U.S. An anti-Amazon alliance in pet-food

There may be an alternative path for retailers to escape the Amazon steamroller. In the U.S.A, the Group created by Jeff Bezos controlled 38% of total online sales in 2019 (source: eMarketer, data to June 2019). However, within the pet food category, the Chewy pure player, acquired in 2017 by PetSmart as the biggest specialist pet food retailer, holds a significant market share. Founded in 2011, Chewy retains almost 50% of the online pet-food market in the U.S.A., compared to 45% for Amazon (according to 1010Data). Figures show Chewy is growing faster than Amazon: between 2012 and 2018, sales jumped from US$26 million to US$3.5 billion.

PetSmart is a traditional specialty retailer with 1,650 stores and sales of US$8 billion in 2018. The firm (controlled by the investment fund BC Partners) has been strengthened by acquiring a pure player. In 2017, however, this appeared to be a risky investment. Toys’ R’Us filed for bankruptcy as it failed, among other reasons, to adapt to the competitive pressures of e-commerce. PetSmart was in debt for US$6 million at that time and posted stagnating sales.