Interview: How is Dutch pet retailer Pets Place doing?

Pets Place currently has 175 stores in the Netherlands and opens approximately 12 new shops each year – its gameplan being to close smaller locations and open larger ones.

By continuing to refine this approach – with an ultimate goal of 230 stores – it hopes to keep expanding its coverage across the region.

Managing Director Ard Malenstein comes from a family with a background in wholesale and retail, and has now been in the pet industry for well over 25 years.

He tells PETS international about the company’s plans to personalize its services for each individual consumer and explains how he is setting his sights on one of the largest pet markets in Europe.

Where does Pets Place fit into the regional pet retailing ecosystem?

We are an omnichannel retailer, very focused on digital and consumer engagement. We position ourselves at the upper end of the market, targeting pet lovers who value advice on keeping their pets healthy.

How are data and technology supporting your strategy?

Our omnichannel strategy begins with understanding our customers: who they are, where they are, their age, and what type of pet they have. The challenge was to consolidate this information into a data warehouse for quick and efficient use by pet professionals.

Traditionally, promotions were uniform, but we aim to shift to hyper-personalization, delivering the right information at the right time.

We now have a comprehensive customer view and are training our marketing team to use artificial intelligence (AI) for hyper-personalization.

Exactly how will the new system work?

Hyper-personalization will involve tailoring content based on these detailed customer profiles. For example, we categorize dogs into small, medium and large breeds, and even further by specific breeds.

Automating this process is crucial if we want to ensure timely and relevant information. Additionally, we will focus on quality content, including videos, and collaborate with brands to provide that relevant content directly to consumers.

When do you expect this hyper-personalization to be a reality?

We plan to begin implementing it in the last quarter of this year. Our goal is to achieve over 1 million opt-ins within 3 years.

What can you tell us about the business online versus offline?

Currently, our sales split is about 75% offline and 25% online – where we have over 60,000 SKUs available for next-day delivery.

What we’re seeing is that many consumers shop in both online and offline channels. The key point is that we adapt to what the customer wants, which is – increasingly – convenience.

Which expenditure patterns do you see among your customers?

Overall, we are experiencing growth in both the number of customers and the average ticket size. Larger stores tend to have higher spend levels due to a wider selection.

Online spending is also higher because customers often purchase larger items.

Is there a difference in category performance?

Non-food categories are growing because we are allocating more space to them on the shelves. The dog and cat product categories are expanding rapidly, especially in larger stores.

Rodents and birds have been the hardest-hit categories in the past 2 years. Frozen food sales are growing by 20-30% year-on-year.

Are alternative ingredients such as insects or cultured meat performing well?

While we have a limited product range, insect pet food is growing and it currently accounts for 2% of our total sales.

There is a broader potential audience if we can communicate the benefits well. In larger stores, this category is given roughly 1 meter of shelf space.

Fressnapf and Maxi Zoo recently entered the Dutch market after acquiring Jumper. Is this posing any challenges to your operations?

Jumper was already a competitor, but it focused more on discount and mainstream consumers.

Currently, Jumper’s turnover is around €70 million ($78M), while we expect to reach €350 million ($391M) this year. The gap makes it challenging for competitors to match our scale and growth.

How do you see in-store services developing?

We currently offer dog washing and we have 6 stores with veterinary services.

This month we’re adding a new vet clinic, and we plan to expand this offering. Our aim is to introduce health points in all stores within 2 years, integrating digital tools to provide health checks and consultations.

And the next steps in your expansion plans?

We plan to introduce our full assortment in Germany online and evaluate customer preferences before opening physical stores there. Our initial focus is on understanding the market and finding the right locations for expansion.

You will enter a market with quite strong players…

Germany indeed presents challenges with its strong online players, but we have confidence because we’re doing well in the Netherlands, even against solid competitors.

Our focus is on building a successful brand as a retailer offering a broad assortment, which includes many well-known branded products rather than private labels. This strategy resonates with online consumers.

Do you have your eye on the big German cities?

We will look at both large cities and strategic locations nationwide. Our goal is to achieve national coverage with a strong focus on quality and a broad assortment.

We will definitely target major cities such as Berlin and Hamburg, focusing on high-quality locations.