In May of this year, Amazon launched its own in-house pet brand, Wag, a move which should send a shiver down the spine of every other company operating in the pet care sector. According to Bloomberg, the brand launched with dry dog food, but plans to rapidly expand their selection into other pet care products. Pet food in the United States alone is a $30 billion industry, and reports have indicated that Wag has been a great success so far. If you are making your living in the pet-care industry, what does Amazon’s acquisition of Wag mean to your brand?
Pet food is an ideal product for online sales. Demand is predictable, the food is bulky and heavy, and most pet owners choose a brand and stick with it. Amazon is well aware of this, and their decision to make Wag available only to Amazon Prime subscribers, who have already paid for free, express shipping, gives a hint to how they plan to market Wag. If you already have a Prime subscription, why not try their high-quality, nutritious dry dog food at a heavy discount? If Pugglesworth likes it, why bother going to a crowded supermarket or pet store and lugging a 30 lb. bag home? If you’re already buying from an established brand on Amazon and have fallen in love with the convenience, what will you choose when that option is no longer available with fast, free Prime shipping, or possibly no longer available on Amazon at all? I bet you can guess.
We apologize in advance for comparing you to one of the most controversial and inflammatory figures in the history of the internet, but it fits so perfectly that we can’t help ourselves. Alex Jones had an extremely successful online empire. He peddled his conspiracy theories and vitamins, and millions of people subscribed to his Youtube channel and bought the products he sold. Then one day, the platforms he used to reach his audience either had a crisis of conscience or decided he was hurting their bottom lines. All of a sudden, you couldn’t find him on Facebook, Youtube, Apple, Spotify, Stitcher, Pinterest, Twitter, LinkedIn, MailChimp, or even YouPorn! A niche audience followed him to some dark corners of the internet, but he was essentially removed from the discourse. He had been de-platformed.
Think about your own business. If you are relying heavily on Amazon to reach the customers who buy your pet care products, your business depends on a platform which has every incentive to treat you like Alex Jones. You’re not controversial, but you have become their direct competitor. If (or more likely, when) they decide to stop helping you deliver dog food, leashes, or cat toys to the consumer, do you have a plan in place to make your customers stick with the products they’ve come to trust? If you can’t deliver the same level of convenience Amazon can, you’re primed to lose out. Right now, you’re the gingerbread man crossing a river on the back of a hungry wolf. Don’t you think it’s time to build a life-raft?
PetSmart, one of America’s pet-care sales leaders, took pre-emptive action against Amazon’s aggressive move into the industry by acquiring Chewy.com for $3 billion in 2017, and despite the struggles PetSmart has experienced, Chewy may have doubled in value since the merger according to the Wall Street Journal, with revenues surging by 81% in the first quarter of this year.
If you aren’t able to purchase a large company with a strong customer service and logistics infrastructure already in place, how can you compete with the big boys? For Inspired Pet Nutrition, a family run company that is the UK’s largest independent dry pet food manufacturer, the answer was pairing with Adimo to offer consumers the option of buying directly from them. Their partnership has allowed IPN to market their product with shoppable videos and leading edge add to basket technology, which allows consumers to add the product to their weekly shopping list from 9 leading British retailers. According to NetImperative, IPN found that, of the customers who watched a shoppable video ad, “77% went on to select a retailer and three in five clicked Buy Now.” The magazine reports that, of users who interacted with shoppable content on the brand’s website, “83.4% went on to select a retailer to deliver their selected product.”
As Dan Reeves, IPN’s managing director, reports: “Adimo’s technology provides our customers with… an instant checkout across our video and websites [which] means we can make their day that little bit more straightforward. Our results so far show that this certainly secures the initial sale but also keeps customers coming back time and again.”
If you manufacture a pet-care product, relying on Amazon for sales is like burying your head in the sand and hoping the tide won’t come in. Amazon is a large aggressive company which has already declared its intention to take over this lucrative market. Their sales are already growining by leaps and bounds, and they plan to add a wider range of products soon. It is imperative that you find a way to sell directly to your consumers before Amazon de-platforms you or sends you so far down the search list that your customers can’t find you. Today is the day to explore shoppable marketing and ways to reach your audience without relying on Amazon. Tomorrow is the day to build your own sales platform and market directly to your loyal customers.