Tons of pet food sold during Alibaba shopping festival

Singles’ Day proves profitable for China's pet food market, especially on the e-commerce front.

E-commerce provides a profitable outlet for the Chinese pet food market. | Photo courtesy Aliexpress/Alibaba
E-commerce provides a profitable outlet for the Chinese pet food market. | Photo courtesy Aliexpress/Alibaba

Chinese pet owners bought over 14,000 metric tons of cat food and 18,000 metric tons of dog food during Alibaba Group's recent Singles' Day shopping event.

Also called Double 11 (as it happens on November 11), the blockbuster online shopping festival generated sales of US$38.4 billion (RMB268.4 billion) in just 24 hours. Compared to 2018's numbers, 2019's total sales or gross merchandise volume (GMV) represent a 26% increase based on orders placed with Alibaba's various online retail platforms like Taobao.com and Tmall.com.

Alibaba’s real-time trading data showed pet food, smart home appliances and nutrition supplements among the best-selling imported products during the event.

Demographic and trend influences during Double 11

The majority of those who purchased pet food items during the one-day shopping spree belong to China's younger generation. Alibaba noted that this group favored imported and high-end brands for their pets. They were mostly from China's first-tier cities of Shanghai, Beijing, Guangzhou and Shenzhen, but orders for pet food also poured in from China's smaller cities. A 2019 China Pet Industry White Paper believes Chinese major urban centers are home to some 99.15 million pets.

Alibaba said the trend towards premium, imported pet food was evident even during 2018's Singles’ Day event when Taobao sold over 100 flavors of wet cat food from Thailand, New Zealand and the United States. Aside from pet food, Taobao expects consumption of pet-related products on the platform to surpass RMB50 billion (US$7.1 billion) in two years as consumers also look for digital feeders, water bowls and other pet care items.

A boon to international pet food companies is the cross-border e-commerce in China that allows them to sell to Chinese consumers online via channels like Alibaba's TMall. Sellers enjoy preferential duty rates without having to operate a licensed business in the country. An industry report by Deloitte, the China Chamber of International Commerce, and AliResearch, a member of the Alibaba Group, singled out pet supplies and consumer electronics as two of the fastest-growing categories that Chinese consumers buy via cross-border e-commerce. The global online channel had a compound annual growth rate of 76% between 2015 and 2018, while generating RMB78.5 billion (US$11.2 billion) in GMV in 2018.

China and pets

In 2018, China's total pet population was 551 million and their owners spent over RMB170 billion (US$24.2 billion) on them, according to a white paper by goumin.com, one of China’s most-frequented online forums. Shenzhen-based ASKCI Consulting said China's pet industry would grow 20% annually in the next three to five years to be worth RMB250 billion (US$35.6 billion) by 2022.

China is the second-largest retail market in the world, worth US$5.8 trillion as of 2018. By 2022, the country will have 755 million pets.

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