Commentary
The paradox of pet owner spending remains perplexing. However, Chewy’s successes show the convenience of sourcing a wide range of inventory online and a growing comfort with the services.
On one hand, nearly two-thirds of pet owners say inflation has made it more difficult to pay a surprise vet bill and they’re nervous about rising prices of vet costs, according to a recent Forbes Advisor report we referenced on October 3rd <Link>. By contrast, a few days later we shared the intended pet spend for Halloween saying, “The juxtaposition of economic commitments is bizarre, not surprising, but mind-boggling” <Link>.
Conversions to Chewy’s Autoship and Autoship customer sales continue to outpace overall topline growth.” – Sumit Singh, Chewy CEO
Chewy is touting its ability to grow wallet share within customers, defined as net sales per active customer. The wallet share term would likely make veterinarians cringe if used in the context of their businesses, despite measurements showing increases in revenue while clients, invoices and patients decline <Link>.
A Talker survey referenced below reveals more confounding 2023 pet spend data which seemingly places pleasure ahead of prevention*.
Source: Pet Product News, December 2023. Link.
Related: *Survey reveals how much Americans spend yearly on their pets, Talker, December 11, 2023. <Link>
- The average pet owner spent about $4800 in 2023 of which $1242 was for vet visits
- Pet owners spent $633 on pet food while spending more on treats ($645)
- The average spend for toys or pet clothes approached $600
- 83 percent said there’s realistically no limit on what they would spend to make sure their pet is healthy and happy
- BUT . . . 45 percent said their pet had a major health event for which 85 percent weren’t prepared for the cost of the event
INSIGHTS: While pet owners may be a bit more cautious <Link>, redirecting the spend on treats and toys by 50 percent or more would easily fund pet insurance for most. It would also make it easier to make decisions about preventative care, consistent socialization, behavior training and more. We noted the metrics did not list any daycare or boarding expenses.