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Chewy $CHWY Unlocked the Secret to Brand Loyalty

July 27, 2022

Brand loyalty is declining.

As consumers juggle product availability, inflated prices, and ever-expanding digital access points, they’re less likely to remain loyal to a brand or retailer.

Unless that retailer unlocks a key driver of customer retention: a personal touch.

Research from McKinsey found that 71% of consumers expect companies to deliver personalized interactions – and 76% get frustrated when this doesn’t happen.

One company on our radar has mastered the art of establishing brand loyalty through personal connections…and it could pay off HUGE long-term.

Here’s why we’re Bullish on Chewy (CHWY)

Chewy is Building (and Maintaining) a Loyal Customer Base

The pet Supply delivery company Chewy (CHWY) stands out as a niche eCommerce player that’s still thriving post-COVID.

In the current quarter (ending 7/31), Chewy Mentions are on pace to reach their highest volume since the 2020 COVID surge: +17% QoQ and +33% YoY.

Social Buzz surrounding the company is booming, a sure sign that CHWY is still actively growing its footprint.

But that doesn’t tell the whole story.

Chewy is a subscription-based service, meaning that growing brand awareness and adding new customers are only part of the equation— Subscriber Retention is equally critical for the company’s long-term success.

Chewy has a winning strategy when it comes to subscriber retention: Endearing itself to customers and building brand loyalty through above-and-beyond service.

CHWY’s extremely high Consumer Happiness exemplifies this phenomenon:

At 85% Positive Chewy ranks among the most-beloved brands within the entire LikeFolio coverage universe…And Happiness is rising, up +6% YoY (90d MA).

Chewy boasts top-of-the-line customer service, but it’s the “unnecessary” gestures of kindness that truly push it to the next level — Seemingly insignificant acts of kindness that serve to create an intimate relationship with its customers:

And to top it all off, consumer purchasing trends look favorable.

Mentions of ordering pet supplies online, including food and pharmacy products, are trending +23% YoY on a 90-day moving average.

Although pet supplies represent a relatively niche sector within the rapidly expanding world of eCommerce, consumer demand is growing, and more importantly, CHWY is the undisputed leader in the space...


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