Pet Owners Willing to Spend More on Products Linked to Pet Health
Once considered resilient and even recession proof, the pet products market has seen its fortunes suffer at the hand of the economic downturn, and experienced lower than usual growth in 2010. Despite the relative sluggishness of the past year, however, the U.S. pet market remains healthy due to numerous strong underpinnings, which will continue to support steady market growth for the foreseeable future, according to "Pet Market Outlook 2011–2012," from market research publisher Packaged Facts.
Packaged Facts found that the overall pet market grew 4% in 2010, which is modest compared to annual performance during most of the decade. Data from Packaged Facts’ pet owner surveys confirm that pet owners, like many Americans, put on the spending brakes even more in 2010 than they did in 2009. In the February 2011 survey, 35% of U.S. pet owners agree with the statement, “I am spending less on pet products because of the economy,” with 13% agreeing strongly and 22% agreeing somewhat. The year before, in a February 2010 survey, only 27% agreed overall and only 6% agreed strongly.
However, Packaged Facts expects the sales rate to notch back up to approximately 5% in 2011 and to almost 6% in 2012, assuming ongoing economic recovery, with subsequent years gradually improving upon this performance. Looking at the pet market from a 10–year perspective, its projected 6.3% compound annual growth rate for 2011–2015 will slightly best its 2006–2010 rate of 5.6%.
“The market bulwark will continue to be the most health–oriented category, veterinary services,” said David Lummis, senior pet analyst for Packaged Facts and author of the report. “As the population of senior pets continues to rise and market participants continue to adapt human–style technologies and medications and develop new pet–specific ones, the veterinary category will experience a 9% compound annual growth rate, which is much higher than other segments. As a result of its faster growth, veterinary services will continue to grow as a share of the total pet market.”
Reinforcing a health focus is the fact that health-oriented product areas showed growth in 2010, including cat and dog treats (particularly those with a functional health benefit), refrigerated/frozen raw foods and cat and dog supplements and nutraceutical treats. Success of these products in the midst of product sales doldrums elsewhere suggests that pet owners are willing to spend more on products that are linked to pet health.[Source: "Pet Market Outlook 2011–2012." Packaged Facts. 18 Apr. 2011. Web. 21 Apr. 2011.]