Industry leaders tackle AI, healthy eating and sustainability at GlobalPETS Forum in Venice

A need for more data

It’s not just about AI. Businesses must embrace digital transformation. Eli Hasson, founder of PHIL Ventures in Tel Aviv, admitted: “We are facing a problem of insufficient data. We need to determine who our actual customers are.”

Hasson invited pet entrepreneurs to create a digital ecosystem providing pet parents with information, assistance and high performing products. “What we are witnessing out there is connection. Connected devices have evolved, not just the GPS trackers but also lots of different insights, such as pet health and activities. Services are growing, such as pet insurance, which has only 5% market penetration. Food is too generalized – there is a vast space for companies to provide more specialized foods, items and services.”

The retailer perspective

The forum also provided an opportunity to analyze another important topic – the challenges of pet retailing in a post-pandemic world with global headwinds.

Nicolò Galante, CEO of Italian pet retailer Arcaplanet, admitted that the customer’s rising sensitivity to prices needs to be heard by the industry. Galante shared with the audience that his company’s strategy to maintain customer loyalty was keeping some items at a lower price for a year and guaranteeing a 15% continuous discount applied to vet products.

Upselling and cross-selling are also important tactics for facing challenging times. Timo Tervo, CEO of Pet Network International (PNI), described how training a sales team in these techniques could also help to manage price sensitivity.

PNI focuses on changing customer pricing with data analysis, using an AI-based CRM that leads to a much better understanding of customer behavior. “We have categorized our customers into different spending brackets. This is the key, targeting the groups of people we want to bring up to a higher bracket later,” he shared. In addition to the power of data, the company has implemented a substantial expansion plan and launched a new store concept to secure its market position in Eastern Europe.

Modeling smarter shopping

The event hosted a panel discussion to analyze different business models and the future of pet retail.

Frédéric Le Guen, CEO of French pet retailer Animalis, argued for better information as an essential tool to guide customers toward smarter shopping behavior, and as a strategy to maintain loyalty.

Alexander Thelen, co-founder of German pet supplement start-up mammaly, said that consumers paying more attention to prices before purchasing a product can be an opportunity for the industry. “People in the pet supplement category are less price-sensitive, because these are health solutions for a pet. On the other hand, it’s an opportunity for us to grow – and to think about new target markets for entry-level price products.”

According to Marco Hierling, CEO at e-commerce player AlphaPet Ventures, inflation hasn’t changed loyal customers’ purchasing habits, but has made finding new customers challenging: “Customers focusing on good quality and affordable prices is a trend that will continue,” he admitted. The recipe for success is a strong brand and a strong product.

Omnichannel was also a topic of discussion for the panelists. According to Hierling, pet brands must be available where the customer wants to buy their product – online and offline. “That’s why multichannel approaches are the way forward,” he concluded. Le Guen advocates an omnichannel approach to beat the competition. While there is space for everyone, he warned: “Not everyone will survive in the next few years. That’s why it is important that more traditional retailers completely embrace the omnichannel strategy.”

The consumer’s role in sustainability

Once again, sustainability was mentioned in a lot of keynotes.

For Arcaplanet’s Galante, pet businesses need to go as fast as the customer is ready to go. “We are trying to achieve a positive environmental outcome by involving our customers in our social impacts. Rather than doing social good on their behalf, we could have a real social and environmental impact if we guarantee customer participation in sustainability through sustainable consumption,” he proposed.

Arcaplanet’s motto is to “improve social impact for sustainable consumption”, which is why the company has implemented emission measurement and target setting, a lower footprint store concept, commitment to circularity and waste reduction, and the promotion of low-footprint consumption.

The advice Erin Haas from the Pet Sustainability Coalition gave to GPF attendees was that, despite the time-consuming process, it is essential to stay compliant and take a step further to gain competitive advantage. “A strong ESG strategy will set you apart and ensure you’re more able to seek the additional investment you’re looking for,” she said.

Haas also pointed out that corporate sustainability will improve business supply chain resiliency, increase loyalty and trust, strengthen brand image, and decrease reputational risks.

Healthy eating and vet advice

A current trend that was much talked about at the event was pet parents’ interest in healthy food for their furry friends.

Liseth Galvis from Euromonitor pointed out that the rising demand for health products and pet supplements will be one of the most important trends to watch this year when it comes to pet food. Supporting that, Mintel’s Kate Vlietstra reported that nearly 6 out of 10 pet parents aged 16 to 34 are interested in a personalized diet plan for their pets. “For many pet owners, healthy food means fresh food. Frozen, raw, biological food is becoming increasingly relevant.”

Marta Sułkiewicz from Similarweb showed how sales of vitamins and pet supplements increased in the US in 2023. A good example of this rising trend is the fact that a growing number of e-commerce websites selling pet products now offer high-quality, fresh and customized pet food options that are convenient and easy to access for pet parents.

VetFamily’s Chief Operating Officer Michael Thunell highlighted the importance of veterinarians in providing a healthy diet for pets. “Given that 87% of pet parents want nutritional recommendations from their vet, this is a big market opportunity,” he concluded.

The next GlobalPETS Forum will take place in Prague from 22 to 24 January 2025.