Tag Archives: Robert F. Moran

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CEO Series: Robert F. Moran

Robert F. Moran
President and Chief Executive Officer, PetSmart

How does the pet retail industry differ from the human retail industry?
First of all — passion. I’ve been in retail for 38 years and prior to coming to PetSmart, we use in retailing passion for the customer. But how can you be passionate about a shirt or a suit or a new coat? … I didn’t really discover passion in retailing until I came to PetSmart. … One of the things we focus on is how do we help pet parents help their pets, who have become members of the family, live long, happy and healthy lives? How can you not get behind that? … We’ve converted our environment not into, “How can I help you sir or help you ma’am,” but “Who are you shopping for today? I’m shopping for Buffy. Well, tell me about Buffy.” … All of a sudden you’re getting a life story and the conversation can go in a million different ways. Through that we’ve asked our store associates to be, pet detectives; find out how we can help, either aspirationally or inspirationally, to take care of some unfulfilled need they may have about a pet who has become a member of the family. … The other side of it is that we have enjoyed over the last 10 years within the pet retailing industry a growth of 5 to 6 percent. Probably the only sector in retailing that has been at that level has been electronics. Even in this recession we’re seeing it dip to 3 to 4 percent. So it’s a great growth industry. … This humanization of pets has really created this growth vehicle, not only for our industry, but for our company. We believe this will go on until about 2020. It’s a great industry to be in. I love the passion and it’s a great place to work …

Has the pet retail industry been able to weather this economic downturn better than the traditional retail industry, and why?
I think what has happened in this recession, which is the worst since the 1930s, is very similar to what happened after 9/11. What I mean by that is that people were sticking closer to home — we call it neighborhooding — they took staycations or no vacations at all, they found ways of not spending money but still having a good time. Pets played a role in that. The only way we suffered was in the housing side. What I mean by that is that there is a high correlation between pet acquisition and new houses. When that went into decline over the past two years that affected our industry. We have not been without problems. Within our industry, the hard goods side, the discretionary goods, the extra toy, the extra bed, the extra collar or leash has been deferred. So we had to find new ways to address the customer needs. I think we’ve been able to do that because of the humanization of pets, because of the neighborhooding, pets becoming, let’s call it, an affordable luxury in a roundabout way. … You’ll find ways to feed the dog, you’ll find ways to feed the cat because they’re members of the family. That’s probably why we’ve been more resilient than the human side.

PetSmart had to make some hard decisions last year in terms of the recession. What were those decisions and how have they helped the company?
Business is very dynamic and it’s always about gaining market share during good times and bad. We made a decision in the recession that cash was king; we had to watch our piggy bank, in a sense. What we ended up doing, because customers were not going to shop as much, we slowed down the number of stores, the number of pet hotels we were building. We also put an intense focus on expense management. … The other thing we did is we invested in the customer experience. A lot of companies didn’t do that. We increased payroll, we put an intense focus on customer satisfaction — the relationship with the customer — because we felt if we did that, as we emerged from this, we would be able to gain and pickup market share. … If you really look at other retailers during this time they cut back on payroll, they cut back on 401ks, they cut back on the quality of the associate life — they actually cut back on the customer quality of life inside a store. We didn’t do that at all.

Going forward, what does PetSmart see in terms of growth within its industry in general and what plans does the company have for the future?
We’re blessed to be in a great industry. We’re in an industry that will probably grow 3 to 4 percent. How do we take advantage of that? Not only can we bring in new customers, but we can also gain market share from some of our competitors. I do see that there will probably be a slow recovery. Now it’s anticipated that we won’t see the spending levels approaching the 2007 level until 2013 to 2014. But there will be a gradual recovery. Within there are opportunities to take advantage of. Customers are always looking for new things — innovation, services that in a sense fulfill some of their unfulfilled needs. … you can create points of differentiation. What frustrates me about retailers is that they don’t look at their point of differentiation for their business. They try to do a lot of “me too, me too,” and sometimes you don’t recognize the industry anymore because everybody is trying to do the same thing.

What advice do you have for someone who wants to follow the career path you made?
I have two things. One is don’t actually map out a career path. Seek out the knowledge and experience and the jobs you really need to work on so you can demonstrate accomplishments. If you do that the career path comes to you, especially if you are successful and are willing to make certain sacrifices along the way, it will come to you. My secondpiece of advice is, and it’s going to sound trite, treat your office as a prison and escape it as much as possible, because not everything is happening here. Everything is happening out there. The more you can roam, the more you can find out what’s going on, the more people you get to know. Early in your career you call it networking, but in networking you find opportunities. You can turn some of your knowledge and experience toward those opportunities. As you get older and start getting accomplishments and you get titles along with it, you find what’s going on and where you can prioritize the needs of the company and the resources of the company, and that becomes very important.

Vital Stats

  • Joined PetSmart in 1999 as president of North American stores.
  • Appointed president and chief operating officer of in 2001.
  • Named president and CEO in June 2009.
  • Former president of Toys R Us, Canada.
  • Spent 20 years with Sears, Roebuck and Company.
  • www.petsmart.com

Arizona Business Magazine

January 2010