Economy pet food in Mexico saw positive growth in 2019

Value-added pet food products likely drove growth in the Mexican market in 2019, as a mediocre economy caused consumers to cut back on pet food expenses.

(Pixel-Shot | Shutterstock.com)
(Pixel-Shot | Shutterstock.com)

The pet food market in Mexico registered 13.3% value growth in 2019 compared to the previous year, according to reports. This figure, however, includes only wholesale and traditional channels.

The National Association of Wholesale Grocery Retailers in Mexico tracks transactions carried out at the so-called mom-and-pop stores, and it states that pet food was the most dynamic consumer goods product category among many others. Pet food growth surpassed that of groceries, at 8.3% in the same year.

Some analysts believe the growth of pet food is unbeatable as the Mexican millennial consumer segment is increasingly spending more of their income on pets and pet food. There is some truth to this statement. However, the reasons behind such vigorous growth are quite different and are explained by economic decisions, rather than sociodemographic trends.

Value-added pet food products boost market

Pet food products in the traditional channel are comprised mostly of inexpensive brands, which we categorize as economy products. Usually, when the overall economic situation tightens, consumers often cut back on their pet food expenses, downgrading from premium and standard-priced products to economy products.

As performance of the Mexican economy was mediocre in 2019, with flat growth, the pet food market likely adjusted to such a scenario. Thus, more than millennials purchasing more pet food, the growth of the category is attributable to price substitution.

Unlike groceries and other consumer products in the Mexican market, pet food is a category with numerous price points. The vast array of pet food brands at different prices allows consumers to substitute between brands.

Premium pet food volume likely down

As the current and future challenge for the local industry is premiumization, a more realistic barometer of the performance of the Mexican pet food market is volume growth experienced at the premium and super-premium segments.

In this context, it is highly probable that premium pet foods did not perform quite as positively in 2019.

Not only in Mexico but the entire Latin American region, a sound performance of value-added products signal improvements in disposable income that allow consumers to upgrade to pricier brands.

Page 1 of 696
Next Page