That the 10 companies profiled here led the petfood industry
in 2005 is no surprise to anyone. After all, the members of
this top group don't change much from year to year; typically
only mergers and acquisitions affect who the players are and
their position in the rankings.
But what about the stories behind the rankings and numbers?
How have these companies achieved their elite status?
Dominating the market-again
In 2005, the most recent year for which complete data were
available at press time, global dog and cat food sales amounted
to US$42.1 billion, according to Euromonitor International. As
in past years, Mars Inc. and Nestlé SA dominated that market,
grabbing 25.2% and 23.7% shares, respectively.
Both figures reflect slight declines, even with the Mars
percentage including the share for S&M NuTec LLC, the maker
of Greenies treats acquired by Mars in 2006. But in terms of
value (retail sales), both major players showed growth, driven
by an increasing commitment to the premium segment, says
Euromonitor in its November 2006 report, the World Market for
Pet Food and Pet Care Products.
"The two leading players … have established a truly global
presence," the report reads. "Broad brand portfolios, with a
strong focus on mid-priced and economy brands distributed
through mainstream grocery channels, have enabled the companies
to build a strong consumer base in both developed and emerging
markets. Indeed, the two companies have been instrumental in
driving the development of dog and cat food sales in emerging
regions through their extensive distribution networks and
aggressive marketing activity."
After Mars and Nestlé, market share and retail sales dropped
significantly to number three Procter & Gamble Co. with its
Iams and Eukanuba brands. It was followed closely by
Colgate-Palmolive, parent company of Hill's Pet Nutrition.
Both companies have also achieved a global presence,
Euromonitor says, but their focus on superpremium petfoods
means their sales and growth lie mainly in developed markets
more likely to have consumers with purchasing power.
Fortunately for Iams and Hill's, such consumers have continued
to trade up to more expensive foods for their pets.
At number seven, Nutro Products Inc. also increased sales
due to its superpremium products, mainly in its US base. In
between, Del Monte Foods Co. came in at number five and
Agrolimen SA at number six. Agrolimen enjoyed the largest sales
increase from 2004 of the top 10 manufacturers, riding
geographic ex-pansion in its native region, Western Europe.
Rounding out the top 10 were three Japanese companies:
Unicharm Corp., Nisshin Seifun Group Inc. through its Nisshin
Petfood division and Nippon Flour Mills Co. Ltd. through its
Nippon Pet Foods. As the world's second largest market for pet
products (behind the US), Japan saw significant growth thanks
to pet owners' increasing interest in the nutritional value of
petfoods, functional foods and human-style products, according
to Euromonitor. However, the three companies profiled here had
flat or declining shares of the global market.
A growing and
Table 1 includes 2004 and 2005 market shares and retail
sales for the top 10 companies. The 2005 retail figure is
repeated in the profile of each company in this article, but
we've also included 2006 data where available.
Table 2 lists petfood company leaders in growth, while Table
3 (p. 20) lists innovation leaders as measured by new product
development. Obviously, these two areas go hand in hand.
Most experts predict the petfood industry will continue to
grow worldwide through at least 2010. Though growth is expected
to be more sluggish in developed regions, it will continue
because of ongoing trends affecting product development-more
people treating their pets like human family members, higher
disposable incomes and a desire for convenience, including with
In emerging markets, such as Eastern Europe, Latin America
and China, growth is exploding and should continue at a rapid
pace. As consumers in these markets increase their purchasing
power, they are more likely to place value on pet nutrition,
thus transitioning from table scraps and homemade meals to
prepared petfoods. Simultaneously, petfood companies are
expanding distribution into these areas, as are pet-related
All this promises a positive future for the entire industry,
including the 10 leaders. Read on to find out what they're
doing to shape that future for themselves.
Inc. (Mars Petcare)
World headquarters: McLean, Virginia, USA Approx. 2005
global retail sales: US$10.26 billionOfficers: Doug Cahill,
president, Mars Petcare USTop brands: Pedigree, Whiskas,
Waltham, Cesar, Sheba, KitekatNew products: Pedigree Super
Chew, GreeniesWebsites: www.mars.com; www.waltham.com;
Mars operates three core businesses (snack food, pet care
and main meal food) in most parts of the world. Acquisitions
was the name of the game in 2006, as Mars acquired S&M
NuTec, maker of popular pet treats sold under the Greenies
brand, and Doane Pet Care Enterprises Inc., previously known as
the world's largest supplier of private label petfoods. Doug
Cahill, president and CEO of Doane, was chosen to run Mars'
North American pet care business in Nashville, Tennessee, USA,
where Doane was headquartered. In late March 2006, Doane
reported sales of US$991.6 million for fiscal year 2005, down
5.7% from a year earlier. Doane's European business was sold to
In the past year, a new easy-to-digest version of Greenies
was released for adult dogs to help clean teeth and freshen
breath. According to Mars, the formula is based on
patent-pending science rooted in dog biology.
Nestlé SA (Nestlé
World headquarters: Vevey, SwitzerlandApprox. 2005 global
retail sales: US$9.65 billionOfficers: W. Patrick McGinnis,
CEO, Nestlé Purina PetCare; Terence Block, president, PetCare
NA; Rock Foster, CFOTop brands: Purina, Friskies, Alpo,
Beneful, Fancy Feast, Mighty Dog, Pro Plan, Beggin' Strips,
Busy Bone, Bakers, Felix, Winalot, Go Cat, Gourmet Gold, Vital
Balance, VitalifeNew products: Beneful Prepared Meals, Fancy
Feast Elegant Medleys, Purina ONE Natural Blends, Naturals by
Purina Cat Chow brandWebsites: www.nestle.com;
During the first nine months of 2006, net sales for Nestlé
amounted to US$5.69 billion (CHF72.2 billion), an increase of
9.1% over the same period in 2005. The PetCare segment achieved
6.9% organic growth. PetCare category sales were US$4.36
billion (CHF5.53 billion). Growth in North America continues to
According to Keith Schopp, vice president of public
relations, the company's keys to growth include innovation
based on humanization and a focus on the consumer. Growth was
also strong in Europe, with strategic brands such as Bakers,
Purina ONE, Gourmet and Beneful doing particularly well.
Many successful new products were launched by Nestlé Purina
in 2006. One of the most innovative was Beneful Prepared Meals,
a new family-style food for dogs with such eye appeal that it
warranted innovative packaging to clearly show the product on
the store shelf.
Nestlé Purina also released natural products, plus Fancy
Feast Elegant Medleys wet cat food in a shelf-ready tray pack.
This packaging eliminates the need for single-can stocking and
improves the shopping experience, according to Nestlé.
World headquarters: Cincinnati, Ohio, USA (P&G Pet Care:
Dayton, Ohio, USA)Approx. 2005 global retail sales: US$2.82
billionTop brands: Eukanuba, IamsNew products: Iams Smart
Puppy, Iams Small and Toy formulas, Slow-Cooked can
recipesWebsites: www.pg.com; www.iams.com;
As a company, Procter & Gamble (P&G) had net sales
of US$68.2 billion in the year ending June 30, 2006. This value
was an increase of 20% versus the same period last year. The
major brands produced are Iams and Eukanuba. Both brands
include superpremium dog and cat foods and treats, with Iams
sold worldwide in most channels (including grocery and mass
merchandisers), while Eukanuba is sold exclusively in pet
specialty stores and veterinary clinics in North America.
Net sales for the global business unit that includes the Pet
Health, Snacks and Coffee segments were US$4.38 billion for the
year ending June 30, 2006. This is 6% of P&G's company
sales, which was up 2% from the same period last year. Sales in
Pet Health were down slightly due to strong competitive
activity in North America and Western Europe, according to the
company's annual report.
World headquarters: New York, New York, USAApprox. 2005
global retail sales: US$2.54 billionOfficers: Robert C.
Wheeler, CEO, Hill's Pet Nutrition; Neil Thompson, president,
Hill's International; P. Justin Skala, president, Hill's North
AmericaTop brands: Hill's Science Diet, Hill's Prescription
DietWebsites: www.colgate.com, www.hillspet.comMain
plants/facilities: five facilities, plus more than a dozen
offices worldwideNumber of employees: 2,500, more than 170
Founded in 1939 by a veterinarian, Hill's Pet Nutrition has
been part of the global consumer goods powerhouse
Colgate-Palmolive since 1976.
According to Colgate's 2005 annual report, Hill's increased
unit volume by 4% that year and sales and operating profit by
6%. It did this via product innovation, including large breed
and small bites extensions of its Science Diet Lamb & Rice
Recipe line and Prescription Diet Canine j/d, based on the
science of nutrigenomics. Data from Datamonitor show
Colgate/Hill's ranking 14th globally in new product launches
from 2003 to 2006 (Table 3).
Through the third quarter of 2006, Colgate reported all five
of its operating divisions-pet nutrition, plus four geographic
divisions of its oral, personal and home care
products-experienced sales and profit increases. This was
supported by record advertising spending, according to the
Colgate's World Fact Sheet on the company website.
Robert Wheeler, CEO of Hill's, expects growth and new
product development to continue not only for his company but
also the petfood industry in general. "We will see the pace of
product innovation continue," he told Petfood Industry last
year. "As we learn more about the benefits of good nutrition,
we will see an increase in products designed to keep pets
World headquarters: San Francisco, California, USAApprox.
2005 global retail sales: US$1.43 billionOfficers: Jeffrey M.
Watters, senior VP, pet productsTop brands: 9Lives, Cycle,
Gravy Train, Kibbles 'n Bits, Nature's Recipe, Reward, Skippy,
Meow Mix, Alley Cat, Milk-Bone, Jerky Treats, Meaty Bone,
Pounce, Pup-Peroni, SnausagesNew products: Meaty Bone Denta
Delicious, Snausages Roverolis, Canine Carryouts Pizza flavor,
Kibbles 'n Bits Brushing BitesPlant locations: Bloomsburg,
Pennsylvania, USA; Lawrence, Kansas, USA; Decatur, Alabama,
USA; Buffalo, New York, USAEmployees: 7,500
As a result of recent acquisitions, Del Monte has added the
Meow Mix, Alley Cat and Milk-Bone brands to its pet products
portfolio. Del Monte also produces private label petfood
products. The company has market shares of 8.8% in the dry dog
food category, 7.3% in wet dog, 4.5% in dry cat food, 19.6% in
wet cat food, 38.8% in the chewy dog snack category, 11.8% in
the biscuit/crunchy dog snack and 20% in the cat treats
category. During fiscal 2006, Wal-Mart was Del Monte's top
customer, representing approximately 30% of the company's gross
sales and an even higher percentage of sales for the pet
Pet products are primarily manufactured at four of Del
Monte's production facilities, located in the US and American
Samoa. The company also uses a limited number of third-party
co-packers and re-packers located in the US and Thailand to
supplement production capacity. The company operates a R&D
facility in Terminal Island, California, USA, where it develops
product lines and researches products for the petfood
World headquarters: Barcelona, SpainApprox. 2005 global
retail sales: US$562 million Officers: Carlos Argenté, CEO/VP
marketing; Franc Andreu, operations managing director; Francesc
Blanch, VP R&D ; Patricia Larumbe, VP business
developmentTop brands: Affinity, Ultima (UK), Rubadub
(snacks/treats), Brekkies, Brekkies Excel (cat), Advance,
Advance Veterinary DietsNew products: Ultima, Advance Special
Puppy Care, Advance Sterilized (12 new dog foods, 10 new cat
foods, three new snack/treats)Websites:
www.affinity-petcare.comPlant locations: one plant in Spain,
two in FranceEmployees: 720
Affinity offers a wide range of products, from special
veterinary diets to superpremium foods. Despite its size, the
company distributes its products within a limited area
geographically, mainly the European Union (EU). Affinity
operates in the EU as if it was a single country. This
facilitates a limited cost structure and greater visibility to
its customers, competitors and consumers.
Affinity is focused on organic growth in the EU. It is
looking to expand selectively in markets with good potential.
The company sees future growth opportunities through increased
distribution. In the countries where Affinity is not a leader,
increased advertising support is helping brands launched during
the last three years to gain awareness and recognition with
In 2006, Affinity introduced 12 new dog foods, one new
treat/snack product for dogs, 10 new cat foods and two new cat
treats/snacks. A new brand, Ultima, was introduced to the UK
market as Affinity's superpremium brand in the grocery channel.
It is currently the third best-selling dry dog product in the
grocery channel and is closing the gap as the second
best-selling dry cat product in this channel.
According to Carlos Argenté, CEO/VP of marketing, "We strive
to be known for taking care of the well-being of dogs and cats.
In relation to our trade partners, we strive to be known for
innovations and value creators. Where we are not leaders, we
would like to be perceived as the challengers in the
World headquarters: City of Industry, California, USAApprox.
2005 global retail sales: US$536 millionOfficers: David Kravis,
CEO; Mike Satterwhite, executive vice president; Ladd Hardy,
senior vice president, marketingTop brands: Max Dog, Ultra Dog,
Max Cat Gourmet Classics, Natural Choice CompleteNew products:
Ultra Large Breed dog food, Ultra Small Breed dog food, Natural
Choice Whole Brown Rice & Lamb Senior dog food, Natural
Choice Healthy Desserts dog treats, Natural Choice Small Bites
Lite and Senior dog food, Max Cat Gourmet Classics
www.ultraholistic.comMain plants/facilities: Victorville,
California, USA, and Lebanon, Tennessee, USA
Celebrating its 80th anniversary in 2006, privately owned
Nutro Products Inc. has staked its success and continued growth
on a commitment to the pet specialty channel. "Nutro creates a
true partnership with pet specialty, working hard to provide
retailers with the tools necessary to compete in a crowded
marketplace with the best combination of people, products and
marketing programs," says Margaret Goodall, director of
marketing. "We work hard to help bring consumers into pet
specialty stores, we educate store employees to speak
knowledgeably about our foods, and finally, we make foods that
perform, so consumers will continue to come back for more."
Other keys to growth cited by Goodall include using
all-natural ingredients, making foods that pets enjoy and
thrive on and staying abreast of research. New products from
the company reflect all these elements, she says. For example,
new small bites formulas are for dogs and cats that prefer a
smaller kibble size, and large-breed dog foods provide for the
different nutritional needs of specific breeds of dogs. Nutro
also introduced what Goodall calls a unique system with omega-3
and omega-6 fatty acids.
With its focus on one channel, the company always finds it a
challenge to help bring consumers into pet stores, Goodall
says. "Consumers are often swayed by the convenience of buying
their pet foods at grocery stores. It is our job to educate
them that pet specialty retailers continue to carry foods that
use better ingredients and provide better performance," she
Despite that challenge, Goodall says the company continues
to outperform the average industry growth rate each year and
expects continued strong growth for 2007, especially in its cat
and holistic brands. "We believe cat owners are turning more
and more to superpremium foods that provide their cats with
superior nutritional value and performance," she says. "We have
also seen a growing trend toward holistic foods for pets. We
introduced our Ultra brand in 2004 to begin to meet the needs
of this market. In 2006, Ultra began to really take off, and
our expectations for 2007 are for us to continue to build our
World headquarters: Tokyo, JapanApprox. 2005 global retail
sales: US$317 millionOfficers: Toshio Takahara, chairman;
Gumpei Futagami, president/CEOTop brands: Aiken Genki Gin no
Sara; Neko-Genki Silver SpoonNew products: Ginno Sara for dogs
7 years and older, Fukkura Dry dog food, Ginno Spoon Umino
Gourmet cat food, Ginno Spoon Can cat foodWebsite:
www.uc-petcare.co.jpMain plants/facilities: Itami Hyogo
(petfoods) and Mie (pet care products)Number of employees:
On a new product tear since 2003, Unicharm PetCare Corp. is
a division of Tokyo-based Unicharm Corp., maker of baby,
personal and hygiene products. In 2005 and 2006, the pet
division continued its product development blitz with at least
four new products, including extensions of lines that have
captured 33% market share for gourmet dog and cat foods.
To what does the company attribute this rapid growth? "We
believe the key for growth is product development meeting needs
in line with trends," says Gumpei Futagami, president/CEO of
Unicharm. He explains that this focus also helps the company
add value to existing products.
Unicharm differentiates itself from its competition by
adhering to a firm strategy of researching consumer needs,
conducting in-depth analysis to convert those needs into
products, increasing the awareness of the products via
marketing and advertising, and expanding sales. "We have
accumulated and analyzed consumer data for the past 20 years
and have been carrying out consumer tests," Futagami says. "For
food we have an independent R&D team inside our factory,
and we emphasize speed in converting needs into products. In
terms of technology, recent palatability enhancing technology
applied to our gourmet petfoods is unique."
Futagami says Unicharm has grown 13-14% annually since he
became president in 2001, and he expects continued growth.
World headquarters: Tokyo, JapanApprox. 2005 global retail
sales: US$217 millionOfficers: Osamu Shoda, chairman of the
board; Hiroshi Hasegawa, presidentTop brands: Run, Carat,
LovelyNew products: JPStyle dog foodWebsites: www.nisshin.com,
www.nisshin.com/english/english36.htmlPlants/facilities: 21 in
Japan, Canada, US, Belgium, Germany, Netherlands, Singapore,
Thailand, Indonesia, China
Under the Nisshin Seifun Group umbrella, Nisshin Petfood
Inc. markets to predominantly Japanese pet owners. The parent
holding company, which traces its roots in Tokyo to 1901,
oversees other businesses as diverse as flour milling, foods,
animal feed, pharmaceuticals and engineering.
In developing its petfood products, the company cites
Japanese cultural trends such as an aging population and
increasing single-person households. "For many, their pet is
now an important member of the family and a life partner with
which they have an emotional bond," according to the Nisshin
website. The company keeps this "new level of emotional
attachment in mind" with its product lineup, which includes Run
dog foods, Carat cat foods and Lovely foods for small pets.
To capitalize further on the cultural changes, Nisshin
launched a premium dog food, JPStyle, in February 2006, via
mail order. The new product has contributed to increased dog
food sales and is the centerpiece of a new company focus on
premiums. Sales have also risen significantly for cat food,
particularly dried and pouch products and foods for older cats,
according to Nisshin financial statements.
In addition to products, Nisshin Petfood provides a pet
advice and consultation service to its customers, which also
allows the company to gather up-to-the-minute feedback on pet
World headquarters: Tokyo, JapanApprox. 2005 global retail
sales: US$183 millionOfficers: Hiroshi Sawada, chairman and
CEO; Masataka Horikawa, director and vice chairman; Wataru
Aosaki, president and COOTop brands: Nippn, Vita-OneWebsites:
http://e-nippn.comPlants/facilities: 12 plants plus seven
offices in Japan, one mill in China, two mills plus one office
in Thailand, three facilities in US
Also headquartered in Tokyo, the 110-year-old Nippon Flour
Mills Co. Ltd., which claims to be the first industrial flour
milling company in Japan to introduce western-style machinery,
manufactures dry dog and cat foods under Nippon Pet Foods Co.
Ltd. (NPF Japan). Besides petfoods and flour milling, Nippon
manufactures and sells food ingredients; processed, frozen and
health foods; and cosmetics. Most fall under the corporate
Key to the company's success and competitive edge is its
research and development. "NPF Japan has its own R&D center
where 100 dogs and cats are bred," states the company's
website. "Appetite, discharges and physical conditions are
being monitored to collect effective data in developing safe
and quality dog and cat foods."
The company also takes pride in its advanced manufacturing
methods, claiming to have become, in 2001, the first petfood
manufacturer to be certified to ISO 9001 (the international
quality management standard). Though Nippon operates globally,
its petfoods are marketed mainly in Japan. Company financial
statements say sales of petfood products have increased
greatly, though Euromonitor numbers show a sales decline in
2005. The company credits the rising number of pet lovers in
Japan for growth. "Keeping pets has a positive effect on
people, and the market for pet products is expanding," reads
the financial statement.
The company builds on its boutique business with three new lines for pet stores, including baked dog food and treats
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