When asked to give buzzwords to describe trends in the petfood and treat market, many people—regardless if they are industry experts or pet parents—would answer with words found on many petfood packages: natural, organic, corn-free and human-grade. But perhaps the biggest trend is not what list of ingredients pets are getting from their owners, but where those pet owners are getting those popular niche food and treats. Much like consumers are going online to find electronics, books and jewelry, passionate pet owners are finding online retailers to be far more accommodating than the local pet store, often offering a much wider selection of high quality items than smaller, mom-and-pop retailers provide.

Although the sluggish economy has been a mitigating short-term factor, relative to in-store retail sales, Internet sales have been doing well, including in the case of pet supplies, according to the Packaged Facts' report Pet Food in the US, 9th Edition. According to Forrester Research, online retail sales of pet supplies are expected to grow 76% from 2010 to 2014, from US$2.1 billion to US$3.7 billion, posting steady double-digit annual increases and significantly outpacing almost all other Internet categories. Helping to drive sales on the pet market side is the trend whereby more smaller marketers and retailers are turning to the Internet as a sales medium, as well as the above average (and still increasing) likelihood of pet owners to shop via Internet and rely on it for information, says Packaged Facts.

The Internet is especially well-suited as a sales venue for “info-centric” health products like natural/organic and health-related products. This includes petfoods with holistic claims, due to the medium's ability to communicate product benefits and detailed product information, both through product and e-tailer websites and via chat groups, blogs, email and social media. Rather than offering direct sales online, most petfood marketers still find that selling through a third-party website is a more convenient and cost-effective option. The two largest petfood and supplies e-tailers are Petsmart.com and Petco.com, with other leading pet-specific e-tailers including PetFlow.com; PetFoodDirect.com, PetFoodExpress.com, PetSupermarket.com, PetlandDiscounts.com and PetsnMore.com. There are also many third-party e-tailers specializing in natural, organic and holistic petfood products, including EarthlyPets.com, AllAmericanPet.net, PremierPetFoods.com and SitStay.com.

Trailblazers like Smartpak Canine, an animal health focused catalog and web retailer, launched the Proportions Whole Food Nutrition Program in 2010. The program allows dog owners to create a customized meal online and have the food delivered right to their door on a monthly basis. Another sophisticated direct marketer is Drs. Foster & Smith, whose many high-quality private-label products are sold alongside premium brands from other marketers on the company’s website as well as via catalog. Ranking 100 on Internet Retailer’s Top 500 list, the marketer redesigned its website in 2009 to focus on the “Doctor” aspect of Drs. Foster & Smith, highlighting the fact that co-CEOs Race Foster and Marty Smith are both veterinarians. The site also includes a link to Drs. Foster & Smith’s new pet blog and The Doctors’ Information Center, which lists pet care videos, articles and other related information. In addition, following in the path of human catalog marketers, in 2008 Drs. Foster & Smith teamed up with Target to offer its products via a bricks-and-mortar retail channel for the first time, according to Packaged Facts.

Overall, these online pet retailers are more sophisticated in their web design and ecommerce, reaching their target audience via website usability, SEO, paid search and word of mouth via blogging and discussion boards. These websites are still in the minority of a largely fragmented pet marketplace even in 2011, but this gives a savvy pet marketer an opportunity to stand out from the crowd.

Video: Starting an online pet business

Watch video of Packaged Facts' senior market analyst, David Lummis at the Petailing Leadership Conference in Las Vegas, Nevada, USA, describing his thoughts about starting an ecommerce pet business in a down economy.