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Market-Driving Trends for Pet Food & Care Products and
Packaging
The U.S pet market has been on a high for several years, continuously
expanding, and expressing growth even in times of economic hardship.
According to the U.S Pet Market Outlook 2010-2011, 61 million
Americans households own a pet, meeting the needs of nearly 400 million
pets. Pet owners are found to turn to their furry friends’ in the midst of
hard times for companionship, and express their appreciation in providing
better foods, toys and care products for their loved pets. Over 3,000 new
toys, treats, and other products were introduced alone in 2012 at the Global
Pet Expo. Consumer spending in the U.S pet market is predicted to reach
$62 million in 2013, up 4.7% from 2012 (Source: Packaged Facts). It is
likely spending will continue to increase as pet ownership among the
millennials generation has also jumped to its highest level.
The ever expanding pet market has increased competition amongst brands,
who are actively seeking new and innovative ways to differentiate their
products. Brands are now converting to the norm of adding natural product
lines to their range of products in order to appeal to pet owners’ purchasing
habits of more natural products, including organic pet food and ecofriendly products. It is found extremely difficult for new brands to emerge
in the pet market due to the all the regulations and rules having to be
passed to produce a product. This is in lieu with consumer demand for
products perceived to be safer which has impacted the way marketers now
position their products. Even with all of these factors, pet owners are less
price sensitive than in previous years which encourages brands to create
more higher-end products.
Each year there has been a steady increase in the amount of pet care, food
and toys products launched. Competition for every pet food dollar has
never been so intense, and pet food marketers’ are focused on presenting
products that stand out as well as remaining relevant in the industry.
Although online shopping equals approximately 6% of the transactions,
discount and online retailers are also putting the pressure on pet retailers,
offering quality products at lower prices.
Innovative product a n d p a c k a g i n g d e v e l o p m e n t i s a key
factor in taking advantage of the growing pet market. The top two ways
that pet owners find new products include browsing the store shelf and
television advertisements (APPMA). Packaging not only improves the
shopping experience, but can also play a large role in consumer loyalty to
your brand.
There are many major trends influencing the growth of the pet market, this
paper addresses what we find as the guiding market drivers and how
packaging can be utilized in order to take advantage of potential growth
areas.
Humanization of Pets
The family dog, cat, or fish is no longer considered to be the family pet. Instead, they are a
family member that deserves premium quality care. Approximately fifty percent of all pet
owners not only buy Birthday or Christmas presents for their animal, but also let the dog sleep in
the bed. As humans anthropomorphize their pets, they purchase products and services for their
pets that are fun and an extension of their own personal lifestyle. The humanization of pets
remains a strong trend, as manufacturers and retailers are introducing everything from humanstyle pet food to pet temporary tattoos.
In order to stay ahead of the competition, new and established pet brands must convert
consumer needs into tangible products that offer convenience and ease-of-use. People want their
pet products to convey a premium quality and packaging that is inferior to human product
standards will fail to deliver the necessary shelf impact to draw in shoppers. The pet food and
care segment is one of a handful of markets where price sensitivity is very low. Consumers are
more interested in the quality, taste and functionality of a product and selecting packaging
that communicates this message will make your product standout on the store shelf. One great
example is Iams Savory Sauce, which is a topping equivalent to human foods like ketchup that
is primarily used to enhance the eating experience for the dog. The package conveys the
message of quality and taste very clearly in its sauce style PET container and flip-top dispensing
closure. This package makes the product look so appetizing; it’s likely to be mistaken for human
grade gravy.
Pet Owners are less Price Sensitive
Pet owners have become increasingly devoted to their pets, having been found to reduce
spending on their own less essential needs even during the toughest of times. During the
recession, sales of pet products rose 4.8% in 2009 to reach $53 billion, meaning the market
added two and a half billion dollars in the midst of the biggest economic crisis. Pet Owners
Survey also shows pet owners are migrating to pet specialty channels and online retailers. The
pet market’s advantages are many, with the emotional impact of the human/animal bonding at
the top of the list. As the US moved out of recession, shoppers continued to demand greater
value in pet products and services they purchase. Pet owners may have cut back in some areas
but continued to spend on small indulgences for their pets, such as snacks and toys.
People are willing to pay for products that enhance their pet’s health, especially with the
increasing trend of natural and organic pet food. Pet owners are willing to pay $80-$90 for a bag
of dry pet food if it’s high-end natural food. Brands are building more loyal customer bases
which encourage pet owners to try new, and potentially more expensive, natural products
willingly spending on their pet’s health and wellness. Stella & Chewy’s brand, a premium brand,
has been experiencing a 50% growth year over year due to their innovative approach to pet food
including no fillers, organic fruits and vegetables and healthful probiotics, vitamins and
minerals. Stella & Chewy’s high cost of $40 for a bag does not seem to dissuade customers to
purchase, as the packaging is also made more accessible to its customers.
Packaging is a key as it can influence customers purchase intentions. Pet owners are looking for
fresh food for their pets whilst also consisting of a shelf-stable format, therefore the right
packaging is essential. Brands can use more eco-friendly package designs, such as closures and
bio-plastics, in which will appeal highly to a larger audience.
Brands Adopting Natural Product Lines
More and more brands have adopted more healthy and natural product lines due to the increase
of pet owners’ heightened awareness of pet health and wellness. In 2009, natural pet foods
accounted for $1.5 billion in sales (2010 Packaged Facts Report). Customers are willing to spend
more in order to maintain their pet’s health and brands are taking advantage. A few examples of
popular brands which have adopted natural product lines include Hill’s, Walmart, Nestle Purina
and Merrick. Product differentiation amongst brands has become extremely necessary, and
factors such as packaging can increase differentiation. The trends in pet food now consist of
gain-free, human grade and organic ingredients.
The magnitude of the pet food recalls has encouraged the pet owner to educate themselves on
what e x a c t l y i n g r e d i e n t s o n p a c k a g i n g a c c l a i m s f o r , such as “wheatgluten” and “meat by-product.” Many consumers are questioning the integrity of their brand
and are considering a switch to something new. This gives new players an opportunity to
differentiate themselves with ingredients that offer healthier alternatives to the usual name-brand
food. However, companies must also follow specific rules when making a claim being labeled
on their product delaying the time, sometimes dramatically, for a product to even enter the
market. Innovative packaging that communicates the message that the ingredients used in a pet
food brand are healthy and of human quality will definitely appeal to today’s pet owner. For
example, Old Mother Hubbard’s oven baked dog treats are packaged in a bag that looks fresh
from the bakery with text that lists the healthy ingredients of oatmeal, eggs, apples, and carrots
on the front of the bag.
Nutraceuticals and Pet Supplements
Market projections for the Pet Supplement and Nutraceutical Treats in the U.S retail sales at
$1.6 billion by 2017 including chewable tablets or soft chews, gels, pastes, liquids, powders,
sprays, and pet food toppers as well as nutraceutical treats, natural and organic products,
senior and other condition-specific products. As in human supplements, aging is the core
market driver as pets suffer from age-related conditions. Pet owners are becoming more
aware of these issues and seek to increase their knowledge on products that can maintain their
pets’ health.
Sales growth in the nutraceutical and pet supplement market has began to moderate, with
nutraceuticals becoming increasingly popular in pet food. Brands are now trying to outline what
types of vitamins, supplements, and nutritive additives would make a difference in pets and
which can be implemented as food ingredients. This also challenges marketers’ positions as they
are trying to maintain relevant amongst all the competition whilst remaining informative and
outlining key factors of products for customers. Selling pet supplements means educating
consumers and retailers about their benefits and differences, especially veterinarians. This is
mainly due to the undefined boundaries between pet supplements and food and can be difficult
for pet owners to acknowledge the difference.
If you’re selling organic, natural pet products or nutraceutical supplements, your packaging
ideally should help your brand capitalize towards the ongoing healthy trend. When packaging
vitamins, it is also important to remember that the human is still operating the package. 21st
Century’s entire line of pet products uses Weatherchem’s NutraFlapper flip-top closure that not
only ensures easy access, but also product safety. Difficult child-resistant and continuous thread
closures can be especially hard for aging adults. It is also important for the packaging to
communicate in an easy and fun way why organics and pet nutrition are the right products for
your pet.
Eco-Friendly Products and Safety
Companies have also started to embrace more sustainable packaging practices and production
processes in reaction to consumers responding to eco-friendly products. The state of the
environment is a growing concern among many people, and has already been established that a
lifestyle change for ourselves will very likely translate into a lifestyle change for our pets. Brands
are beginning to create an eco-friendly world which appeals to consumers’ green lifestyle.
Websites such as http://www.eco-dogs.com/ is an example of a place where consumers are more
comfortable and pleased with their purchase as the brand carries the same values as they do. The
website includes products from dog houses to pet treats.
There is an increasing awareness of the diminishing supply of global natural resources and of the
negative effects of pollution on the world around us. Pet products manufacturers should
“think green” when creating products and packaging. If you’re selling an eco-friendly
product, make the packaging eco-friendly as well. One brand we know that’s trying to make a
positive difference is Purina One Beyond. Made with 92% renewable material and bio-plastic
lining, the package provides better preservation of the product as well as providing a sustainable
package design. There are a variety of items eco-friendly consumers can purchase such as pet
beds made from plastic bottles, recycled dog toys, and even biodegradable waste bags.
We’re fully aware the heightened concern pet owners have about the safety of the products
they purchase. In Packaged Facts’ August 2012 Pet Owner Survey, approximately two-fifths of
pet owners feel that natural/organic brand pet products are better than standard national brand
products, with 63% reporting they are very concerned about the safety of the pet products they
buy. Consumers are also more interested in buying local and paying more attention to where
their pet food is made.
Emerging Pet Markets
Regions such as Eastern Europe, Latin America, and South Asia are all seeing a strong
growth in the market for pet food and care products. According to Pet Food Industry Magazine,
pet food and care sales in Asia were expected to grow 5% each year from 2007-2012.
Additionally, Eastern Europe saw a 10% growth in its pet product retail sales over the past year
(Euromonitor). As these developing areas gradually improve in overall standard of living, many
consumers find themselves with a rising disposable income. Part of this income is being spent
on care for their new pet companions.
There is an increasing awareness of pet food and care products and distribution of such items
continues to improve throughout these regions as well. For the pet manufacturers that are
interested in international growth in emerging markets, establishing your brand early is central
to a successful product launch. It is likely that the packaging innovations that are
appealing to this type of consumer on food products will also appeal to them on pet food and
care products. Understanding what types of packaging delivers convenience in their terms will
help build brand loyalty in the pet market.
Mold-Rite Plastics | Stull Technologies | Weatherchem Corporation