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Can Walmart Dominate the Veterinary Industry?
On Sept. 20, Walmart opened its first-ever Pet Services center in Dallas, Georgia, in a pre-existing Walmart store. According to Walmart’s announcement, “The new center will offer a variety of pet services, including veterinary care and grooming, in a dedicated storefront.”
Fox Business noted that plans for this move began in 2019 when Walmart announced that it aimed to “open up several dozen more veterinary clinics in its stores throughout the country as well as launching an online pet pharmacy that will deliver pet meds straight to your door in hopes of luring millennial pet owners who spend more than $1,285 a year on their furry loved ones.”
Dog and cat owners no longer have to wander far for top-notch care; the Walmart Pet Services center provides routine vet services, from timely vaccines and wellness exams to minor medical procedures. The center also offers a full suite of grooming services, including baths, nail trimming, and teeth cleaning sessions.
The new pet center in Georgia was specially chosen since Walmart also built its first-ever health center in this same location in 2019. The company plans to roll out future Walmart Pet Services centers based on the Georgia model. Additionally, “Walmart currently offers 65 locations with in-store vet clinics, which are owned and operated by PetIQ.”
Fox Business explained that “the push for more affordable pet health care comes as prices continue to rise in the pet category higher than the national inflation rate, according to the U.S. Bureau of Labor Statistics.” With 66% of U.S. households owning pets, per the American Pet Products Association, millions of Americans are feeling the pressure of these rising costs to care for their animals.
In its announcement, Walmart stated that its new pet services center “will offer low, transparent pricing for key pet services.” It also said that “increasing access to convenient and affordable health care for our customers is central to our mission of helping people save money and live better.”
Walmart also recently released a new subscription service that allows customers to “schedule automatic deliveries of their favorite frequently purchased items at a cadence that fits their preference,” including pet food, cat litter, treats, and more.
In the U.S., pets like dogs and cats are increasingly regarded as part of the family, leading to a rise in consumer spending on everything from veterinary care to trendy pet accessories — and Walmart isn’t the only retailer that has noticed this trend. Various companies are making efforts to tap into this growing market. For instance, Kohl’s has begun allocating sections of its stores specifically for pet-related products. Similarly, Lowe’s, after a successful trial, is broadening its initiative by incorporating mini Petco Health and Wellness boutiques and offering mobile veterinary services in many more locations.
CNBC explained that “retailers consider the pet space, much like items for kids, an attractive area because consumers are usually still willing to spend when their budgets are tight or the economy hits a rough patch.”
However, this sector is never guaranteed. Earlier in 2023, Petco, Chewy, and General Mills, which makes Blue Buffalo dog food, “warned that some pet owners are becoming more price-sensitive and even trading down to cheaper pet food as they deal with inflation.”
Discussion Questions
Does Walmart have the right pieces in place to take on the competition in the pet industry? Are there other aspects of the pet industry that Walmart needs to be aware of?
Poll
Loading …BrainTrust
Mark Ryski
Founder, CEO & Author, HeadCount Corporation
Lucille DeHart
Principal, MKT Marketing Services/Columbus Consulting
Walmart has been nibbling at the market since 2019, and it now seems to be refocusing efforts on the category. And any category that Walmart chooses to focus on has the potential to impact the entire category. With its size and market coverage, Walmart could be a major player in the pet industry, and the rationale for doing so is solid. The pet care industry is not only significant in size, but pet owners have a willingness to spend, and they are becoming more price conscious. These are ideal market conditions for Walmart to make a big play in what appears to be an ideal market.
Frankly, Walmart could dominate any segment it chose to address. It has the discipline and resources to master any function. The established players in the pet space will be watching this carefully.
Walmart can expand its footprint (or pawprint) in the pet industry by targeting big box competitors like PetSmart and Petco — not to mention developing a Chewy-style “store” within its website. It’s definitely an opportunity that other discounters are not maximizing.
But offering veterinary services inside a Walmart store is a whole different animal. I believe most dog and cat owners (like this one) have a relationship with their local vet clinic based on years of trust and caring service, and that’s not so easily earned by Walmart.
I will never forget the survey that found women take more time choosing a gift for their pets than they do for their spouse or significant other. Makes sense since pets are part of the family. Four-legged kids. So why then wouldn’t we choose the best, and most affordable, health care for them?
This is a smart move for Walmart, but the retailer isn’t alone in offering vaccines, wellness exams, minor procedures, and grooming. Big box pet retailers like Pet Smart already provide these services and more.
Depending on reviews I might visit such a clinic for a basic vaccine, but not for advice or any medical procedure. I am one of those people who takes time choosing what’s best for my pets. Their veterinarian is as important as my personal physician. And I don’t think I am alone here.
I don’t think so. It’s a crowded space, and Mars seems to have the Lion’s share of everything. They bought VCA, many of the major pet food companies and also own Banfield Vets.
Unless they can provide 24/7 vet emergency services, they have nothing interesting to add.
Pets are members of the family, and Walmart is all about living better for less, so this is a win. Lower costs for pet services are needed in today’s market and bring customers into the physical stores. Given the number of stores, however, finding talent may be an issue.
It’s a great question. Fellow panelists have brought up some thoughtful considerations. Pet owners who shop Walmart might have existing relationships with their vets, and their vets might be more conveniently located. Walmart should determine who it’s going after – a younger audience, an older audience, families or is it regional understanding. Clearly there is a segment of shopper who is open to it. They might want to wrap pet insurance into Walmart+ for a nominal fee, make scheduling easy, create a best in class digital experience to attract younger shoppers. I think they can chip away at the competitors here and there, they’ll need real commitment to dominate.
I first have to ask which part of the pet industry? It isn’t a monolith after all. The veterinary industry, for example, is undergoing a period of roll-ups and consolidation much like human healthcare making it a bit harder to take them on, especially considering the cost/availability of vets and qualified vet assistants. If we are talking about taking on pet superstores, aren’t they already in competition with them? Now, grooming is yet another story. It’s a little bit like human haircuts. Some folks are happy with a trim anywhere and others swear by their own barber/stylist. So, I’d say this one merits a “wait and see” approach before answering. Will they do business? Of course. Will they dominate the industry … depending on how you define it? We’ll see.
Walmart has the ability to compete with pet industry box stores and independent retailers. They have size, location, etc. For many consumers, Walmart is already part of their shopping routine. Adding more in the pet department makes complete sense, including veterinary services.
Walmart can be successful, but it will have to formulate the right balance of assortment and services at the right price. There are many independents in the arena that are making a great imprint in pet care. Let’s see where this goes.
Dominate? No. Succeed? Perhaps. There’s no mystery as to WalMart’s success: low prices..always! It became a juggernaut that overwhelmed competitors when price was all that mattered. Services, tho, are not commodites; or even brands: they’re very personalized, and there’s more than just price at work. Their messaging, emphasizing low price(s)…surprise!, suggests they may not understand that. Or maybe they feel it’s still their strongest hand. We’ll see if they win…or fold.
While Walmart has the resources and capacity to execute on this, I think success will be largely dependent upon the location. If they are in a community with few veterinary clinics or where clinics are over capacity (like mine are), the potential is there. They will need to ensure that the service is not transactional or cold to gain loyalty and repeat customers.