In three major media publications this week it was reported that the pet supplement industry is where the natural products industry was 15 years ago, and I agree.
From my perspective sitting a top a new business and website — I’ve looked at the markets and studied everything I could get my hands on and all indications are that the trend is solid and it makes perfect sense.
In the natural health business, all product categories are packed, jammed tight in which several major players dominate and penetration is tough, there are listing fees and branding is expensive.
At this juncture not so in the supplements business for animals. Herbal bladder control capsules for dogs, all natural anxiety formulations, urinary tract support, joint relief for horses — take a walk through any pet store, natural foods store or vet clinic and you will see a complimentary medicine revolution taking place. As a result many top guns such as Thorne, Heel, FoodScience Corp, Nordic Naturals and Flora Health USA are seizing the opportunity and moving into the business and using pet supplements as the tip of the spear to maneuver.
In the August 4th issue of Nutrition Business Journal, the title of which is Are Pet Supplements a Good Brand Extension for Human Supplement Firms, they reported the going is tough and this new territory has its own intrinsic set of challenges such as a convoluted regulatory environment and a veterinary field that is ultra cautious. But from 50,000 feet it makes perfect sense.
Whilst I was the CEO of Biomed International (Canada) and Terra Medica Natural Medicine (United States) we were looking for additional revenue streams where we could find them. The reason was simple. We were operating professional lines of German homeopathics and there were just so many accounts we could land and that meant a revenue ceiling and diminishing long run returns as our costs and overheads slowly rose.
So brand extension into new markets with formulations that could be tweaked to work in the pet busines made perfect sense to us at the time. But the article in the Journal also said something else smart too, and that is that there is no automatic guarantee that extending your reach into the pet world is going to work. You may have a signature brand but can it translate to the animal kingdom?
“It’s definitely a good time to get into the business, ” said Dale Metz, CEO of FoodScience Corp. and a founding member of the National Animal Supplements Council (NASC). “But if you are a human supplement company and you think you can just take your existing product line and put it in a capsule for an animal, that is not the case. Its complicated.”
In my view there are two amazing product lines (both of which we carry) called Nordic Naturals Cod Liver Oil and Udo’s Pet Essentials from Flora Health USA that will do brilliantly – and in fact already are proving to be top performers in our webstore.
We stock their pet supplements and oils and our sales are rising. Udo’s and Nordic — these guys are the best in the supplements biz so re-calibrating their formulations and moving into the pet business is one smart move.
However, I think all companies that are moving in this direction have one thing in common and that is branding. At this early stage its not so clear that Brand can affect sales in the pet market and the reason is I think is that consumer is different, or maybe we don’t really understand their behavior yet because its just too soon. Inotherwords will the Nordic brand in Whole Foods translate to Woofits Pet Store here on Cambie Street?
So for me the moment I can’t answer that question, however I realize the big BOOM opportunity! I love figuring out my customer and calibrating how to talk and discuss and appeal to them. For me starring into the abyss is fun and I relish the opportunity to figure this out. Right now for example allpetnaturals is running Facebook ads and from that we are gathering very rich information about about our customers, and where they live and the surprises keep coming at me everyday.
But back to the supplments business and pets for a minute or so more. I would say that we really don’t grasp brand power and how that translates to sales in this new frontier, we don’t really understand consumer behavior yet and the marketing is all different. For one thing, human behaviors around pets is highly emotive. As pet owners yourselves you are especially cautious and careful and in a funny sort of way more so than when you buy vitamins for your kids. Lets be honest about this right?
So this foggy triangle is what I think is one of the barriers to success in the category slipover into pet supplements. As more and more firms begin downloading their supplements and other herbal or biological medications into the pet world they will find themselves up against these three things.
Over the next few weeks I will be reporting how we are unraveling these questions and sharing these insights with you – which will make us both more savvy and aware. Thanks for reading and good health to you and your wonderful pet companions. Namaste.