Petco scoops up subscription service Pupbox

Dive Brief:

Petco on Wednesday announced it has acquired PupBox, a puppy- and "life stage-focused" subscription service aimed at new puppy or dog owners, for an undisclosed amount. Each box contains customized products and training information based on a pet's stage of development and physical characteristics.
Alongside the acquisition, Petco and PupBox said they've launched a PupBox Holiday Box, customized based on pet size, which will feature seasonal favorites selected by the PupBox and Petco teams, according to a company press release. A one-time box is $39, although the price edges down with more frequency: A three-month subscription is $34 per month, a six-month subscription is $32 per month and a year's subscription is $29 per month.
PupBox was co-founded in 2014 and was featured on ABC's Shark Tank in November 2016, which garnered funding from investor Robert Herjavec. Co-founders Ben and Ariel Zvaifler, as well as other PupBox employees, will join Petco.

Dive Insight:

Despite lingering unknowns about their long-term profitability or longevity, subscription services have heated up as of late, with apparel companies in particular launching new ventures. The model is nothing new in pet supplies — Target recently scooped up the standout in the market, Barkbox, with a partnership that brings that brands' goods into Target stores.

Pupbox puts a twist on the subscription platform with its focus on puppies — fast-growing and in need of training — which allows the company to provide a steady stream of new collar sizes, play toys and training advice. The Pupbox service can be curated for adult dogs as well, though.

Animal experts once frowned upon the idea of presenting a new pet at the holidays, but that's changed — provided a family is well prepared to bring in a furry family member. Enter: a subscription like Pupbox, which helps focus pet owners on the needs of the animal in their home (not to mention that it keeps money coming in for the retailer). Each box includes a bag of training treats and four to six other products selected based on the puppy's age and physical characteristics, according to Petco. If a pup is working on house training, Pupbox will include pee spray; if the pup is teething, customers get extra chew toys. Plans renew automatically and can be canceled at anytime.

"We're thrilled to bring PupBox to an established industry leader like Petco, and excited to aggressively expand our current offerings together, while helping pet parents and the pets they love," PupBox CEO Ben Zvaifler said in a statement. "Our values and drive to make pet parenthood easier are perfectly aligned; and we're ready to help even more new pet parents spend less time worrying about what they need as their pets grow and more time soaking up all the puppy love.”

Pet supplies subscriptions may be in a sweet spot in subscription retail — with enough replenishment-fueled demand yet not too much interference from highly personalized and swiftly changing needs. Still, the model has yet to prove itself when it comes to customer retention and profits.