Does Petco have a story to tell?

Petco is apparently changing hands, from one private equity investor to another. This follows unsuccessful attempts at an IPO or a merger with PetSmart. My brief comment (at RetailWire) suggests that Petco is trying to trade on the “omnichannel” issue to make its strategic future look brighter:

“Omnichannel” is a useful buzzword to suggest that any retail company is on top of its strategic game right now and therefore a good investment. This may or may not be true in Petco’s case, but the previous owners weren’t successful in merger talks with its bigger competitor nor with an IPO. The previous PE owners seemed determined to get out from their investment, one way or another.

Praise for Target’s holiday TV campaign

RetailWire ran a weekly series of face-offs comparing holiday TV spots for various retailers. The “finalists” included everybody from PetSmart to Radio Shack. In my view, Target’s campaign came up the winner this year:

There were several effective ads among the weekly winners, but I still vote for the Target commercial as the overall champ. This spot turned out to be the kickoff of a well-sustained, consistently themed campaign that ran through Christmas. The focus on category dominance in toys never got lost in the creative execution, while the ads struck a nice balance between emotion and “attitude.” (See the followup commercial with the “naughty boy” getting a lump of coal in the form of an antique cell phone.) Well done, Target, and consistent with the brand position you are trying hard to recapture.

PetSmart expands its service offerings

Another chance to catch up on last week’s Retail Wire postings. This discussion centers on PetSmart and its move to offer more in-store and even in-home services for pet owners. I equate the strategy to the Best Buy “Geek Squad” template:

PetSmart is following the Best Buy model: Establish a service-oriented niche (like Geek Squad) that becomes its own profit center as well as enhancing the overall brand position. Geek Squad has been a valuable marketing tool not only to drive direct competitors out of the marketplace, but also to differentiate Best Buy from Walmart and other discounters.

There is definitely an existing and growing market for PetSmart’s new services. Pet supplies are one of the few categories that seems recession-proof in the past year, and there is plenty of research demonstrating that the household dog or cat is perceived as a “member of the family.” The increasing number of empty-nest Baby Boomers in coming years (with some disposable income, if they’re lucky) will only drive this mindset further. So a smart move by PetSmart, as long as good execution accompanies good marketing.