November 1, 2022 | In the News
Making Way for Millennials & Gen Z
Long-term success in the pet industry depends on retailers’ ability to understand and serve the burgeoning millennial and Gen Z pet owner demographics.
Anyone who understands the pet industry understands the importance of appealing to millennial consumers, which currently make up the largest group of pet owners, 32 percent according to Volume four of the American Pet Products Association’s (APPA) Generational Report, and spend the most money on pets. And yet, looking solely at millennials as the future of the industry as opposed to paying equal attention to the group right behind them–Gen Z—would be a mistake.
There are many commonalities between the formative experiences, challenges and values of the two groups, though the majority of Gen Z is not quite as established in their careers and personal lives as most millennials—explaining why this group on its own accounts for just 14 percent of pet ownership. Still, Gen Zers are growing up, forging their paths into adulthood and their prime spending years, so it’s vital that pet specialty retailers start thinking about them as a considerable demographic and adapting to their existing behaviors to drive sales.
It’s not enough to merely be in tune with the fact that combined, millennials and Gen Z make up nearly half of all U.S. pet owners, though. It is crucial that retailers—big box and independent, alike—build a model that is not only conducive to winning the positive attention and business of these consumers, but also anticipates their needs.
Making the Most of the In-Store Experience
Competition in the marketplace, particularly from online outlets, shows no signs of slowing, but while e-commerce is quite popular with younger consumers—many of whom practically grew up on the internet—research shows that it is well worth retailers’ time and effort to focus on enticing these shoppers to prioritize an in-store experience.
According to Nathan Richter, senior partner at Arlington, Va.-based Wakefield Research, it is possible to overstate the volume of purchasing happening online. Gen Z and millennial pet parents are still shopping brick and mortar, he says. Pet food tends to be a separate category, but in terms of other pet products, Wakefield’s studies have found that 46 percent of Gen Z and 34 percent of millennials say they buy the majority of their pet products in store.
Additionally, about 39 percent of Gen Z and 41 percent of millennials actually felt they could get a better price in store, and 39 percent of Gen Z and 28 percent of millennials cited shopping in store for expediency purposes. They don’t see buying online as more convenient, because they would have to wait for shipping as opposed to having peace of mind that the product they wanted can more immediately benefit their pet.
These groups understand the importance of the in-person shopping experience, and it’s important to note the specific driving forces behind their visits. Richter notes that 51 percent of Gen Z and 55 percent of millennials cited wanting a tangible experience—feeling, seeing and trying a product before buying it—as a reason for going to a store rather than shopping online.
Alternatively, 47 percent of Gen Z and 55 percent of millennials pointed to entertainment as the reason for shopping in stores. They enjoy exploring the store floors, browsing for enjoyment, and often ultimately make some kind of impulse purchase. Richter sees this as an “interaction of opportunity” as opposed to the former, which he sees as a more “intentional interaction.”
Regardless of the motivation behind the customer’s visit, the retailer’s goal is not just to get customers in the door. Retailers need to think about how they will increase repeat visits, encourage customers to suggest the store to their peers, and of course, buy as much as possible.
“We try to focus on strategies that extend beyond pricing and discounts, because that’s a battle that retailers can’t often win. And so it’s really easy to tell someone ‘make it cheaper,’ but that doesn’t exactly build a successful business,” says Richter.
Most times, competing on price with an online company like Chewy or Amazon is just not feasible for a brick-and-mortar retailer, especially in the independent space, but online-only services don’t have the same engagement abilities, so retailers need to use this to their advantage.
“There are sort of two main strategies that we think can leverage the motivations for why customers are already coming into the store. And those are: entertain and educate,” says Richter.
“And those are not mutually exclusive. You can do both. Educating your consumer about pet ownership and demonstrating that you’re a resource for how to best care for their pets is one of the best strategies you can have. It depends heavily on educated staff. And there are resources out there to make that happen.”
Pet Store Pro, for example, is a free online training resource meant to help pet specialty retailers enhance their business model and ensure their staff is well-equipped to guide customers to take the best possible care of their pet. There is so much impact, Richter says, from having customers walk out of a store pleasantly surprised by how much the floor staff knew about how the products on the shelves contribute to animal welfare.
Enhancing Engagement Strategies
Retailers who feel confident being a resource and leading discussions with customers that will ultimately yield profit should advertise this through all channels possible. Richter points out that this can certainly extend to an online and social presence, but it doesn’t have to be too technologically complex. Things like in-store signage that encourages customers to ask a staff member about a product or in-store initiative that prompts a meaningful conversation is extremely effective.
In terms of entertainment, retailers should be creating events and in store opportunities for pet owners to show off their pets, Richter offers, adding that pets often function as a sort of badge for the type of person their parents are, what they enjoy, their values, etc…While this can be done on social media to an extent, many pet parents bask in the opportunity to get their pets out of the house and interacting with other pets and pet lovers in real time.
Richter explains that pets are often a “social conduit” in public social spaces. They become an avenue for pet parents to build social connections with other people and garner positive, healthy attention via their beloved pet. Retailers can capitalize on these desirable experiences—for example, by building a branded social media corner in the store, where visitors can dress and take photos of their pets with in-store products, clothing and props, whether it be a seasonal theme or just for fun.
These generations are more likely not only to participate (PetSmart-sponsored research on behalf of Wakefield showed that 86 percent of millennials and 81 percent of Gen Z like to dress up their pets on occasion), but if it’s a positive experience, they will often also broadcast and recommend it to their social circles.
Building Your Brand
Millennial and Gen Z pet parents are often willing to spend a significant portion of their income on products that they are confident will enhance their pet’s quality of life—and that is not exclusive to those with a great deal of disposable income.
These generations also tend to apply thoughtful criteria when choosing products and brands believed to enhance the pet’s health and happiness. These are conscientious shoppers, so retailers need to find out what their customers demand and stock their shelves with brands and products that align with their values.
Michael Johnson, president of FINN CADY Strategy & Brand, a marketing and researching agency that connects organizations with consumers, regularly consults retailers and manufacturers on the dynamics of the pet industry. He notes that these generations are more apt to live a sustainable lifestyle and that applies to products they buy not only for themselves, but for their pets.
Additionally, they are attracted to products that have some kind of goodwill or cause marketing behind them, Johnson says, adding that Gen Z tends to be less inclined to prioritize the Made in USA label. They’re willing to broaden their horizons and purchase products sourced elsewhere as long as those products meet other standards.
This is not to say, though, that Gen Z and millennial customers don’t care about where things come from. In fact, they are more likely than other generations to question specific agricultural, ethical and manufacturing standards, sustainability and environmental practices, nutrition and health factors, brand recognition and reputation, presence of chemicals or lack thereof, and corporate responsibility of a company, according to Johnson.
These are still just general categories, and while they serve as a guiding principle regarding these generations, there is still variety and diversity within the Gen Z and millennial cohorts, and that variety should be reflected in a store’s product offering.
APPA’S recent Generational Report showed that 54 percent of millennials and 52 percent of Gen Z consider themselves to be brand loyal, and that Gen Z leads the category in small pet ownership, compared to the other generations, and owns the most fish, birds, reptiles and horses. With that in mind, retailers should always be honing in on their specific customer base, finding out what kind of pets their customers own, who they are and what they are specifically looking for.
Richter says retailers should be collecting information that is directly relevant to the scope and scale and aspirations of their business, so strategies—especially digital — will vary based on specific demographics. In order to do this successfully, he suggests figuring out who your company is, who your customers are, where you’re operating, and what your footprint will be. He says this will likely lead most retailers to realize the advantage of staying hyperlocal, knowing and being part of the community they exist in.
Johnson points to the importance for pet retailers to implement a unique branding strategy. He says the success of Starbucks, for example, is partly due to its branding of its products as a commodity.
“How do you do that in pet?” he asks. “How do you take something that everybody else is doing, and do it in such a way that you’re not selling a product anymore, you’re selling experience, you’re selling lifestyle, you’re selling aspiration.”
While it’s clear that customers across generations will respond to this kind of messaging, millennials and Gen Z are substantially attracted to a shopping experience that will make them feel fulfilled, and that extends to their role as a pet parent.
Fighting Fire With Fire
Technology is not going anywhere, nor is the Gen Z and millennial preference for the convenience of online shopping. But the success of online pet retailers with millennials and Gen Z doesn’t mean game-over for brick-and-mortar stores, especially since they have the potential to succeed in both the digital and in-store spaces.
Johnson emphasizes the fact that even if millennials and Gen Z pet parents are shopping in a store, they still have digital devices at the ready to do their research at the point of purchase.
“[Reviews] are important to everybody; they’re really important to the younger generations. They really want to know what other people think. Word of mouth fuels a whole lot of their purchases,” he says. “And so if you have a bad review somewhere, they’re going to see it immediately. And I think they’re more adept than other generations at being able to immediately tap into the good and bad digitally.”
Retailers with a handle on what’s working in stores should be promoting that online. If your customers love coming to your store because you offer grooming and training services, for example, that’s something that should be boasted on social media. You can promote the services and products in your store through photos and videos, and post them to your social platforms. Once you’ve garnered some online attention, encourage people to visit the store to learn more about your offering, or direct them to buy through your own website.
Rebecca Tomala, vice president, client and creative services at full-service marketing agency Matrix Partners, emphasizes the importance of reaching millennial and Gen Z pet parents through as many touch points as possible online.
“By creating an engaging online presence, retailers can create a connection with their customers before they step foot into their store,” she says. “Utilizing a strategic digital campaign will help retailers reach their customers where they spend a lot of their time—on their phones.”
Erin Terjesen, principal of Ariz.- and Calif.-based public relations firm Propel Communications, points to retailers’ need to “not only manage their store(s), inventory, employees, and so much more, but to stay competitive online with a great first impression and to keep traffic coming in the door.”
The Propel team, she says, works to help retailers, groomers, veterinary practices, trainers, and manufacturers/brands optimize their online presence through Google Search. For retailers, Google Maps is a significant and free tool retailers should be utilizing.
“Our mantra with Google Maps is Claim-Personalize-Manage,” Terjesen explains.
“We’ve found that many pet retailers haven’t yet taken the first step to ‘claim your business’ and make sure their online profile is complete and personalized, overwhelmingly positive with reviews, insightful with photos, and a current list of services and offerings, so we always start there.
“Since most pet parents (your customers) are searching and navigating on their mobile device, Google Maps makes it easy by allowing the user to find your business based on location, but also access your phone number, see photos, read customer reviews, learn about offers, etc. to make a quick yet informed decision. Google Maps acts as both a search engine for more potential customers to find your business, and also provides a one-click map for these users to navigate to your location too.”
According to Tomala, social media should also be an important part of any pet retailer’s digital engagement strategy—and for good reason.
“For new product awareness, APPA discovered millennials and Gen Z are more likely to find a new product, store or service through the internet or social media. To support that statistic, 50 percent of Generation Z and 44 percent of millennials are on social media daily,” she cites.
Social media comes in many forms and can be so intricate that it seems overwhelming without in-house experts dedicated to media relations. Tomala assures retailers that they can create a successful social media presence that is specific to them without trying to use every platform and follow every trend at once. She suggests starting with one or two social media channels, and focusing on those.
“I recommend starting with Instagram and Facebook. It’s best to post during weekdays since people are most likely to look at their phones on a work break or after their workday, instead of when they’re busy on the weekends,” she says. “Additionally, retailers should post in the morning, so their post is shown throughout the entire day. This is when the scheduling tool on the Meta Business Suite comes in handy!”
The most impactful social media content will keep a customer base engaged, educated, and eager to support your business, Terjesen says. Achieving this might mean making a worthy investment in partnering with an agency that can collaborate with and help retailers expand their digital reach. Find a partner that can collaborate with you to help create a digital strategy that works for your specific business model and goals.
Source: Pet Business
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