Study: Pet Product Market On The Rebound
The U.S. pet market is forecast to experience "steady market growth for the foreseeable future," according to "Pet Market Outlook 2011-2012" from market research publisher Packaged Facts.
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.
Health-oriented products are likely to continue to see the biggest growth, and marketers would be well-advised to focus their advertising accordingly, says 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," Lummis says. "As a result of its faster growth, veterinary services will continue to grow as a share of the total pet market."
Although it was once considered resilient and even recession-proof, the pet products market has suffered due to the economic downturn, and experienced lower than usual growth in 2010.
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.
A February 2011 survey showed that 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. A year before, in the February 2010 survey, only 27% agreed overall and 6% strongly.
However, Packaged Facts expects sales to notch back up 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, a 6.3% compound annual growth rate for 2011-2015 will slightly best its 2006-2010 rate of 5.6%.