Global Pet Care Industry
Domestic pets are taking up an increasingly important place in households worldwide. Pet owners are spending more and more on pet care across a range of sectors, including pet health, food and toys. According to the 2011-2012 American Pet Products Association National Pet Owners Survey, more than 60% of homes in the US have a pet, or close to 73 million households.
Cultural attitudes toward owning pets mean that domestic animals are viewed more and more as members of the family. Pet care spending was little affected by the economic recession, with owners cutting corners elsewhere rather than reducing their pet care budgets.
Pet ownership in the US is at an all-time high, leaving room for market growth. Not only is pet ownership climbing, but spending per pet is also on the rise, with owners splashing out on basic products such as food, but also on more sophisticated products and services, like grooming and accessories.
Key Market Segments
- The global animal health industry involves antibiotics, anthelmintics, vaccines and medical feed additives. The leading segment in the animal health market is represented by pharmaceuticals such as anti-infectives and parasiticides, reports Koncept Analytics. Vaccines are the second-leading market segment.
- A trend towards preventive health practices will fuel vaccine market growth. The Americas and the EU dominate the global pet health market. US pet health spending is forecast to reach $33 billion in 2014, according to Freedonia. Demand for pet health products and services from manufacturers is expected to record yearly growth of close to 6%, hitting close to $6 billion in 2014.
- The world pet food market is expected to be worth almost $96 billion by 2017, according to Global Industry Analysts. The market is fuelled not only by a growing pet population but also by increased spending per pet. The EU dominates the global market, fuelled by demand for health-oriented products and treats aimed at specific types and ages of pets.
- Asia-Pacific is recording the fastest growth in the pet food products market, with a yearly rate of 9% through 2017. Market growth is driven by healthy products, innovation, and shorter product lifecycles in developed markets like Japan and South Korea, while price and value for money fuel growth in less-developed markets such as India, China and Vietnam.
- Industry-level interest in the pet food sector points to its potential. KKR was part of a group of investors to acquire Del Monte for close to $5.5 billion in 2010, while Procter & Gamble/Iams took over Natura, a holistic pet food maker. Also, Nestlé Purina acquired Waggin’ Train, a pet treat maker, in the same year, notes Packaged Facts. Private equity firm Wind Point Partners also acquired Petmate in 2011, while smaller outfits continue to receive capital infusions.
Regional Market Share
- The US pet care market was worth close to $51 billion in 2011, reports the American Pet Products Association. Food was the leading segment at close to $20 billion, followed by veterinary care, which exceeded $14 billion, and medicine at over $11 billion. Pet services such as grooming and boarding generated close to $4 billion in 2011, and live animal purchases exceeded $2 billion.
- The Southeast Asian pet care market is growing faster than any other regional market. According to Euromonitor International, the region will surpass $1 billion by 2016. Market expansion will depend on the ability of companies to devise effective marketing strategies to attract first-time consumers to the market.
- In India, a growing number of pet shops are fuelling pet product market growth. Veterinary clinics are also representing a growing source of sales, reports Euromonitor International. Grooming products represent a market segment with good potential as pet owners are spending more on pampering their pets. Companies exporting to India include Furminator, Plush Puppy, Karlie and Isle of Dogs.
An aging population and declining birth rates have led to a different cultural attitude toward pets, which are increasingly regarded as family members. Moving forward market trends in the sector will reflect those in other sectors, with green products and health products witnessing strong growth.
Product innovation in the pet care market will continue to reflect the changing place of animals in the home with personalized food bowls, monogrammed sweaters and Halloween costumes becoming popular ways to humanize pets.
Leading Industry Associations