Americans are beginning to loosen up their wallets when it comes to their pets. Although pet owners were not immune to the Great Recession’s effects, a 2013 pet-owner survey from the Packaged Facts division of Rockville, Md.-based MarketResearch.com revealed that they are becoming less price-sensitive than in years past.
Sales in mass channels such as grocery stores have been relatively flat, however, with pet owners continuing to migrate to pet specialty channels and their higher-end offerings such as natural food products, the market research firm notes.
Pets are people, too
The humanization of pets continues to be a strong trend, Packaged Facts states, with manufacturers and retailers introducing everything from human-style food to temporary tattoos for pets.
“There have been so many articles written about the empty-nesters substituting their pet for their children, or young couples and singles starting out with a pet and making it their first ‘child,’” says Peggy Hillier, a spokesperson for New York-based Royal Animals.
In a nutshell, more people are thinking of their pets as members of the family, explains Jackie Roberge, director of marketing for Intersand, Boucherville, Quebec.
“Because of this, they are willing to spend more money taking care of their pet and also treating them to special luxuries,” she says. “This is spurring the growth of the premium cat and dog food and treat market.”
Premium translates into the inclusion of more “human-oriented ingredients” such as real chicken and meat and fewer low-nutritive-value fillers, Roberge adds.
Keep them healthy
Another trend coming out of the humanization trend is that toward pet health and wellness.
As Chris Ruben, chief marketing officer for New Hamburg, Ontario-based Eurocan Pet Products and founder of AdoptAShelter.com, explains, that means limited ingredient panels and products with no additives, preservatives and other ingredients pet owners cannot pronounce.
“As pet parents change their own food for a healthier diet, they are doing the same with their much-loved furry family members,” says Nancy Volin, founder of Pampered Pets USA, Alpine, Calif. “We are seeing more offerings of grain-free [products] and products that are wheat-, corn- and soy-free to alleviate allergies.”
Also on trend, she says, are products that promote dental health, help with weight management and provide nutritional benefits for senior pets. And on the ingredient side, fruit and vegetables are showing up more often, as is fiber, which helps temper pet obesity and hairball symptoms in cats.
The health and wellness trend goes hand-in-hand with that toward the avoidance of frequent veterinary visits, Roberge notes. And it’s not limited to pet food products.
“We are also starting to see some cat litters with special technology that helps with the early detection of health issues through a urine analysis,” she says. “Products that help animals stay healthy are going to keep growing in sales.”
Retailers have a huge opportunity to leverage the overall health and wellness trend, says Bill McKee, vice president of U.S. private brand sales and marketing for Simmons Pet Food Inc., Siloam Springs, Ark.
“Most of the leading health and wellness brands are channel-specific,” he notes. “While a private brand offering in this space can bring consumers the same quality at a better value, they also have the added benefit of convenience, making these products available where consumers shop.”
But not everyone is convinced that all of the on-trend health-and-wellness-oriented pet food products, some of which include exotic meat or seafood proteins such as bison and wild salmon, are sustainable for the long-term.
“If you want to create a brand for the long-term, focus on the true sustainable meats like chicken, beef and lamb,” advises John Farrell, vice president of sales for PetPals Group Inc., City of Industry, Calif. “As far as raw and grain-free, focus on what’s driven the industry in the past and will continue into the future — value and quality.”
The same strategy holds true for pet-oriented hard goods, he adds.
“Brand your own, and bundle the purchases to the customer with loyalty programs and exclusive purchase options of new and limited-time items.”
Keep them safe
Product safety, especially on the food side, represents another area of concern for pet owners.
“Jerky is a hot topic right now — especially jerky made in the USA,” says Rich Coy, senior national accounts manager for Vets Plus Inc., Menomonie, Wis. “Imported jerky is being frowned upon due to reported issues of ‘made in China’ product causing sickness and sometimes death in dogs.”
Steven Shweky, “top dog” (president) of Fetch… for pets!, New York, agrees that the country of manufacture is important to safety-conscious pet owners.
“If a product is manufactured in the United States, make sure to point that out,” he advises retailers.
Packaging also comes into play here.
“With the coming animal food rules under the Food Safety Modernization Act, the trend in packaging is toward safety, with individual packages,” Ruben notes.
On-pack messaging touting U.S. or Canadian raw materials from plants inspected by the USDA or the Canadian Food Inspection Agency (CFIA) could help attract wary pet owners, he adds.
“Green” products also can be safer for pets and are on trend, especially in the cat litter category.
“We see both large multinational companies [responding] and small niche brands being launched to respond to this growing need,” Roberge states. “The products range from corn, wheat and pea fibers to walnut and eggshells, as well as paper and wood options.”
Bring it all together
In addition to approaching product development with an eye on trends, retailers could take a number of steps to build excitement — and sales — within the pet care category. Whether on-pack or elsewhere, messaging such as “natural ingredients,” “premium-quality ingredients,” “made in the USA,” “limited ingredients,” “wheat-, corn- and soy-free,” “dental care” and “grain-free” will attract attention, Volin says.
Speaking of messaging, retailers also need to educate their pet-owner shoppers beyond callouts.
“To do this, they need to provide consumers with information on the products, whether it’s through in-store displays or a specific message on packaging,” Shweky says.
Merchandising enhancements also can put a spotlight on store brand pet care products.
“Create a ‘store within a store’ by leveraging the store brand name recognition against the national brands,” Coy recommends, adding that Deerfield, Ill.-based Walgreen Co. and its Pet Shoppe brand have had success in doing so. “If a ‘store in a store’ concept is used, the message is very visual — like-looking labels, colors, etc., will create a strong presence and convey the message to the consumer that [you] are serious about helping to solve [their] pets’ needs,” he adds.
Farrell advises keeping all of the store brand items together, “with crossover items listed on the shelf or packaging — like pairing a wine with a meal.” Also effective are loyalty programs and the promotion of “only here” availability.
End-cap displays work well, too, particularly for new store brand items in the category.
“Impactful signage is key both on the end cap and in the home location,” Hillier stresses. “In the home location, channel strips or aisle violators help call out and draw attention.”
Coupons also can be effective in getting shoppers to try private brand pet products, McKee says.
“Social media is also important,” he adds, “as today’s pet owners are connected. The health and wellness consumer is especially in tune to social media, as they do a lot of personal investigation and research.”
And don’t discount the draw of well-known licensed characters. When a retailer adds a character such as Garfield the cat to its store brand package, the result is instant brand awareness, says Gay Nation, director of sales for Paws Inc., Albany, Ind., which licenses Jim Davis’ characters, including Garfield and his sidekick, Odie.
“We work with retailers and manufacturers to create exclusive package design that is different from a national brand or another store [brand] packaging,” she explains. “Garfield has a rich history in the pet industry and is unique in the fact that we allow for our characters to interact with the actual product on the packaging design.”
Finally, get serious about the category, Farrell advises.
“For years, pet specialty has been taking some of the top people from mass,” he says. “Coincidence? I think not. If a retailer is serious about pet, go out and find pet people, and see what happens.”