Brick-and-Mortar Retailers Possess Advantages Over Online Competitors

Listen to this article

Over the course of 2020, demand for pet adoptions skyrocketed in response to the stay-at-home orders, and overall pet revenue has grown 63 percent since the COVID-19 pandemic began. While these signs point to a seemingly lucrative industry, increasing competition is making it increasingly difficult for independent pet retailers to maintain their customer base.

Undoubtedly, one of the biggest challenges for pet specialty stores will be competing with the growing number of online pet retailers and the convenience they offer their customers. Even though the majority of purchases are still made offline, ecommerce made up 13 percent of the category in 2018, and that number is forecasted to jump to 25 percent of the total market by next year.

While pet retailers of all sizes are poised to capitalize on increased demand, marketing will need to play a critical role in 2021 as foot traffic continues to rise. More specifically, it will be important to focus on customer acquisition, differentiation and re-engaging existing customers as they establish new routines and adjust to a post-pandemic world.

Let’s first start with the audience you’re addressing. It might be surprising to find out that Millennials make up the majority of pet owners, followed by Gen X then Baby Boomers. Understanding the way Millennials communicate and interact with brands will help pet retailers develop far more effective marketing strategies.

For example, while Millennials tend to be more engaged on social media and more tech savvy overall, they also prefer finding new products in stores versus online, which means that physical retail is not dead for this generation by any means. Being able to meet Millennials where they’re already engaging can make all the difference in your competitive advantage.

Additionally, part of understanding your target audience is also understanding the value they see in your competitors. In this case, personalization, convenience and competitive pricing are the top motivating factors that bring shoppers to online pet suppliers. So let’s talk about ways that brick-and-mortar pet stores can create their own strategies to offer similar value propositions.

One of the most immediate advantages that ecommerce pet retailers have over brick-and-mortar stores is their ability to capture customer data before, during and after the transaction. Building their first-party database provides them the opportunity to not only learn about their customers—pets, food preferences, schedule and so on—but also to remarket to them with more personalized messaging.

To achieve comparable outcomes, physical pet retailers can consider loyalty programs, guest info capture at point of sale or even WiFi-based data collection to develop their customer lists. Once a customer provides their email address or contact information, retailers can use a combination of marketing and technology to create customer profiles for remarketing.

For example, knowing that a customer exclusively buys cat products or a specific brand of cat food means you can leverage relevant promotions, sales or new products to re-engage and bring them back into the store. While personalization may be difficult to achieve at the in-store level, there are ways that retailers can translate some of the perks of the online shopping experience into their physical location.

Aside from price shopping, one of the major elements that shoppers appreciate online is the ability to read reviews from other customers who have tried those products. At the store level, creating custom signage that points to “best sellers,” “highest rated” or “back in stock” can provide subtle endorsement cues for your shoppers and maybe even an opportunity for floor associates to strike up a meaningful conversation.

Beyond typical sales and promotional callouts, signage can also be a great way to show off your expertise with common Q&As, giving customers easy access to more information via a QR code, or recommendations that are useful for your customers (e.g. “not recommended for dogs over 50 pounds”).

In fact, nearly 60 percent of shoppers are already using their mobile devices to look up product information and prices while in physical stores, so enhancing their experience makes you an organic part of their existing process in a way you can get credit for.

In reality, shopping online versus offline is not an either/or proposition for consumers. Considering that 73 percent of customers engage with multiple channels prior to purchasing or walking into a store, it would be more accurate to say that online and offline are two paths on the same converging customer journey. However, there are some advantages to the in-person shopping experience that have yet to be replicated online.

Many customers shopping within physical retail stores look to store associates for knowledgeable feedback and guidance, which can often be a differentiating factor between independent versus big-box retailers. This is a key strategy to tap into because not only do in-person customers have a tendency to spend more overall than online shoppers, they’re also more likely to make impulse purchases.

While there are some obvious benefits to shopping online, most of those revolve around convenience in terms of price comparisons, personalization, consumer reviews and shipping. If brick-and-mortar pet stores can achieve a solid understanding of their customers, then they can start to devise strategies to supplement the offline shopping experience with custom signage, mobile cues and a trusted person-to-person relationship that cannot be replaced.

As foot traffic trends continue to increase into 2021, it will be vital for physical pet retailers to devise new marketing strategies to both recruit new customers and retain existing customers, and the best way to do that is to know your customers inside and out. Investing in marketing solutions to build, maintain and market against a first-party database will be the key to success in 2021 and beyond.

Megan Wintersteen is the vice president of marketing at Zenreach. She has more than 12 years of experience in marketing and digital strategy and believes in a user-first approach above all else. Her client portfolio includes Bowlero Corp, DICK’S Sporting Goods, Google, Verizon and Chiquita, among many others. Megan completed executive education coursework at The Wharton School, her Masters in Advertising from University of Texas at Austin and her undergraduate degree from Salisbury University.