The majority of American households are more likely to have pets than children. Two-thirds of pet owners have several companion animals from various species. Recent demographic trends indicate that millennials may even prefer owning a pet instead of having children. The two largest pet-owning groups (baby boomers and millennials) also have discretionary income to spend on their furry friends, which is great news for pet retailers.
According to Acosta’s recent Hot Topic Report: “The Pet Parenting Boom,” Americans spent close to $30 billion last year on pet food and other specialty pet products. Total pet-related sales now exceed many other large categories like coffee, milk, cereal and baby products.
This should come as no surprise because 60 percent of households, which comprise nearly 80 million people, have at least one pet. This pattern may continue to grow as younger adults delay having children and opt for pets instead.
Source: Nielsen Planners Total xAOC 52wks ending 4/9/16
Americans always have adored their pets, and many regard them as cherished members of the family. The pet industry recognizes this emotional bond and now considers owners to be “pet parents.” Surveys show that 80 percent of owners treat their pets like children. Pet owners often celebrate the animal’s birthday and include them in holidays like Christmas. Millennial pet owners also are inclined to prioritize spending on their pets instead of themselves, because it appears that they consider their pets as substitute babies.
Although most owners want to spend more time with their pets, millennials and baby boomers have different opinions about the necessity of purchasing some pet-related items. While the older generation may see toys, treats and apparel as nonessential, millennials often lavish their companion animals with these items. But regardless of this disparity, pet parents have increased their overall spending on the four-legged members of the family. And once owners find a brand that they like, they often are inclined to remain loyal to the product regardless of price, sales or discounts.
Source: Acosta Custom Pet Survey, May 2016 (Note: Respondents could select more than one answer)
Like the parents of children, pet owners consider the health and wellness of their companion animals a top priority. Health and wellness concerns drive many pet-related purchase decisions. As a result, there has been a surge in popularity for all-natural and organic pet food. Pet owners spend hundreds of dollars per animal each year on grooming, medical expenses and wearable devices to monitor their pet’s health and activity levels. There is an incentive for pet industry retailers to proactively help pet parents care for their furry family members.
Source: Acosta, Inc.
The retail pet channel is growing to keep up with the increased demand. Overall sales of pet food and products are expected to surpass $38 billion by 2020, according to the same Acosta report. While online sales are increasing, the number of brick and mortar stores, including specialty retailers, catering to pets and their owners also is growing. Although price is a consideration when deciding where to shop, many owners also consider the variety of pet products available as well as the convenience of a particular location.