Pet online retail in Germany proves resilient

In the first 6 months of 2023, online sales value of pet supplies in Germany was €1.06 billion ($1.15B). This is a decline of 5.8%, compared to the revenue of €1.13 billion ($1.24B) in the same period in 2022. Online sales for the whole of last year accounted for €1.86 million ($2.01M), with the decline in sales revenue becoming apparent in the third and fourth quarter.

In the long term, however, online sales of pet supplies do appear to be resilient despite the current crisis. The market has grown by 51.5% since the outbreak of the pandemic at the beginning of 2020. This compares favorably to other major industries, such as fashion retail, which has seen all the revenue gains from the pandemic wiped out.

Downward trend … or not?

After experiencing high growth during the peak of the pandemic, German online retail is currently in a consolidation phase. This started with a major setback in 2022 – after the war broke out in Ukraine.

For the first time since data collection began, the gross turnover of goods online fell last year, declining by 8.8% to €90.4 billion ($97.6B). And that was just the beginning. For the first half of 2023, accumulated sales online were approximately 13.7% below the comparison value of 2022, indicating that rock bottom has not yet been reached.

That said, it is too early to mourn the loss of online retail, especially when compared to bricks and mortar. While traditional retail has yet to make up for its pandemic losses –according to the Federal Office of Statistics – with revenues still lower than in 2019, overall online retail turnover is up 14.7% for the same period.

Thinking ahead

There is good reason why the pet supply industry is faring better online than other sectors during the current crisis. While most online retailers are now focused on cutting costs and re-evaluating business channels, many pet specialists are massively expanding their investments, preparing to gain further market share once consumer sentiment brightens again.

Taking customers from grocery retail

Pet food in Germany is still primarily sold through traditional grocery retail, with revenue in the channel accounting for 62% of the market, according to the Industrial Association of Pet Care Producers (IVH). But pet supplies are generally considered niche products in this area of retail. The only exception is Germany’s third largest grocery retailer Rewe, which has experimented with specialized pet stores under the brand ZooRoyal.

Online retailers have gratefully filled this gap in the market in recent years, gaining more and more customers with extensive and specialized product offerings via their online shops.

From online seller to care provider

Since the peak of the pandemic, some online retailers now realize that it is no longer sufficient to offer pet owners merely an alternative distribution channel alongside bricks-and-mortar stores. The idea gaining ground is that their best competitive edge is not a wide range of products or fast delivery – it’s data.

Retailers such as Fressnapf have started to demonstrate how that’s done: by linking, for example, a customer account with a wearable device like a GPS tracker for a dog or cat, the pet owner can not only monitor their pet’s movements and activities, but also have round-the-clock in-app access to a veterinarian, who can then see the pet’s latest health data.

An example like this shows the efforts being made to transform traditional sellers of pet food and other pet supplies into data-driven ecosystems for pets.To continue growing in the market, a seller evolves into a ‘care provider’ for all aspects related to their customer’s pet. This helps them to lure customers from supermarkets to their online platforms, and gives them the opportunity to grow despite the negative market trends.

You can find an overview of the German pet industry, including the latest data and trends, here.