The US pet market continues to remain resilient, despite the
uncertainty stemming from the global economic collapse that
began to make headlines in October 2008. American consumers are
monitoring their spending more closely than they have in recent
petfood sales are holding relatively
Packaged Facts, in a recent report US Pet Market Outlook
2009-2010: Surviving and Thriving in Challenging Economic
Times, views it as a given that consumers across virtually all
industries will be demanding greater value in the products they
buy, exploring less expensive options including private labels
and self-care approaches, and consolidating shopping trips to
save gas. (
Some manufacturers and retailers may also start to feel the
pinch-Central Garden & Pet reported a 7% decline in net
sales during the first fiscal quarter of 2009 (ended December
27, 2008), for example.
Other economic indicators - job losses, the financial/credit
crisis, the housing market and high levels of personal debt -
are all major components driving petfood consumer's purchasing
So if consumer confidence is at an all-time low, why this
relative recession resistance for the pet market? According to
Packaged Facts data:
- Total US retail sales rose 1.4% in 2008;
- PetSmart posts 8.4% sales increase in fiscal year
- Del Monte grows net pet product sales 15.1% in third
quarter of fiscal 2009 (ending May 3);
- Hill's increases revenues 13.5% in fourth quarter
- VCA Antech posts 6.7% revenues growth in 2008; and
- PetMed Express reports 16% increase in net sales in
According to the same report,
total US retail sales are projected to
decrease 0.5% in 2009
. Although it will be the first decline for the industry in
three decades, it's a miniscule plunge compared to other
Two key factors are keeping the pet market afloat - pet
humanization and premium demographics, says Packaged Facts.
Premium demographics account for over half of all pet market
spending. The growing clout of this group matters not just
because it shows that marketers fielding higher priced, upscale
and luxury fare are handily hitting their demographic mark, but
also because higher-income consumers are in a better position
to weather the economic downturn.
In many cases, these more affluent consumers are also the
same better educated consumers most likely to read labels and
pay attention to health claims, and to therefore appreciate why
many higher priced products and services are worth the extra
dollars in terms of potential pet health dividends.
Fueled by these factors, the US pet market is enjoying a
momentum not likely to cease anytime soon, although Packaged
Facts believes that the down economy will temper annual sales
gains during the next one to two years.
Compared with most established consumer packaged goods (CPG)
markets, the pet market's 6%-7% rate of growth during the past
five years is well above average. This momentum is largely a
function of demand for better quality products.
Challenges and new opportunities both will remain the two
most important things to tackle during the rest of 2009.
Manufacturers need to consider balancing issues like downward
pricing pressure from consumers and price increases from
One of the best ways to track just what consumers want from
you is the Internet. Since the 2007 recalls, the Internet is
viewed much like an educational venue to many pet parents.
Mobile websites offer activities and information in the form of
online advertising/promo approaches, podcasts, cell phones,
nontraditional media/branded projects, and online communities
and blogs. Utilize them. Your customers sure are.
See market value equations for the