.
Operating largely as franchise, Fressnapf has inspired other successful pet chains. With the advent and growth of chain stores, mom and pap stores have become extremely rare.

5 ways in which franchise chains have impacted pet retail

The growth of large franchise chains has resulted in new dynamics calling for new know-how and services. The five most impacting of these are:

• The need for international and national logistic systems to replenish stores.
• Standardisation of services, pricing, marketing and bookkeeping, to name but a few.
• Mandatory training of employees to ensure franchisee’s service levels are adhered to.
• Introduction of private labels by franchisees. 
• Launching of customer loyalty systems schemes. 

As the pet market continues to grow, the outlook for pet retail chains appears to be positive in all ways. Yet, there are a number of disruptive developments that are already being felt and that are set to bring some daunting challenges.

Future of pet retail in a disruptive era

Now that the millennials are defining the way we do our shopping, online sales are booming. The impact of online on brick and mortar retail is being felt inall shopping streets and malls. Retailers are being forced to embrace an omni-channel strategy, in order to meet customer requirements. Logistics and warehousing are facing new challenges as first next-day and now even same-day delivery has become part of the game.

With the convenience of online, the modern consumer is looking for experience as reason to take the effort to go to a shop.

In order to be able to meet customer expectations, existing store concepts are in urgent need of a total re-haul.

In pet retail, this could mean bringing grooming and veterinary services into the store. Combining convenience and experience will provide customers with the added value they are looking for. But, things do not end there. The trend to treat pets as if they were human – ‘That which is good for me is good for my pet’ – will undoubtedly lead to major changes in pet store concepts.

The threat of online platforms

Amazon recently announced that it has the ambition to disrupt the pet industry. In 2018, it aims to achieve sales of $8.2 billion (€6.7 billion) in the US: a market share of 16%. The company is bound to also want to do the same in Europe. Especially now that Amazon is moving beyond being merely a transactional site, to becoming an information resource (and build relationships with customers and pet owners) traditional retailers are warned! In the meantime, Chewy in the US and Zooplus in Europe are having their own disruptive online influence.

In Asia, Alibaba, JD.com and many other big Chinese online platforms are making a direct leap forward. On a continent without any pet retail tradition, online rules!