IRUK 500

Pets at Home: insights into a strategy that produces 53% growth in online sales

Pets at Home [IRDX RPAT] today reported a 53% leap in ecommerce sales during its latest financial year. At the same time, overall revenues reached £834.2m in the 52 weeks to March 30 2017, up by 7.2% compared with the same period last year. Revenue from product sales reached £716.7m, 2.9% up on last time, while services sales of £117.5m – from grooming or vet services – were 44% up on last time. Pre-tax profits of £95.4m were 3.5% up on last time. Here we take a look at some of the multichannel strategies that have enabled that growth.

Pets at Home is a Top50 retailer in IRUK Top500 research.

Omnichannel strategy

Pets at Home said its omnichannel investment had paid off, with online growth of 53%. Chief executive Ian Kellett said this gave it a unique position as “the only pet business delivering an integrated omnichannel and services offer”. It says it is taking market share in the pet category, where 11% of business was online in 2016. “The convenience of our UK wide store footprint remains.” it said. That is set to increase over the coming year as the retailer works towards a target of 500 stores, from 434 by year end.

Cross-channel ordering

Almost half of online orders, by revenue, were collected in-store. Staff can now use in-store tablets dubbed PetPads to place an online order for something in the extended online range. “This gives store customers easy access to even more of our range and has already delivered over £2m in revenue since its launch at the end of the financial year, which we believe is driving incremental sales,” said Pets at Home in its full-year statement.

Loyalty

During the year the retailer launched a VIP App, which members use to collect points for a nominated charity and which replaces a physical VIP card. During the year cards or virtual cards were swiped alongside transactions involving 68% of revenues. That’s up from 64% a year earlier. Nearly 500,000 members bought both products and a service. Pets at Home says that customers who buy online or in the store but doesn’t use a service spend around £140 a year, contrasted with £180 on products and £200 on services for customers who use either vet or grooming services.

Subscription retailing

VIP members are able to order a monthly flea treatment for their dog or cat through Pets at Home’s first subscription service. “The convenience of this plan has proved very popular with customers, with subscription sales now representing 16% of our total licensed medicine revenues,” it said. The scheme will expand to cover another medicine in coming months.

Mentioned in this piece…

Pets at Home

Pets at Home

IRDX: RPAT

Pets at Home is a British pet supplies retailer that operates 370 stores and an ecommerce site. (more…)

Image credits:
  • InternetRetailing