Yep, selling pet food online
Pet food online is thriving and growing to about $100M this year according to Forrester in this New York Times story (registration required). Even 40-lb bags of pet food are being shipped by companies but this time they're making sure they charge enough to cover shipping, and the website serves as an online version of their catalog stocking items that are difficult to carry in the stores.
For two years, that category has been held out as the prime example of what went wrong during the dot-com craze. Companies like Pets.com and others helped put a face on the e-commerce lunacy — the face of the Pets.com sock puppet — and inspired lore of missteps like companies' giving away 40-pound bags of dog food, with free shipping.
...Mr. Francis [CEO of Petsmart] said, the company uses the site to sell goods that are impractical to carry in stores, like dozens of varieties of 50-gallon fish tanks. He said about 75 percent of the goods sold on Petsmart.com were so-called hard goods like these, whereas in the stores, those items account for just half of sales.
...Like many dot-com executives of the day, in 1998 Julie Wainwright, who left the defunct online movie e-tailer Reel.com to create Pets.com, cited the $15 billion size of the pet supply industry and suggested that if online retailers could take just a small share of the market, they would thrive. The problem, though, was that few e-tailers understood that dog and cat food represent nearly half of that figure and that such bulky, relatively low-price goods are nearly impossible to sell profitably when shipping to remote customers.
But as the pet supply market continues to grow, the share of nonfood items grows, thus lending some hope to the smaller number of companies now in the online pet supply market. According to a study by the research firm Business Communications, the total market will reach $33.5 billion by 2005, despite a soft economy.
"This is a recession-proof industry," said Colette Fairchild, associate editor for Pet Age magazine, a trade publication. "Even in a big recession, people still buy for their pets. It's an emotional buy."