NEWPORT, Ky. -- Grocers who have seen their pet aisles come under attack from nongrocery channels should be wary of an old competitor, too -- other supermarket operators.
"One of the biggest changes in pet food is that [supermarket] retailers are changing their strategies on how to market to consumers to respond to the threat they've had for the last five to eight years from nongrocery channels," said Ed Johnson, vice president of sales at Heinz Pet Products here. Following its acquisition of the Quaker Oats pet food division in 1995, Heinz is the No. 2 player in the pet food category, with brands such as Cycle, 9-Lives, Gravy Train, Pounce and Kibbles 'n Bits.
"Some of the folks we work closely with are evolving into being more competitive with their variety, their merchandising, signage, and the appeal and atmosphere of their stores. In some cases, a few [retailers] have actually turned around what was negative into a fairly positive situation, which is encouraging."
Speaking to SN the day after a meeting with officials of Wegmans Food Markets, Johnson cited the Rochester, N.Y.-based chain as one taking an aggressive approach.
"They've reset their whole store, devoting more space to accessories and to direct-store-delivery-type snacks, pillows, beds and kennels," he said, noting Wegmans made the changes chainwide. "They've done an exceptional job of resetting their aisle in the grocery store to have the look and feel of a pet store, with signage, with the accessories and with the way they've merchandised it."
Johnson said Wegmans is pleased with its results since altering its aisle, but declined to give specific figures. However, any grocer who puts a greater emphasis on the pet food aisle will reap benefits, Johnson stated.
"It's akin to the detergent or paper towel aisle; you don't want to lose those categories, those dollars. You need the aggregate of those categories to build your transaction amount at the register. The pet food category is one of the largest in the grocery store, about $8 billion in sales. The consumer is there every week purchasing products."
Nongrocery channels have been most successful, Johnson noted, in luring purchasers of large bags of dry dog food, making improvements in that segment a must for retailers seeking to improve their pet aisle business.
Keeping dry dog food against the wall behind the registers is not the answer, he stated. "If it's up in front, it's sort of out of the way," he said. "Consumers might forget or may not even see it. You improve your odds of success at least two-fold by being in the aisle. Wegmans has actually created a different shelf for the lower shelf of their aisle to accommodate the large variety of 20-pound and 40-pound bags. That's a big piece of their volume."
Johnson applauds the category management efforts under way in pet food.
"No matter where I go, depending upon the degree of expertise in category management, customers are very focused on lowering costs and improving profit margins. In general, it's the medicine that's needed in the industry -- particularly in pet food -- to be competitive with the nongrocery outlets. It's created an opportunity for us to be more involved in strategy, where in the past we were never part of that process. That's exciting and a lot more fun."
Category management in the pet food aisle is outpacing most other areas of the store, Johnson noted.
"It's probably one of the top four or five categories that's been focused on. Pet food receives a lot of attention because of the size, the profitability for the store, the importance of that consumer to the store, and the fact that it's under attack or under fire from other outlets."
Category management can help in the creation of pet centers, a concept used by an increasing amount of grocers, including A&P and Kroger.
"The more we move into category management and the more category managers have complete control, the easier it is to do. They've got to make that distinction, culturally. A few people like H.E. Butt, Publix and Wegmans are moving in that direction where they're able to move more swiftly because of the focus they have on category management."
Events such as pet fairs are another positive for the category, Johnson noted.
"It becomes a good community thing to do. It certainly is a good opportunity to build your image and integrity with the community in terms of your commitment to pets and your willingness to be concerned about the care of pets." Heinz works with several retailers through its Homeless Homer program to help stray dogs and cats.