People love their pets, and they’re spending more than ever to prove it by making sure their furry family members are well fed.
According to the American Pet Products Association (APPA), U.S. consumers will spend an estimated $58.51 billion on pets in 2014; food sales are projected to comprise $22.62 billion of total expenditures.
“The food category is expected to reach an all-time high in 2014,” Greenwich, Conn.-based APPA says. “Surpassing previous estimated growth in 2013, food sales prove yet again to be consistently increasing, with a growth of 4.5 percent. This category remains the highest-spending segment of the pet industry as pet food trends continue to follow human food and diet trends.”
Health-and-wellness Themes are Hot
Today’s pet food trends mimic those in the general food and beverage marketplace. Consumers are more interested in healthy and organic products, and they’re seeking similarly healthy formulations for their pets’ diets, industry experts note.
“Both food and veterinary care are strongly influenced by consumers’ growing interest in improved health care for their pets,” APPA President and CEO Bob Vetere says. “Health-and-wellness-related themes represent the most powerful trends across all segments of the industry, and will continue to do so again this year.”
Data from a 2014 Packaged Facts pet shopper survey support the APPA’s findings.
Fifty-one percent of U.S. dog owners and 44 percent of U.S. cat owners buy at least one kind of specialty pet nutrition product — and those kinds of purchases are on the rise, information from Rockville, Md.-based Packaged Facts reveals. During a presentation at the APPA’s Global Pet Expo in March and at Petfood Forum 2014, Packaged Facts Research Director David Sprinkle said 41 percent of U.S. dog owners reported purchasing one or more types of specialty-ingredient formulation dog food when the company asked a similar question in 2013, as reported by petfoodindustry.com.
Pet food manufacturers are making sure health-conscious shoppers have choices when it comes to feeding their pets.
Examples abound. Hill’s reformulated its Science Diet as a natural product, Walmart launched Pure Balance as its first natural pet food store brand, Nestlé Purina has come on strong with Purina One Beyond, Merrick acquired Castor & Pollux and obtained organic certification, and Del Monte acquired Natural Balance, according to the July 2013 Packaged Facts report “Pet Food in the U.S., 10th Edition.” “Everyone is stepping up their game to take advantage of the natural boom,” the report noted. “Yet another market driver is the fact that, more than ever, pet specialty and mass-market brands are growing significantly more alike in terms of offerings. In order to differentiate, marketers are turning to trends such as grain-free, ‘meat first’ and human-grade products.”
Product development shows no sign of slowing.
This June, Nestlé Purina will introduce new products in its Beyond line of natural dog and cat foods. The St. Louis-based company says the four dry dog, four dry cat and 12 wet cat formulas “will provide pet owners with all the ingredients they want, and none of the ingredients they don’t want, in their pet food.” All of the dry products include real meat, poultry or fish as the No. 1 ingredient, and no corn, wheat, soy, chicken byproduct meal, or artificial colors, flavors or preservatives.
Beyond dog formulas include Beyond Simply 9, made with real meat as the top ingredient, along with nine natural ingredients, plus vitamins and minerals; Beyond Superfood Blend, made with real fish as the No. 1 ingredient, plus nutrient-rich superfoods; and grain-free Beyond Adventure, made with alternative protein sources.
The Beyond dry cat formulas, which contain only 14 ingredients, include Beyond Grain-Free, with real fish as the No. 1 ingredient, and no corn, wheat, soy, chicken byproduct meal, or artificial colors, flavors or preservatives, and Beyond Superfood Blend, with real fish or turkey as the top ingredient, as well as other nutrient-dense ingredients. The new Beyond Natural wet cat formulas come in 12 flavors in Chunk in Gravy and Paté varieties.
The healthy trend has migrated to the pet treat category, too.
Cranbury, N.J.-based Loving Pets recently launched a new line of all-natural It’s Purely Natural dog treats in nine varieties, and all-natural, single-ingredient Purrfectly Natural cat treats in beef and chicken flavors. According to Eric Abbey, the company’s president and founder, those items illustrate its focus on healthy pet products, something that began with the 2011 launch of Barksters Krisps, low-fat treats made with all U.S.-sourced natural ingredients at Loving Pets’ on-site facility.
Educate Customers to Boost Sales
With the market for healthy pet food on a growth path, supermarket retailers stand to benefit by adding at least some selections for shoppers seeking nutritious options for their pets. Abbey advises retailers to showcase natural items in a separate or highlighted area within the pet food and treat section, but cautions that stores should do more than stock those products to boost sales.
“Pet owners need a retailer’s help when seeking healthy treat alternatives,” he explains. “Educating and encouraging your staff to highlight the differences [between products] is key to helping the consumer find the best options available. Help explain why these treats are beneficial for a consumer to purchase, not only for the health-promoting benefits to the pet, but also for the affordability to the consumer. … Healthy pet treats can remain very affordable.”
Labels are a good place to start the education process. Abbey suggests encouraging customers to look for high-quality chicken or other specific USDA-inspected lean protein sources such as beef, lamb or liver as the first ingredients; he warns that vague meat sources such as “meat and bone meal” or “poultry/poultry meal” contain byproducts. Whole grains are healthier than flours or grain fragments, while brown rice provides more nutrients than rice flour and brewers rice, he adds.
The new TreatFinder at www.LovingPetsProducts.com lets retailers and consumers enter specific criteria — “dog,” “grain-free” and “small size,” for example — to locate a product that fits their individual needs. “Retailers can utilize platforms like this to explore various ingredient combinations available and be a resource to answer questions and make recommendations,” Abbey notes.
Whatever their approach, retailers that want to capture a share of the projected $22.62 billion in pet food sales should explore the best ways to stock pet department shelves.
More than Cats and Dogs
Fish, birds and other small animals fuel pet industry growth.
In 2009, when she was just 10 years old, Katherine Bauhs asked her parents for a pet bunny for Christmas. Although she and her older brother, Jack, already owned a dog named Sugar, parents Tim and Shannon relented. Soon Oliper the rabbit was hopping around the family’s Oak Park, Ill., home.
If your store doesn’t stock food and accessories for pets like Oliper (who nibbles on kale, cilantro, rabbit pellets and timothy hay), you’re missing out on a category that’s growing right along with the popularity of fish, birds and small animals. Today, the pet population in the Bauhs’ house is an increasingly common one, as more consumers opt for pets of the non-canine and non-feline kind.
“There is a lot more to the pet industry than dogs and cats,” according to “Pet Population and Pet Owner Trends in the U.S.: Fish, Birds, Reptiles, and Small Animals,” a report released by Rockville, Md.-based Packaged Facts in January 2013. “While research into the human-animal bond tends to focus on the special relationship between people and dogs that has evolved over thousands of years, today’s pet owners do not limit their connection with animals to dogs — or cats — alone. A wide range of other animals have found their way into the households and affections of pet lovers.”
By the Numbers
According to the Packaged Facts report, 116 million fish, birds, small animals and reptiles are part of Americans’ pet families. Fish tanks can be found in 7.2 million households, bird cages in 4.6 million households, and reptiles in 1.8 million households. Rabbits, meanwhile, “warm the hearts and engage the children of 2.5 million adults,” the report notes.
Considering the spending power possessed by owners of pets other than cats and dogs, retailers that carry food, toys, grooming products and accessories to meet these pet owners’ needs have an opportunity to significantly affect the bottom line.
Demographics can help determine the types of products customers are likely to buy.
Bird and fish owners tend to be young, multicultural, and much more likely to live in apartments, condos or co-ops in large cities, especially in the Northeast. “Marketers will find these Gen Y pet owners to be highly engaged with social media. Bird owners, for example, are 37 percent more likely than the average pet owner to purchase products advertised on a social sharing website and are 24 percent more likely to place greater trust in product information they get on a social sharing website,” the Packaged Facts report says.
Parents and children, as the Bauhs family shows, also play a big role in this market segment. Compared with pet owners who have only cats and dogs, those who own fish, reptiles and small animals are much more likely to have children under the age of 18 in their households.
“Nearly 90 percent of households with hamsters have children, and 87 percent of these have children under the age of 12,” Packaged Facts reports. “Around 60 percent of households with fish, rabbits and reptiles have children under the age of 18. Thus, children and their parents are at the heart of the market for fish, reptiles and small animals, and represent a key factor in the post-recession recovery and long-term growth prospects of the pet industry.”