Big brands are facing fresh challenges from direct-to-consumer upstarts. Here's how Pedigree's parent company is fighting back.

Pedigree

Pedigree parent company Mars Petcare is ready to take on disruptor brands, the company's director of marketing Melodie Bolin said at the Association of National Advertisers' Brand Masters Conference on Friday.
The company is competing with startups by incubating its own brands and with help from its VC Capital Fund Leap.
The company has also acquired smaller brands such as Whistle, which it bought in 2016.

SAN DIEGO — The swift rise of direct-to-consumer upstarts has forced legacy brands to rethink how they run their businesses.

The pet care space is no different, with brands like Bark and Pawpack taking on incumbents like Pedigree and Purina.

Pedigree parent company Mars Petcare is competing with startups by incubating small brands itself, the company's director of marketing Melodie Bolin said at the Association of National Advertisers' Brand Masters Conference on Friday. Last year, for instance, Mars Petcare started a direct-to-consumer nutrition business.

"Big brands definitely have an advantage," said Bolin. "We have the equity, and if we can keep them relevant, authentic and meaningful, we will continue to drive sales through those brands."

These brands don't come out of Mars Petcare's marketing department. They're overseen by a separate, "connected solutions team," whose mandate is to work faster than the rest of the organization has traditionally operated.

Mars has also launched a VC Capital Fund dedicated to "pet-tech" startups. The $100 million fund, called Leap, was launched in 2018, and is focused on fostering companies that do all things pet-related, from nutrition to genetics.

The accelerator program is run with the Michelson Found Animals Foundation and ad agency R/GA's investment fund R/GA Ventures, and aims to innovate in pet technology.

As disruptor brands enter categories from eyeglasses to mattresses, established brands are rethinking their retail and advertising strategies. Several such as P&G and Kraft Heinz are responding with incubation and accelerator programs of their own.

Another way that Mars Petcare is readying itself for the future is by buying disrupter brands. One of the biggest examples in recent years is its acquisition of Whistle in 2016, whose GPS pet tracker helps people track their pet's fitness.

E-commerce has also been an increasing focus for the brand, said Bolin, and would change the game for all brands. She said that the company had "a strong frenemy relationship" with Amazon.

"Figuring out how to stay relevant as a CPG brand in a world where everything is on demand, comes down to the way that you build e-commerce," she said. "When you add the cost of shipping to a 50-pound bag of dog food, you've got a real business problem."

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