With more retail pharmacies pursuing pet prescriptions, Drug Store News recently talked to Rob Devlin, Nutramax director of veterinary science division, for some perspective on what the opportunity might be across the aisle in over-the-counter pet health products.
DSN: With the number of retailers looking to expand their reach into veterinary pharmaceuticals, what is the opportunity on the OTC side?
Rob Devlin: Packaged Facts and other research groups are seeing pet care as a potential opportunity to expand OTC offerings. Much of this interest has been driven by sales and associated revenue of the OTC flea and tick products and newer OTC heartworm preventive [products]. New pet supplement products also are entering the OTC marketplace and likely will contribute to a boost in pet care sales. But it may be to a somewhat lesser extent.
Customer awareness surrounding the need for a flea and tick product exceeds the awareness of joint health, skin and coat, and probiotic supplements. Therefore, while supplements indeed will see growth from a general increase in OTC pet offerings, the ramp up in sales likely will take longer for supplements until consumer awareness rises. Many people know of and use supplements for themselves, but may not as yet realize the benefit for their pets.
DSN: What is driving consumers looking for pet health solutions into retail?
Devlin: I believe that there are three drivers for retail. [The first is] convenience. Most people are very busy with work and family, so anything that allows for one-stop shopping or provides convenience (e.g., home delivery) is welcomed.
[The] second is to benefit greater pet health. While I think everyone agrees that the veterinarian is the best authority for pet health, and pets need to have routine exams by their veterinarian, the truth is that some owners don’t see their veterinarian as often as they should. Providing quality and safe products that can be sold at retail helps provide some pet owners with options for products to support their pets’ health. Many pet owners feel that by using supplements they also can protect against costly health issues.
[The] third is cost. I truly believe cost is third on the list and ranks below the other two. However, with unemployment rates [being] what they are and fuel costs eating at household disposable income, families are looking to save costs wherever they can.
DSN: How big is the pet care universe?
Devlin: In the [United States], there are approximately 78 million dogs, while cats [number] slightly [more than] 78 million. The average number of pets per household is approximately two, and the percent of U.S households with pets is approximately 60%. The overall [market] for pets in 2012 is estimated to be $52.87 billion, which includes veterinary, boarding and pet foods costs, along with product sales.
DSN: OTC and natural pet health solutions have been available in retail sets before with mixed results. What is the best merchandising strategy — in pet care with pet toys and treats with shelf-talker call-outs? Or does it make sense to carve out a pet health block where consumers are shopping for the rest of their family’s health in the OTC section?
Devlin: First and foremost, when pet owners are considering any pet health-related purchase, we always recommend they consult with their veterinarian in order to develop a healthcare strategy designed for their pets’ needs and understand the veterinary-recommended products.
With that said, I believe that the pet health category needs to be a separate block from treats. While many treats claim to have beneficial ingredients and highlight them on the label, when one looks at the actual [nutrient levels] of these ingredients the treat is labeled to provide, it typically is very, very low. For example, a popular brand of chew sticks claim glucosamine and chondroitin sulfate, but when you look at the ingredient list, a dog would have to eat 2.2 lbs. of the product at one sitting to get 400 mg of glucosamine and 200 mg of chondroitin sulfate. And the chew stick package contains less than 6 oz. of product. In contrast, a single tablet of Cosequin DS plus MSM contains 600 mg of glucosamine and 300 mg of chondroitin sulfate.
The perception of a treat by the consumer is likely something that doesn’t cost a lot but is fun to give to a pet. In contrast, Nutramax Labs’ line of supplement products are not intended and marketed as treats. Rather, we provide pet supplement products with high-quality ingredients at levels that provide pets support beyond what they get in their diet. Cosequin likely is the only branded joint health supplement for dogs, cats and horses with any significant brand awareness, and is the No. 1 veterinary-recommended joint health brand.
Many other products crowd the marketplace, but retailers need to be mindful of their selections as there are products that have failed to meet label claims when tested by third parties. Even some pet food companies have had issues with melamine contamination or salmonella contamination of their products, and perceptions about the product issues can spill over to affect the retailer.
Many customers shop by room or by task, so keeping all things pet together likely will help the customer quickly find what [he or she] needs/desires and [will] minimize frustration when searching for the product. Section headers by indication (e.g., flea and tick, heartworm, joint health, skin and coat, etc.) will enhance the shopping experience and allow [consumers] to quickly find the products.
Pet owners also shop by brand, especially those brands recommended by their veterinarians, and many will not substitute other products. I also feel that more is not always better but may lead to confusion. If a shopper is unsure of what supplement or healthcare product to buy due to a myriad of products on the shelf, then [he or she] might not purchase at all, which delays or stops the pet from enjoying the benefits of the product.