Amazon takes bite out of dog food industry with new product line
FBN’s Deirdre Bolton on the release of Amazon’s earnings.
Amazon is taking a bite out of the dog food industry, creating its own product line as it expands its list of private-label brands and further disrupts the retail industry.
The new brand of dry dog food, known as Wag, launched on Wednesday and is available to Amazon Prime customers only. Prime members pay on a monthly or annual basis and receive free two-day shipping, access unlimited music streaming and the online retailer’s own original video series.
Originally Wag.com, the brand was owned by Quidsi – the then-parent of Diapers.com and Soap.com – before Amazon purchased the firm in 2010 for more than $540 million. Amazon shuttered Quidsi last year and today Wag.com redirects to Amazon’s website.
By taking a stake in the market, Amazon threatens such companies as PetSmart and Petco Animal Supplies. The former purchased Chewy Inc., one of the largest American online pet product retailers, last May in a $3.3 billion deal – reportedly the largest-ever e-commerce acquisition.Amazon’s move would also affect other retailers that sell dog food, including grocery stores. Walmart has its own private-label dog food: Ol’ Roy.
Americans will spend more than $72 billion on their pets this year – nearly $30 billion on food alone – according to data from the American Pet Products Association, the trade organization of pet product manufacturers and importers.
Other private-label products sold by Amazon include pet beds, baby products and furniture. An Amazon spokesperson told FOX Business the company will continue adding more offerings without sharing specifics on what the products might be.