Amazon has become an aggressive player in the pet food market, raising the sales of dog and cat food on its website each year and now launching its own dog food line. While its moves and dominance represent a competitive threat to brick-and-mortar stores selling pet food, particularly pet stores, its strategy also poses significant competition to other online platforms. That is especially true for ones that specialize in pet products, like Chewy.com.
Can Chewy truly compete with Amazon? Some people believe it offers a more focused experience and better customer service — which is what brick-and-mortar retailers, even Chewy’s megastore owner PetSmart, could claim (well, at least the focused experience part for PetSmart). And of course, Chewy has its own private label pet food line, American Journey. A new report from Gartner L2 suggests that the platform might also be winning the online advertising war against Amazon, though that may be a short-lived advantage.
The report’s title says it all: “Pet Care U.S.: Amazon vs. Chewy.” While there are many other e-commerce sites selling pet food, including those from independent pet specialty retailers along with PetSmart, Petco and similar superstores, Amazon and Chewy have gained the most attention over the past year or two, in addition to the highest market shares.
According to Gartner L2, Chewy currently has the upper hand over Amazon in Google ad searches. The report includes a graphic showing the retailers’ respective visibility “against unbranded terms on Google” as measured by appearances in first-page search results. For text ads, Chewy has 69 percent visibility versus only 13 percent for Amazon. For shopping ads, the disparity is even greater: 76 percent versus 9 percent, respectively. However, when it comes to organic search — the number of appearances on the first page of search results not counting ads — the two retailers are nearly tied, at 38 percent for Amazon and 39 percent for Chewy.
Gartner L2 argues that, “while Chewy fights for relevance in its own category, Amazon has kept pace, promoting seamless shopping experiences by releasing guided selling tools such as a pet profile and a dog food advisor.”
Though I could access only a one-page excerpt of the report, I found several insights and nuggets of advice for pet food and other pet product brands. For example, Gartner L2 cautions that, while the battle is waging between Amazon and Chewy, brands need to “right-size” their digital marketing investments by understanding the evolving role that retailers play.
When it comes to these two specific pet food retailers, that means approaching visibility differently based on the platforms’ relative strengths. In other words, “prioritizing paid and organic search on Amazon and creative merchandising on Chewy,” the excerpt reads. “Brands heavily merchandised throughout the Chewy platform receive the highest share of page views.”
And, perhaps not every e-commerce platform (including these two) is right for your brand and your business strategy. “Defer to retailers that aggressively bid on branded terms and reallocate investments to e-commerce optimization efforts on retailer platforms,” Gartner L2 recommends.
Finally, aside from this report’s focus on the big pet e-commerce retailers, don’t forget that independent pet specialty retailers still have a strong affinity and attraction to pet foods exclusive to their segment of the channel, and that can open or firm up opportunities. For example, by recently acquiring the bankrupt Wild Calling Pet Foods (a favorite among some independent retailers before its bankruptcy), Barkstrong may have cemented a role as a new but important partner to the independent channel, said Mark Kalaygian, publishing director and editor-in-chief of Pet Business magazine.
“Barkstrong has quietly assembled a small stable of brands — including Great Life Petfood and Pioneer Naturals — that have proven to be winners for a number of independent pet retailers but have yet to achieve broad, national distribution,” he wrote. “Now the company, which just entered the pet industry in January, stands poised to realize the full potential of these indy-focused brands at a time when independent retailers are looking for lines that will continue to differentiate them from the big-box pet chains and mass/grocery stores.”
Not to mention from those e-commerce giants.