Petco Leans Into The Pet Humanization Trend With New Frozen Meals For Dogs – Forbes
Petco is once again leaning into the pet humanization trend by expanding its offerings of frozen, human-grade meals for dogs.
The retailer, which has more than 1, 500 pet retail and wellness centers, is betting pet owners who consider their pets part of the family will continue to want the best food, and services, for them, and will pay for those, even in times associated with inflation and economic uncertainty.
Petco CEO Ron Coughlin doesn’t see the pet humanization trend going away any time soon. In fact , he expects it to “pick up steam” in coming years, driven by the higher percentages of Gen Z plus millennial pet owners who embrace the humanization trend.
The fact that consumers are shifting increasingly toward more premium dog and cat foods, despite 40-year-high inflation levels, if proof of the strength of the trend, Coughlin said.
Petco is banking on its ability to win increasing numbers of the higher-spending pet owners as customers to help it weather challenges that caused it to miss expectations with regard to revenue and earnings in the second quarter, which this reported today. Petco shares closed down more than 8% today, at $14. 34, after the company reported net revenue of $1. 48 billion, and adjusted earnings per share of 19 cents.
While pet owners during the second quarter shifted away from discretionary items, such as toys, leashes and other accessories, sales of food and other consumables were up 12%, and veterinary services and grooming revenues were up 13%.
During the income conference call, Coughlin announced the expansion of its Wholehearted dog food line to include human-grade frozen meals. The new offerings are being developed regarding Petco by JustFoodForDogs, a fresh and frozen premium pet food brand sold at Petco. The Wholehearted frozen line is designed to give customers a frozen, human grade option at a lower price point than the JustFoodForDogs premium offerings. Prices for the Wholehearted frozen meals will begin at $6. 79.
“Our over-index to the dog parents who take the best care of their pets plus who are the highest spending customers continues to power a multiyear shift to healthier premium food even in this hyperinflationary environment, ” Coughlin said during the earnings call.
The Wholehearted line of dry foods, which Petco launched in 2016, has been taking share from lower quality, more broadly distributed brands, and had 30% year-over-year growth during the quarter, Coughlin stated, encouraging Petco to expand the offerings to include frozen meals. Petco has been adding coolers to stores to showcase the Wholehearted frozen line.
The pet humanization trend, Coughlin mentioned in an interview after the revenue call, reflects a permanent mindset shift.
“Dogs used to be out within the wild, then we brought them into our backyard, then we brought them into the house, and now, if your like me, your dog or cat’s in your bed. ”