Dive Brief:
- Chewy executives credited a combination of CX and marketing for a return to customer growth during a Q3 2024 earnings call Wednesday. Chewy reached 20.2 million active customers in its latest quarter, up 160,000 from the previous quarter.
- The pet retailer’s updated mobile app experience, which emphasized convenience, helped create a mid-teens boost in unique customers and average monthly app users compared to Q3 2023, according to CEO Sumit Singh.
- Chewy Vet Care, its in-person veterinary clinics, are also showing promise, according to CFO David Reeder. The six existing locations earned high net promoter scores for their customer service, and more than half of new customers who visit clinics shop online after their trip.
Dive Insight:
Chewy is marrying a better site experience with marketing campaign execution to fuel customer and sales growth. Net sales grew 4.8% year over year in the third quarter, reaching $2.88 billion and exceeding the retailer’s guidance.
“We are continuously rolling out enhancements to our on-site and in-app experiences to ensure we are providing an even more enjoyable and convenient shopping journey for pet parents,” Singh said.
The company is focusing on connecting its marketing funnel to expanded audiences, according to Singh. Once customers are on the site, Chewy’s improved experience and product assortment can help turn interest into purchases.
The retailer has improved its ability to identify and segment existing customers to encourage repeat purchases, sign up for automatic shipments and engage with the mobile app. This will be a key part of the company’s 2025 strategy.
The Chewy+ paid membership program, which offers perks including free returns and 24/7 customer service, is driving sales as well, according to Singh. Chewy+ members place more orders and have greater mobile app engagement than non-members.
The program, which launched in the summer, is young enough that it only offers an “immaterial” contribution to Chewy’s bottom line, according to Singh. However, Singh is encouraged by the early results and looks forward to expanding the program to a broader audience.
“Overall, we're playing a pretty strong playbook, continuing to differentiate ourselves, both in terms of the basics of the category on price and convenience and assortment, but also in bringing new innovations to life,” Singh said.
