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How Chewy Builds an Emotional Relationship With Customers

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Bereavement cards and pet portraits are part of Chewy's special way of winning over pet owners.

Chewy (CHWY -1.36%) has emerged as a leading pet products retailer, and a main reason for that is the strength of its customer relationships. More than a typical e-commerce platform, Chewy builds relationships with customers in unique ways.

In this segment of "Upgrade or Topgrade," recorded on Oct. 15, Fool contributors Parkev Tatevosian and Millionacres Editor Deidre Woollard discuss Chewy's approach to pet owners and how that has made it a winning stock.

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Parkev Tatevosian: Interesting, you point that out. Right along Halloween, what about dog Halloween costumes? Oh my goodness. You mentioned, the humanization of pets is certainly something that's fueling this growth in pet spending. We're increasingly treating our pets more like we treat members of our family. Give them the best food, change their food, give them cloths and change their beds, give them new toys and all of that stuff that goes along with it.

Deidre Woollard: Well, and I think that's one of the things that Chewy has done really well, with their marketing campaigns is always of providing new ideas for people. I think that they've really tapped into that idea about the pet parent as someone who is really focused on what their pet needs. Oh is my pet bored? Is my pet going to need more toys if I go back to the office a few days a week? What else is my pet going to need? Do I need to have my pet blood checks? What behavior is my pet doing? I think that Chewy has done really well with that. I think one of the things that they did early on that was really charming was those Chewy pet portrait things where they had the artists and the pictures of your pet, it seems like a silly thing, but it's a very soft touch personalization made people feel like the company really cares about their pets and I think that's one of the things that Chewy has done really well and that leads to consumer loyalty, which I think is really a big challenge for them now going forward that people are going back to the grocery stores and things like that.

Parkev Tatevosian: Right. I think you touched upon a strong advantage of Chewy there with that connection with customers and having those data points being an e-commerce retailer. For instance, imagine, let's say you bought your pet Chewy toy and maybe the last time you bought your pet a Chewy toy was four months ago. Now Chewy has that data and they can send you an email reminding you, "Hey the last time you bought your pet a Chewy toy has been four months it might be time to replace that and add another one to your basket." Whereas physical Brick-and-Mortar store won't have that connection with these customers.

Parkev Tatevosian owns shares of Chewy, Inc. The Motley Fool owns shares of and recommends Chewy, Inc. The Motley Fool has a disclosure policy.

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