The Role of Pet as a Center Store Anchor

As discussed in the previous Tip, grocers rely on Center Store categories to drive over two-thirds of their total store sales. Further Center Store's total store profit contribution is nearly 88 percent.¹ And yet when it comes to merchandising and promotion execution, often perimeter departments steal most of the attention.

The less-than-satisfactory results of this "disconnect" in Center Store can be seen when evaluating the Pet category. Pet Care products are purchased by three-out-of-four homes in the U.S. However, only half of those category buyers are doing their purchasing in grocery stores.²

Supermarkets typically have the advantage over many other formats when it comes to shopping frequency and location. So why are grocers losing market share? Price is an obvious answer. But consider that during the recession years, the Pet Care category maintained its historically healthy growth rate of around 5 percent. Although supermarkets contributed some of this growth, much of the gain occurred outside traditional channels.

The recession taught us that shoppers continue to indulge their pets, even when scrimping on other family items. Just as these consumers consider their pets part of the family, supermarket operators can make sure they have an important place in a family's life by providing an appealing, well stocked, easy to shop, Pet aisle.

Just how important are Pet Care products to consumers?
In the U.S., the Pet Care category ranks eighth in total annual grocery/drug/mass sales, coming in just behind Milk and Packaged Meat -- and edging out Cheese and Beer.³

Pet Care's value and influence stretches beyond the Pet department. Pet shoppers index higher than non-pet shoppers, spending 27.4 percent more annually, driven by larger baskets.²

It's not that the fundamental value of Pet Care is lost on grocers; typically, Pet is one of only a few full-aisle categories in their stores. But like a well-behaved middle child that gets less attention than his "high-maintenance" siblings, the category is taken for granted. Retailers need to work the consumer-centric approach aggressively -- optimizing the mix of new and established products; creating attractive end aisle and secondary displays to bring excitement to the department; and laying out the aisle to emphasize ease of shopping.

Pet Care is a high-producing, anchor department that yields substantial benefits for retailers willing to apply the necessary creativity and energy. With a good team effort, grocers can once again become the favored outlet for pet owners' needs.

LEARN ABOUT PET CARE'S CONTRIBUTION TO CENTER STORE -- and the TOTAL STORE... Within Center Store, Pet is one of the few full-aisle departments and can be a signature differentiator in the battle to maintain market share vs. Superstores and clubs. For more on this topic, use the form below to download a special presentation from Nestlé Purina PetCare.

¹ Willard Bishop, Competitive Edge, March, 2007
² 2008 Nielsen Custom Channel Facts
³ 2009 Nielsen Strategic Planner – Food, Drug, Mass with Wal-Mart, 52 wks Dec 26, 2009