Pet Care Category Grows to $75B
Customers continue to spend more on their pets every year, but shopping behaviors and product trends continue to change. This is according to a new report from Acosta, "Pets Are Big Business," which finds that one in five pet owners has changed their buying behaviors for convenience.
In the past year, grocery retailers have increased their pet food sales by 5%, while pet retailers saw a decline of 1.7%. Acosta attributes this shift to two primary factors:
- Premium brands have entered grocery stores, making it more convenient for pet owners to purchase food there and saving them an extra trip.
- Pet food prices at grocery retailers are often comparable to, or lower than, pet retailers.
E-commerce is surging, with 54% of Millennials purchasing food and supplies for their dogs online in the past year, and 45% of Millennials doing so for their cats. Online penetration, however, is still low at 9%, although it will be interesting to see whether COVID-19 has an impact on these numbers in the coming year.
"Pet care is a rapidly growing $75 billion industry, with pet food sales up more than 6% versus last year," said Colin Stewart, EVP, business intelligence at Jacksonville, Fla.-based Acosta. "With this growth, we're seeing spending behaviors shift to reflect more hassle-free buying options and more interest in healthy options for their pets that include real, natural ingredients. As pet ownership continues to soar, retailers should capitalize on industry growth by honing in on their competitive advantages and competing from all directions — price, assortment and convenience."
The report also looks at pet ownership and pet care from a generational standpoint. The top reasons for Millennials to change where they shop for their pets include convenience (49%), price (31%) and assortment (17%). No generation, however, is completely brand loyal, with 32% of dog owners reporting that they shop at four or more retailers.
Pet ownership is most common among Millennials and Gen X, with 59% of households owning at least one dog. Millennials are the generation most likely to own multiple dogs (42% of households), while Gen X is most likely to own multiple cats (53% of households).
Acosta's "Pets Are Big Business" report was compiled using industry data and proprietary information sources, including online surveys of the company's proprietary shopper community, conducted prior to the COVID-19 pandemic.