The last two years have carved out a significant space for digital services in petcare. Virtual consultations and e-prescriptions have been a lifeline for vet practices facing heavy backlogs of appointments, while those isolating could continue with check-ups.
This move onto digital platforms has seen a growing appetite from pet owners for greater efficiencies in how they communicate with vets. We see the evidence for this in start-ups like PetApp, a virtual booking system, which raised €3.9m in investment last year.
In tandem, there’s been a further spike in the consolidation of small independent practices by larger corporations that have the financial backing to take the reins in digital petcare. One notable recent example was CVS acquiring The Vet Group, which gives it a 30% market share of veterinary services across five UK cities.
The digitalisation of the industry has the capacity to greatly improve experiences in the longer term. However, there has been consumer pushback against this wave of acquisitions. Notably, rising consolidation has run parallel to an increase in complaints around low-quality services, resulting in (for instance) the CMA demanding CVS outlines a revised set of proposals to ensure standards are protected.
A key issue for consumers are face-to-face consultations – or the lack of them – which will always play a fundamental role in veterinary services.
There are benefits to both
There’s significant pressure on larger corporations in petcare, from both investors and new tech-savvy consumers, to show growth. Technology is going to be key in appeasing these demands allowing them to innovate at speed.
A central use case for technology and data, in the first instance, should be making operations more efficient. Making the administrative elements of operations seamless should be a standard expectation across the bigger players, but it’s not yet commonplace across the sector.
Equally, there is still work to be done in a number of other areas, most pressingly in improving personalisation across product recommendations. Owners using petcare tech are more likely to see blanket retargeting suggestions on grooming products (for instance), instead of tailored recommendations.
The technology solutions put in place by the larger players are falling short of the personal touch pet owners valued in community practices. While digital services are an important investment to future proof practices, the tech needs to evolve further and won’t meet the expected standards of customer service in isolation.
This is key. Digital cannot and should not replace face-to-face entirely, each brings particular advantages in driving efficiencies whilst building trust.
Collaboration through data
The main advantage held by the larger corporations is the data they own, moreover this is only increasing as more pet owners make use of digital pet care. The number of potential data points rises as customers turn to browser and app based services, so it becomes easier to identify and analyse trends.
Information around factors such as repeat purchases, frequency of check-ups and of common illnesses at a regional level allows the big players to drive efficiencies and better plan ahead. It also enables individual practices to anticipate and adapt to market conditions such as surges in visits and to thus manage stock in line with demand.
This data can also be used to offer more tailored experiences at a retail level too. Consequently, it would be mutually beneficial for stakeholders across the animal health market, from corporates and independent practices to manufacturers, to share insights that would enable better consumer experiences. But first, all players must learn to trust each other for this to work effectively.
Why it’s time to invest in digital across the supply chain
While sharing data is business-critical to the animal health sector, significant bottlenecks remain across the supply chain making progress slow.
There has been some movement in recent years, but big pockets of the supply chain still operate in silos. Removing fragmented point to point connections by switching to digital supply chain platforms are yet to happen, in part due to global issues, like inflation, pushing digital collaboration down the agenda.
This reluctance to move towards automation hinders access to data pertaining to key information be it inventory levels or the time it takes medicines to reach customers. It also makes it harder to make appropriate case-by-case product recommendations and recall any that are faulty or are subpar of standards.
And in the face of future product shortages, a lack of transparency could mean that businesses can’t automate the auditing of stock levels to streamline supplies when customers need them most. In a worst case scenario this can be a life or death issue. Even when it isn’t, it has a knock on effect, potentially capping the amount a customer can buy and risks denting long-standing relationships.
Investing in the supply chain to make collaboration easier is key to managing customer expectations – and also ensuring that end-users get the services and products they need and deserve.
But the rise in complaints is certainly going to worry the corporates across the board regardless. There’s an increase in demand for digital services from pet owners, but dissatisfaction with the quality of these shows that better personalisation must now be a priority. Success here depends on data-led insights pertaining to the individual care needs of pets.
But personalised experiences also require face-to-face appointments. Independent practices have built their reputations on this and are part of the fabric of many communities thanks to the reservoirs of trust over the course of many years.
Technology and data should be deployed where they genuinely improve services for pet owners, rather than detracting. Whether that’s down to stock management or customer service. The independents and the corporates each offer particular advantages to customers, moving the industry forward will mean taking what’s best from each.
Making that work will mean closer collaboration between all parties around data. Collaboration and engagement are key to success here – for many this is a mindset change businesses must go through. Clearly there are still significant challenges to address, but it’s worth the effort as everyone wins.