Everything comes around. A decade after the Pets.com sock puppet became the symbol of overreaching Internet startups, Amazon-owned Quidsi is launching an online pets supply store today called Wag.com. But before you dismiss this as yet another sign of the bubble, consider how much things have changed in the past ten years.
People are now very used to shopping online, and if the price is right and it can be delivered in two days, why not order a bag of dog food to be delivered to your door? At launch, Wag.com will offer 15,000 pet products—about the same amount you can find in big box pets supply retailer. Over time, that number will grow to 25,000. Orders of $50 will be shipped free.
Another big difference this time is that Quidsi seems to know what it’s doing. It started with Diapers.com, which quickly became the biggest seller of diapers online. Last year, it expanded into drugstore items with Soap.com. And now it is moving into pet supplies (an online toy store called Yoyo.com will be next).
“We have spent many years now honing our back-end logistics,” says CEO Marc Lore. “We have built a logistics backend to sell big, bulky, heavy items and co-mingle them with smaller items and get them in the same box and get them out and ship fast.”
That may be true, but shipping heavy bags of low-margin dog food is exactly what killed Pets.com. Lore notes that “there has definitely been a shift to more specialty, natural and organic foods, so the cost per pound is higher.” But Quidsi’s formula for success has always been to get customers—usually the women shoppers who buy everything in ost households—to come back periodically for staples and then upsell them on higher-margin goods. Wag.com will have plenty of more expensive toys and treats for the pampered pet as well.
And to encourage cross-shopping, the free shipping minimum drops to $39 if you buy from more than one of Quidsi’s sites. There will be tabs taking shoppers to Diapers.com, Soap.com, and BeautyBar.com, where they will be able to keep filling up the same carts and use the same accounts (which are not yet tied to Amazon) . Although it took a while for the Amazon deal to close (it finally did in April), Amazon has been pretty much hands-off. At some point, though, you’d think they could at least link to Diapers.com when someone searches Amazon for diapers.
Here’s a video that explains the company’s logistics and robotic warehouse system: