China's pet market has been growing steadily for over a decade, but it's faced some tough challenges recently. From the uncertainty of epidemics to the turmoil caused by high inflation and rising interest rates, China's pet market has been a bit of a roller coaster ride of ups and downs.
In this article, we'll look at some of the most interesting pet trends together to get a feel for where the pet market is heading. We'd love to hear your thoughts in the comments section.
"The impact of the epidemic didn't end when the new crown epidemic subsided. One of the biggest surprises of the post-epidemic era has been the spike in inflation, which has been linked to much of the growth of the last two or three years.
Depending on how the Consumer Price Index changes, inflation in all pet market categories in 2022 and 2023 is double or triple that of previous years. It might seem like the big platforms are competing on price and brands are launching products that offer good value, but if you compare prices from a few years ago, you'll see that goods have risen quite a bit in price.
In the past, premiumisation was the main driver of the market, but inflation has raised the bar even further, making affordability a big concern.
If pet marketers want to get pet owners to buy higher-priced products in the future, they need to show why their products are worth the extra cost and highlight the benefits for pet health.
Young pet owners are key to the future of the pet industry. As more and more baby boomers get older and stop having pets, it's important that younger people start buying them.
However, younger consumers face some big obstacles when it comes to getting a pet.
The credit crunch is hitting young pet owners harder than Baby Boomers and Gen Xers. They're more likely to be saddled with credit card debt. Young pet owners are also more likely to live from one paycheck to the next and use a 'buy now, pay later' strategy. Not having enough money to spend on other things makes it difficult to afford to have a pet.
Microcredit loans: Microcredit loans also have a big impact on disposable income. Roughly 10% of pet owners have microloans, like installment loans and debit loans, and that number jumps to 15% among millennial pet owners. As these consumers try to manage the burden of microcredit, they may cut back on non-essential purchases in favour of low-cost brands and look for alternatives to expensive veterinary services.
Housing Patterns: There's a strong connection between dog ownership and housing type. There's a 68% difference in dog ownership between homeowners and renters. It's getting harder and harder for young people to buy their own homes at the moment. Property prices are high, there's pressure to buy, and renting is getting more expensive. This could have a negative impact on the pet market, with fewer families owning dogs.
While many consumers are looking to save money, it's worth noting that pet owners don't want to sacrifice quality in order to save money.
The results of the March 2024 Pet Scripture Speak Layer survey of pet owners show that 71% of pet owners say product quality is the most important thing for them when they're buying something. Just over two-thirds of pet owners (61%) say that value for money is almost as important as price, while only a third say that a low price would influence their purchase.
Some pet owners are looking to save money by buying less expensive pet food brands. The survey results show that 32% of dog owners and 28% of cat owners who have changed their pet food in the past year picked a lower-priced brand.
In line with this, private label products are also becoming more popular, which is great news for the pet market. "Globally, private label usage in China is still much lower than in most European and American countries, so there are plenty of opportunities for both white labels and pet shops and training schools to create their own brands.
The trend towards flat or even declining dog populations has undermined some of the key growth areas for the pet industry. Many businesses that are based on owning and caring for dogs are now slowing down. This is because of generational shifts in pet ownership, the cost of owning pets, and the overall growth of the Chinese household economy. It seems that younger people are gradually favouring cats, which is leading to slow growth in the dog market.
Taking a broad view of the pet food market shows that when a brand launches a new product, it's usually a mix of cat and dog food. Sometimes it's two-thirds cat food and one-third dog food, or even no dog food at all.
The way we care for our pets is changing thanks to technology. It's becoming more and more common for pet owners to use tools like pet wearables, GPS trackers, smart feeding devices and health-monitoring apps to keep an eye on their pets' health.
Meanwhile, tech-driven veterinary clinics are changing the way veterinary technology is used. These cutting-edge clinics bring together a range of tech, including mobile clinic apps, online appointments, AI support and remote diagnostic tools. The rise in tech integration, fuelled by more funding and teamwork, is setting a new standard for veterinary care.
As this trend grows, we're likely to see more and more veterinary clinics adopting these cutting-edge methods, which will pave the way for a more technologically advanced approach to pet health.
There's a growing trend towards personalised pet nutrition. More and more pet owners are choosing customised diets, including bespoke pet food subscriptions and diets that are specifically tailored to their pet's unique health needs, breed or age group, such as pet baking and pet fresh food.
It's estimated that up to 88% of pet owners believe that preventative health measures for their pets are critical. On top of that, the 2022 FMCG Gurus report shows that 40% of pet owners around the world use specialised pet foods to give their pets a boost.
People are starting to think about their pets' mental health as well as their physical health. This change has led to lots of new products and services designed to make pets' lives better, from things that help them relax to supplements and even specialised pet therapy services.
In particular, the global CBD (cannabidiol) pet market has seen some impressive growth. Grand View Research reckons the market will be worth around $195.98 million in 2022, with a projected compound annual growth rate (CAGR) of 31.8 percent. This growth is partly down to some promising research, including a ground-breaking study done by Cornell University.
The study showed that CBD could be a useful way to control pain, especially in dogs with osteoarthritis. It's worth noting that over 80% of the dogs in the study reported a reduction in pain levels, which led to improved comfort and increased mobility.
Mobile pet services have made life a lot easier for busy pet owners. This trend includes mobile grooming, veterinary services and pet sitting, all of which can be delivered directly to the client's home. It's a bit of a hassle, but it's a competitive move in today's heavily involutional environment.
In the pet boarding space, dog boarding is the biggest earner, accounting for a respectable 54.2 per cent of revenue. More and more dog owners are signing up for subscription-based dog toy services, which is driving up demand for animal toys in the market.
The rise of lots of dog sitters and the growth of services by market players to cater to more animal types, like dogs and other pets, has also helped mobile pet services to grow.
There's been a big increase in the number of people travelling with their pets, which is driving the demand for places to stay and travel options that welcome pets. This has led to the emergence of pet-friendly hotels, pet-centric airline policies and holiday packages specifically for our four-legged companions.
Hua Ma Tang data shows that over 40% of orders for this year's May Day holiday were for "cute pet guests", with 30% travelling with a dog or cat and 10% travelling with two or more pets. Wan Zhong, general manager of Chengdu Shili Huamantang Daoxiang Hotel, said that around 50% of guests brought their pets on holiday, and 25-40% on weekends. Another pet travel company told us at Pet Sense that they've welcomed over 1,000 furry friends in just six months this year.
The pet service landscape is changing and growing beyond traditional services. The rise in niche markets like professional pet services, such as pet photography, pet party planning and even pet dating platforms, shows that more and more people are recognising pets as family members.
For pet shops, offering more services is also a good way to compete. For instance, some pet shops are even learning how to bake for their furry friends and offering coffee and tea to keep up with the competition.
Dogs are the most popular pet in the world, followed by cats. However, cats have slowly become more popular than dogs in China.
There's a growing number of pet owners, and more and more people are treating their pets like family. That means they're looking for high-quality care and products.
The pet food industry is the biggest part of the pet industry, making billions of dollars in sales every year. This is down to the basic need of pets for nutrition.
The main thing pet owners buy is food for their pets, but they also spend a lot on health, wellness and grooming products.
It's the Millennials, typically those in their 20s and 30s, who buy the most pet products. This reflects their strong bond with their pets and their spending habits.
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