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Pet Food Market Trends
on June 8, 2016

The success of large pet store chains

PetSmart and Petco have consistently gained among pet product shoppers.

Combined sales of large pet store chains PetSmart (including Canadian revenues) and Petco closed in on US$12 billion in 2015. The two companies share a number of similarities: their targeting of pet parents, their dual focus on national (and especially natural) brands and private labels, their emphasis on higher-margin products and services, and their leading e-commerce websites. As the dominant pet specialty chains, PetSmart and Petco account for nearly one-fifth of pet food product sales in the US—equivalent to the overall supermarket channel share (19%) and only somewhat behind the discount store channel share (23%) dominated by Walmart and Target (see Figure 1). 

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PetSmart and Petco together hold nearly one-fifth of US retail pet food sales, via the dominant “pet specialty chain” channel.

In the face of competition from both pet superstores and discount-driven Walmart, supermarkets are fighting to retain their share of the pet market, increasing the size and scope of their pet care departments, sponsoring pet contests, running promotions with animal rescue groups and filling pet prescriptions at stores with pharmacies to help lure pet owners into the store. Store-brand pet foods also play a key role, with progressive supermarket retailers jumping on the latest pet food trends. They are also using their online presence to build interest in their pet departments, featuring pet-oriented websites and blogs and using pet-related events to connect with shoppers.

With over 5,000 retail units in the US, Walmart would be a formidable pet market competitor simply by virtue of its…

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