As Amazon and Walmart gear up for their summer deals events, digitally native brands are seeing the opportunity to scale in ways that would never be possible without these shopping surges.
For Pawstruck, an online pet supply company, Prime Day represents a crucial opportunity for growth and visibility. Founded in 2014 by CEO Kyle Goguen, Pawstruck has leveraged Amazon’s platform to expand its reach and scale its operations in ways that would have been unimaginable through traditional retail channels, and Prime Day compounds that effect.
“We know Prime Day is a day where we can get products in the hands — or mouths, in our case — of dogs that wouldn’t have been exposed to us otherwise, because everyone’s just looking to find deals,” Goguen said. “So, we’re going to put a lot of resources in getting that food in front of people.”
The customer acquisition boost that the deals event offers, scheduled for July 16 and 17, can be more than just a two-day sales spike. Reaching new consumers in the dog food space can mean a new loyal customer for the duration of their furry friend’s life.
“If you’re a dog owner yourself, you would know — you find food that your dog likes. So, if your dog’s eating it, and they’re not having digestive issues, you don’t switch, pretty much,” Goguen said.
Pawstruck’s story begins in Southern California, where Goguen, a recent engineering graduate from USC, found a gap in the market for affordable, healthy, natural dog treats and chews. In late college, Goguen got a dog, and was disappointed by the options available.
“I started to realize that the healthy, natural treats and chews either weren’t available online or they were super expensive in the brick-and-mortar stores,” he recalled.
This realization spurred him to create Pawstruck, a company dedicated to providing high-quality pet products at reasonable prices.
Initially, Goguen focused on selling through Pawstruck’s website, but he quickly discovered the challenges of customer acquisition without substantial experience or budget.
“It was slow going early on. We had really good products that we sourced, but no one knew who were,” he admitted.
The turning point came about half a year after launching when he decided to list Pawstruck’s products on Amazon, and deciding to invest more in the channel was “really the light bulb moment” for the brand.
By the end of 2014, Amazon had become a significant sales channel for Pawstruck, rivaling its website in importance. Over the past decade, Amazon’s platform has been instrumental in Pawstruck’s growth, allowing the company to scale rapidly without the expenditures that would otherwise be required.
“What Amazon allowed me to do was grow extremely fast and build a sizable business without a bunch of capital needed,” Goguen said. “To grow as fast as we did, I would have had to rent out a huge warehouse, hire a warehouse staff and manage them or hire middle management to manage them.”
For this year’s Prime Day, Pawstruck is particularly excited about showcasing its new high-end, air-dried dog food, which the company launched in December.
The growth of the business that Amazon enabled has also helped Pawstruck get a foothold on the shelves of the eCommerce giant’s rival, Walmart, leveraging the “exposure and legitimacy” that it gained from selling on the online marketplace to win the trust of the more traditional retailer.
“The Walmart buyers, they’re not dumb,” Goguen said. “They go online, and if it’s not a brand that’s a household name, they’re looking at a place like Amazon to see how well it’s doing in terms of rankings and reviews and all of these other things.”
As Amazon gears up for Prime Day, Walmart has its Deals Days coming up Monday (July 8) and running through the 11th, which could prove another (if less widely-shopped) way to acquire new customers.
Collectively, Amazon and Walmart capture a huge portion of consumers’ total retail spending. The PYMNTS Intelligence Whole Paycheck Report, which tracks both companies’ market share across various sectors based on earnings reports as well as data from the U.S. Census Bureau and Bureau of Economic Analysis (BEA), calculates that Amazon secured 10% of overall consumer retail expenditure as of the end of 2023. Walmart, for its part, secured another 7%.
Pawstruck’s growth trajectory has been impressive. From a modest $150,000 in sales in its first year, the company now generates eight figures annually.
Goguen attributes this success to a combination of strategic decision-making and leveraging Amazon’s vast resources, enabling the company to enjoy its sales growth without relying on significant investment and a large workforce
“We could grow quadruple the business or 7X the business in one year,” Goguen said. “Look, Amazon’s making their cut too. It’s not like they’re doing it out of the kindness of their own hearts, but it does really allow you to leverage their infrastructure.”
He cited Fulfillment by Amazon (FBA) as a key advantage in cutting those operational costs as well as the eCommerce giant’s two-day shipping as being a huge help in meeting consumers’ expectations of speed and convenience.
As Prime Day approaches, Pawstruck is poised to make the most of the event, leveraging Amazon’s platform to reach new customers and reinforce its position in the competitive pet supply market.
Looking further into the future, Pawstruck plans to expand further into retail while continuing to innovate with new products while maintaining the brand’s voice.
“We don’t take ourselves too seriously. Essentially, we want to be whimsical, but we also want to be extremely trustworthy,” he said.
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