Five companies control more than half of the $100+ billion U.S. pet industry, which is still growing close to double digits a year. That leaves a $50 billion market open to innovative challengers with compelling brand narratives who know how to quickly establish a firm, profitable niche. And retail media in pet industry search is how they get there.
Retail Media in Pet Industry: The Challenger Brand Playbook
At the center of this opportunity is the emergence of a highly efficient and measurable performance marketing tornado: retail media. Retail media is a friend of all challenger brands who can’t yet afford a 360-degree marketing launch built around brand awareness. Its effectiveness in the pet industry is multiplied by the fact that the best pet shoppers – urban, upscale women – like to shop online, and in the pet category they have two great options in Amazon and Chewy, as well as Walmart Connect.
Why the Full-Funnel Model Doesn’t Fit Retail Media in Pet Industry
That concentration is an edge worth examining, because nearly all of us in consumer brand marketing have subscribed to the step-by-step, full-funnel dogma: first you build awareness, then consideration, then you pray for conversion, and finally brand loyalty, whereby the cycle repeats itself, driven by positive word of mouth from committed evangelists. Except few readily acknowledge that achieving top-funnel awareness is very hard, especially in the incredibly noisy US market, where the typically frenetic consumer gives no more than half a second of consideration to any product that passes by them in a store aisle or a digital ad.
A heated discussion these days is whether or not the booming retail media industry represents a full-funnel marketing tactic, and whether it deserves additional budget allocation. The answer is that the full-funnel, brand-awareness-first theory is increasingly seen as outdated. Pet industry shoppers enter Amazon or Chewy often with a generic sense of what they’re looking for, and use the platform to identify a variety of options for purchase consideration. Rather than brand-specific searches, many searches are for product options that align with their values and meet their benefit criteria, regardless of brand name.
In this truncated purchase roadmap, retail media is indeed full funnel, and it bypasses awareness, starting the purchase journey at consideration, then moving to conversion, then loyalty. Data backs this up: more searches for product information now take place on retail media than on Google. Smart brand managers, instead of worrying about doing the impossible and building brand awareness from scratch on a limited budget, now only need to ensure their brand’s values and features align with macro category trends. Pet industry shoppers know what they want; they just don’t know yet which specific brand aligns best with their category map.
This new approach places a premium on research over expensive top-of-funnel awareness-building tactics. If you’re not meeting today’s customers where they’ve already decided to go on their own, you’re out of luck. The good news: if you truly understand your ideal customer profile, those most likely to passionately and organically promote via word of mouth, you can thrive on a limited marketing budget centered around retail media and back-loaded to sustain initial trial purchases.
From Search to Shelf: How Legacy Pet Brands Still Win
None of this makes physical retail irrelevant, it just changes who needs it first.
The Mars and Nestlé of the pet world sustain legacy brand success because they control retail storefronts with massive sales armies that do the drudgery of building end-aisle displays and replenishing shelves to their advantage. It’s stodgy work, but effective at securing ownership of the storefront landscape. The new retail-media-centric model allows pet challenger brands and startups to efficiently build their brands online, and selectively engage at storefront retail once they’ve achieved scale.
Why SKU-Level Optimization Matters for Retail Media in Pet Industry
Retail media tells challenger brands not only their return on ad spend for every SKU, but also enables them to create conquest sales that pick off share from the incumbent brands and focus on new-to-brand users. That SKU-level visibility means even a small team can see what’s working without adding headcount. This trial and error, with immediate feedback from agencies that specialize in the field, lets them incrementally hone both their message and their understanding of what customers want.
The Takeaway for Pet Industry Challenger Brands
Those pet brands that recognize this cost-effective, game-changing tactic, and intelligently optimize retail media search efforts over more wasteful and nebulous top-of-funnel tactics, are going to be the new champion challenger brands in the pet industry.
Game on.
