Nonfoods Talk: Pet Polarization
Grocery retailers are either “all-in” or backing away from promoting the pet aisle.
What is going on with the pet aisle at supermarkets?
That all depends on the retailer you are talking to. Perhaps more than ever, supermarket retailers are going in two distinct directions with their pet strategies. Some are increasing their assortment of products, especially with pet supplies but also pet food and cat litter, confident that a larger and more diverse department will draw more customers down the aisle and more money into the till.
Others are taking the opposite approach. To be candid, they are simply abandoning all but the most popular items on the food side of the category, downsizing other parts of the segment as they desperately search for more room for the more popular and trendy fresh departments. Pets may be big business, but besides the fast-turning food side there are just too many headaches to deal with when it comes to pet supplies, many say.
Those retailers that are expanding their pet aisle do so because of the perceived opportunity out there in terms of sales and profits. More and more consumers own pets—specifically dogs and cats—and as never before, they are treating these animals as part of their families. That means a burning desire to give their pets the best of everything, all designed to make them more healthy and happy. Remember this equation: a happy pet usually means a happy pet owner, who is usually only to eager too pay more for products that they perceive as better for their animals.
This optimism is opening the doors for new suppliers in the marketplace. On the eve of the annual Global Pet Expo, held in Orlando, Fla. from March 22-24, many of those retailers that are expanding their pet sections say that they are looking for new partners to help propel the pet category forward. The days of one or two suppliers dominating the market are over. Now grocery merchants are looking for unique brands or unique products to win consumers over. There are simply too many options available now for retailers to stick with just a couple of suppliers.
That is great news for the newcomers to the marketplace and potentially bad news to the old favorites, who risk losing valuable real estate to an upstart company. But this battle for shelf space is lighting a fire under the likes of major players such as Nestle Purina, Hills and Iams to become much more aggressive with product innovation and marketing to maintain their position as leaders of the food segment. Unfortunately, the same cannot be said of the leaders on the supplies side of the market where a general malaise and lack of leadership seems to continue to keep these companies from taking the necessary steps to fight off the new competition.
In the end, competition and innovation is good news for retailers and suppliers. The fight for shelf space can only make the category stronger as more research and development leads to product introductions that make sense to consumers. It also creates more excitement in an aisle that most definitely needs some energy pumped in.
The Global Pet Show is one of two major pet events (SuperZoo in Las Vegas, held in the summer, is the other) where retailers can see what is hot in the pet category. But there is growing talk that there is simply too much duplication in the marketplace and the shows highlight this problem. As one East Coast grocery pet buyer noted, how many different kinds of dog bowls and pet beds can inundate the marketplace and just how often do these types of products turn to convince a retailer to carry an assortment of more than one or two brands?