PetSmart on Thursday launched a new loyalty program, dubbed PetSmart Treats, now available through its more than 1,600 U.S. locations in the U.S., Puerto Rico and Canada, as well as online. The retailer said it partnered with loyalty solutions firm Aimia to create the new loyalty program.
PetSmart's mobile app allows members through the program to see their points status and rewards while they shop. Members also earn eight points for every $1 spent in stores and online, points on pet services including grooming, PetsHotel, Doggie Day Camp and training, and for donations to the company's PetSmart Charities, according to the retailer's website.
Those points garner discounts "on items of their choice,” and members are also privy to other discounts on hundreds of products, according to a company press release. Members also receive a surprise on their pet's birthday, free shipping on orders over $49 and a free Doggie Day Camp session when they buy 10.
PetSmart has positioned itself well in a growing but highly competitive retail space, thanks to its acquisition last year of popular online pet supplies site Chewy.com, but there's no room to relax.
The retailer has been growing since it was taken private by a consortium of private equity buyers in 2014 — expanding its store footprint, moving into more pet health care services and revamping its website, in addition to its Chewy buy. But online sales, the fastest growing channel for pet sales now and likely for the next five years, are putting pressure on the legacy brick-and-mortar retailer and its rival Petco, according to a report this week from Moody's Investors Service. And PE ownership has left both highly leveraged, Moody's warned in its report.
Both enjoy advantages thanks to their brick-and-mortar fleets, however — despite the fact that physical store sales have declined at both over the past two years. Stores allow the retailers to offer services like grooming, training and healthcare, according to Moody's. PetSmart, Moody's analysts also noted, is the largest pet service provider, which gives them the advantage of additional store traffic and a relatively safe position given the high barrier to entry for competitors.
Revamping its rewards could help protect that. Loyalty programs have long been a way to lock in (or at least corral) customers, and PetSmart joins a host of other retailers that have lately revamped their programs to attract more members. Younger shoppers like millennials in particular respond to perks like special discounts and free shipping, according to research from loyalty marketing firm Kobie emailed to Retail Dive. A majority (78%) of millennials value access to discounts and a healthy 28% value convenience, more than any other generation, according to Kobie's report.
Target, Macy's, DSW, Kohl's and J. Crew are among those changing up their loyalty programs, in some cases expanding rewards beyond store card users.