From “Good Dog” to “VIPP”: How PetSmart’s AI Loyalty Strategy Fetches Results

PetSmart has given its loyalty program, Treat Rewards, a serious upgrade—and AI is doing the heavy lifting. Using machine learning models from Hightouch, the pet retailer now customizes offers based on individual buying habits, from preferred dog food brands to services like grooming. AI also helps determine the optimal timing and sequence for outreach, which led to a 22% bump in offer activations in 2024. With over 90% of transactions linked to a Treat Rewards account, this shift is clearly more than a tail-wagging gimmick—it’s directly tied to bottom-line performance.

The revamped program introduces a three-tier structure—member, bestie, and the top-shelf “VIPP” (very important pet parent)—all based on annual spend. Perks range from points and discounts to freebies from partners like Shutterfly. Membership has grown from 67 million to 75 million since the relaunch. But what’s especially notable is how AI detects both presence and absence: if someone gets their dog groomed but skips buying food, the system flags it and sends targeted offers to close that gap. It’s smart marketing with a sniff of behavioral science.

Importantly, PetSmart hasn’t gone fully robo-pet. Store associates (50,000 of them) still play a key role in educating customers and helping them activate relevant offers. Emotional loyalty also plays its part—like promoting new pet adopters to VIPP status during National Adoption Week. As the pet retail sector holds stronger than others, PetSmart’s blend of AI smarts and human touch is a masterclass in value-driven loyalty marketing—with just the right amount of belly rubs.

Full story at Modern Retail.