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Adventures in Pet Food

Debbie Phillips-Donaldson, editor-in-chief of Petfood Industry, shares her insights and opinions on all things pet food, addressing market trends as well as news and developments in pet nutrition, food safety and other hot topics for the industry.
Pet Food Market Trends
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Does pet food need Amazon – and vice versa?

July 28, 2017

For the pet food market, online giant Amazon has been making news on a regular basis, aside from its blockbuster announcement in June 2017 that it’s acquiring Whole Foods Market. For one thing, the shopping portal sells a lot of pet food: about US$700 million a year in the US alone, or approximately 35 percent of its reported US$2 billion in US sales of pet products overall, according to One Click Retail.

A new report from One Click Retail on sales of consumables on Amazon during the second quarter of 2017 (Q2) shows that pet food was the fastest-growing category among pet supplies in the four countries studied, and the top-selling pet category in three of them. Specifically, sales of pet food and feeding supplies increased year over year (YOY) for the quarter in the US, Canada and France by 40 percent, 70 percent and 25 percent, respectively, while pet food alone grew 25 percent in the UK.

Blue Buffalo dog foods dominate US Amazon sales

Sales of all pet supplies in the US on Amazon totaled US$350 million in Q2 2017, representing 30 percent YOY growth; the top-selling category was pet food and feeding supplies (in addition to being the fastest growing). This is no surprise: The American Pet Products Association’s 2017-18 National Pet Owners Survey showed that among US pet owners purchasing pet products online within the past 12 months, 54 percent ordered from Amazon.com – by far the most popular option.

According to One Click Retail, the specific product showing the highest growth on Amazon in the US was Blue Buffalo’s Blue Life Protection Formula dog food, with a huge 220 percent rise. In fact, five of the fastest-growing pet items on Amazon in the US were Blue Buffalo dog foods, or the majority of the eight dog foods among the top 10 growers, said Nathan Rigby, vice president of One Click Retail and author of the report.

In the UK, a Felix cat food from Purina, As Good As It Looks Mixed Jelly Pouches, was the fastest-growing item, at 225 percent. Overall, UK sales of pet supplies on Amazon increased 40 percent to 30 million GBP (US$39.2 million) for the quarter, and again, pet food was the top-selling category in addition to being the fastest growing.

Royal Canin’s (a division of Mars Petcare) Medium Sterilised Dog Food topped the list of fastest-growing pet care items on Amazon in France, with a whopping 410 percent increase. Granted, the report doesn’t provide sales figures for individual products, so we don’t know how much the dog food contributed to the country’s 4.1 million Euros (US$4.8 million) in pet supplies sales on Amazon. Sales grew 20 percent YOY, with pet food and feeding supplies as the top-selling and fastest-growing category.

The only one of the four countries where pet food didn’t dominate the pet supplies category was Canada, which reached US$4.5 million in sales on Amazon, at 75 percent YOY growth. The top-selling category was training and behavior, though pet food and feeding supplies was the fastest-growing category.

Implications for pet food brands

The One Click Retail report covered other types of consumables on Amazon – health and personal care, grocery and beauty – in addition to pet supplies, saying the average growth among the four groups was 45 percent across the four countries. That means the pet food growth shown in the report is right in line with these other popular consumer products. And the category’s sales, along with those for pet supplies overall, also place pet food in the ranks of these other types of products; for example, the Q2 pet supplies total of US$350 million in the US on Amazon is at parity, or very close to it, with US sales of cold beverages (US$410 million) and skin care products ($340 million).

So it seems that pet food is an important product category for Amazon. Of course, the online portal is important to pet food brands, too. Whatever you might think of Amazon and its business strategies, its sheer size and popularity give it an enormous influence. That is certainly the case with its most recent acquisition: “Lots of theories about the deal already have emerged, and they have implications for all businesses’ survival in the Amazon era,” wrote Tim Mullaney on CNBC.com recently.

It’s also true in terms of selling your products today. “The growth in sales of consumables on Amazon far outstrips domestic growth in each of these countries,” wrote Rigby of One Click Retail. “While consumer trends are shifting, for the most part people are not buying significantly more consumables than they used to. Instead, the growth in ecommerce consumables sales (for which Amazon is the market leader) causes a decrease in brick and mortar sales. Even in product categories not typically associated with ecommerce, such as perishables and spirits, brands need to focus their efforts on Amazon in ordered to compete effectively in 2017.”

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dphillips@wattglobal.com

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