Pet Food in the U.S., 14th Edition - Research and Markets

Pet food marketers are headed towards an uphill battle, facing plateauing sales growth due to the leveling off of superpremium-fueled price increases and growing pricing pressure stemming from the advance of the Internet and mass premiumization. There are bright spots in this saturated market, however. Although the Internet is poaching sales from brick-and-mortar retailers, online sales are for the time driving incremental growth in the market as a whole by promoting in-demand brands and auto replenishment. Also positively impacting the market are millennial pet owners, who are willing to pay more for quality products, especially those featuring sustainably and ethically sourced ingredients. Other opportunities reside in specialized diets targeting the aging pet population and in high-quality, freshly made pet food prepared in-store or ordered online for home delivery.

Drawing on more than 20 years of experience in analyzing the pet food industry as well as the analyst's broad cross-category expertise, Pet Food in the U.S., 14th Edition pinpoints strategic directions for current and prospective pet food marketers, with a forward-looking focus on high-growth product segments and market drivers. Covering foods for dogs and cats, the report examines trends by form (dry, wet, semi-moist, and frozen/refrigerated), ingredients, and product claims across the full retail spectrum including mass-market outlets, the pet specialty channel, online retailers, and other channels. It provides a comprehensive overview covering historical market size and projections (2014-2023); cross-market trends; consumer expenditures; market opportunities; mergers and acquisitions; channel trends including e-commerce and omnichannel; the Millennial impact; and new product and marketing trends.

The study highlights consumer purchase patterns and product and brand preferences for dog and cat food as well as the market as a whole. Including dozens of product illustrations, it focuses particularly on trends in marketing and new product development, while also identifying key players in dog and cat food overall. Additional data sources include Simmons profiling trends in pet ownership, purchasing attitudes, and product preferences, including demographic trends down to the brand level, and SPINS data on the natural and gourmet channel.

Executive Summary

Market Overview

Introduction
Market Size and Growth
Market Drivers
Table Level of Agreement with Statement: "I am willing to pay more for pet food products that are healthier for my pets," 2017 vs. 2018 (percent of pet product buyers)
Looking AheadCompetitive Overview
Retail Channel Trends

Product and Marketing Trends

Natural Pet Food
Condition-Specific Foods: Veterinarians to the Fore
Product Safety and Made in the USA
Healthy Gourmet/Indulgent Foods
Customized Pet Food and Meal Kits for Home Delivery

Dog Food

Market Size and Growth
Marketer and Brands
Dog Food Purchasing Patterns

Cat Food

Market Size and Growth
Marketers and Brands
Cat Food Purchasing Patterns

Opportunities

Opportunity 1 – Personalized Pet Food
Opportunity 2 – Spotlight on Sourcing, Sustainability, and Animal Welfare
Opportunity 3 – Premiumized (Further) Cat Food
Opportunity 4 – The Internet
Opportunity 5 – Pet Overweight and Obesity

Market OverviewChapter Highlights

Introduction

Two Animal Categories: Dog and Cat
Other Marketing Classifications

Market Size and Growth

Pet Food Will Top $27 Billion
- Table U.S. Retail Sales of Pet Food, 2014-2018 (in billions of dollars and percent change)
Dog Food Dominates Pet Food Sales
Dry Pet Food Dominates Sales
Dry Dog Food at Over 50% of Market
- Table Share of U.S. Retail Sales of Pet Food by Form and Animal Type, 2018 (percent and billions of dollars)
- Table Annual U.S. Household Expenditures on Pet Food by Product Form, 2018 (in billions of aggregate dollars and per-household dollars)
- Table Annual U.S. Household Expenditures on Pet Food by Animal Type, 2018 (in billions of aggregate dollars and per-household dollars)
Sales by Channel
- Table Retail Dollar Sales of Dog and Cat Food in the Specialty Gourmet and Natural Channel, 2016 vs. 2017 (in millions of dollars and percent)

Market Drivers
- Pet Food Market Facing Major Headwinds
- Innovation Drives Pet Food Marketers in New Directions
- Internet Steals Brick-and-Mortar Share Yet Buoys Overall Market
- Mass Premium Brands No Recipe for Long-Term Market Growth
- Natural Pet Food Sales Still Healthy But Likely Headed for Moderation
- FDA Warning About CDM Casts a Shadow Over Grain-Free Pet Food
- Pet Food Safety: Issue and Opportunity
  - Table Level of Agreement with Statement: "Fear of pet food contamination/product safety is a key consideration in the dog foods/cat foods I buy," 2015-2018 (percent of dog- and cat-owning households)
  - Table Level of Agreement with Statement: "I am concerned about the safety of the dog food, dog treat, and dog chew products (or cat food and treat products) that I buy," 2015-2018 (percent of dog- and cat-owning households)
- Scaling Up Superpremium
- Consumers Willing to Pay More for Healthier Pet Edibles
  - Table Level of Agreement with Statement: "I am willing to pay more for pet food products that are healthier for my pets," 2017 vs. 2018 (percent of pet product buyers)
- Is Premiumization Disenfranchising Non-Affluent Households?
  - Table Pet Food Purchasing by Price Level, 2015-2018 (percent of dog- and cat-owning households)
- Pet Food Production Costs Rising
- Pet Ownership Trends
  - Table Household Penetration Rates for Dogs and Cats, 2009-2018 (percent of U.S. households)
  - Table Household Base for Dogs and Cats, 2009-2018 (in millions of U.S. households)
- M&A, Retail, and Marketing Initiatives Going Strong
- Pets-as-Family Trend Getting a Millennial Boost
- Growth in Wet Pet Foods
  - Table Usage of Wet Pet Food, 2009-2018 (percent of dog- and cat-owning households)
Looking Ahead
- Sales Growth Slow But Steady Through 2023
  - Table U.S. Retail Sales of Pet Food, 2018-2023 (in billions of dollars and percent change)
- Tariffs and Trade War with China Could Hamper U.S. Market
Competitive Overview
- Human Food Companies Expand Into Pet Market
- Lawsuits and Recalls
- Mass Premiumization Is Changing the Channel Dynamic
- Pet Specialty-Specific Brands Persist
- Veterinary Diet Marketers
- Inspiring Trust
Retail Channel Trends
- Walmart Is Preferred Retailer for Pet Food Purchases
  - Table Pet Food Purchase Patterns by Channel, 2018 (percent of dog- and cat-owning households)
  - Table Most Important Factors Impacting Choice of Pet Food Retailer, 2018 (percent of dog- and cat-owning households)
  - Table Where Pet Food Was Purchased in Last 12 Months, 2017 vs. 2018 (percent of dog- and cat-owning households)
  - Table Pet Food Shopping Methods by Frequency, 2018 (percent of dog- and cat-owning households)
  - Table Share of Pet Food Spending by Purchase Method, 2018 (percent of dog- and cat-owning households)
- Private-Label and Exclusive Brands Taking on New Importance
- Mass Premiumization Good for Mass Retailers
  - Table Percent and Index Buying More, Less, or Same Amount of Pet Products from Walmart by Age Bracket, 2018 (percent and index of dog- and cat-owning households)
- Customer Service, Natural Brands Help Independents Shine
  - Table Most Important Factors Impacting Choice of Pet Food Retailer by Channel, 2018 (percent and index of dog- and cat-owning households)
- Pet Specialty Chains Rethink Pet Food

Product and Marketing Trends

- Chapter Highlights
- Natural Pet Food
  - Natural Pet Food Spin-Offs and Cousins
    - Table Dog and Cat Owners Currently Using Pet Food: By Free-Of Claim, 2018 (percent)
  - Natural Claims Still Resonate with Consumer Mindsets
    - Table Level of Agreement with Pet Food Purchase Patterns by Formulation, 2018 (percent of dog- and cat-owning households)
  - Organic Pet Food
  - Human-Grade and Human-Style
  - Clean Food Trend Carries Over From Humans to Pets
  - Grain-Free Pet Food
  - Novel and Exotic Proteins
    - Table Agreement with Statement: "My dog/cat needs a high-quality protein diet," 2017 vs. 2018 (percent of dog owners vs. cat owners)
  - Sustainability and Ethically Produced Ingredients
    - Table Sourcing-Related Pet Food Information that Dog and Cat Owners Find Important, 2018 (percent of dog and cat owners)
  - Frozen/Raw Pet Food
  - "Preserved Dry" (Freeze-dried and Dehydrated) Pet Food
  - Trendy Superfood Ingredients Getting a Millennial Boost
- Condition-Specific Foods
  - Condition-Specific Foods: Veterinarians to the Fore
    - Table Level of Agreement with Statement: "High-quality dog foods/cat foods are effective for preventive healthcare," 2018 (percent)
  - Ongoing Innovation in Weight-Loss and Senior Foods
  - Pet Food Marketers Meeting Smaller Dog Trend Head On
  - Other Marketing Claims Built on Safety, Indulgence
    - Table Level of Agreement with Statement: "Fear of pet food contamination/product safety is a key consideration in the dog foods/cat foods I buy," 2015-2018 (percent of dog- and cat-owning households)
    - Table Level of Agreement with Statement: "I am concerned about the safety of the dog food, dog treat, and dog chew products (or cat food and treat products) that I buy," 2015-2018 (percent of dog- and cat-owning households)
    - Table Top Draws for Selected Product Claims Among Dog and Cat Food Purchasers, 2018 (percent)
  - Customization and Personalization

Dog Food

Chapter Highlights
- Historical and Projected Dog Food Retail Sales
  - Table U.S. Retail Sales of Dog Food, 2014-2023 (in billions of dollars and percent)
  - Table Annual Household Expenditures on Dog Food by Product Type, 2018 (in billions of aggregate dollars and per-household dollars)
Marketer and Brands
- Dog Food Marketers in Mass-Market Outlets
- Pet Specialty Brands
- Freshpet Dominates Refrigerated Dog Food Category
- Private-Label Dog Food
Dog Food Purchasing Patterns
- Most Dog Owners Buy Dry Dog Food
  - Table Dog Food Formulations Used in Last 12 Months, 2017 vs. 2018 (percent of dog-owning households)
  - Table Select Demographic Indicators for Use of Wet Dog Food, 2018 (percent of dog-owning households)
- Millennials Most Likely to Use Organic Food
  - Table Dog Food Formulation Categories Used in Last 12 Months by Age Group, 2018 (percent and index of dog-owning households)
  - Table Dog Food Formulation Categories Used in Last 12 Months by Race/Ethnicity, 2018 (percent and index of dog-owning households)
- Older Americans More Likely to Use Food Made in USA
  - Table Dog Food Specialty Formulations Used in Last 12 Months by Age Group, 2018 (percent and index of dog-owning households)
  - Table Dog Food Specialty Formulations Used in Last 12 Months by Race/Ethnicity, 2018 (percent and index of dog-owning households)
- Pedigree Tops in Household Penetration
  - Table Dry Dog Food Usage Patterns by Brand, 2014 vs. 2018 (percent and number of dog-owning households)
  - Table Wet/Moist Dog Food Usage Patterns by Brand, 2014 vs. 2018 (percent and number of dog-owning households)
- Dry Dog Food Sole Usage Rates Increase
  - Table Dog Food Usage Patterns by Select Brands, Any Usage vs. Sole Usage: 2014 vs. 2018 (percent of dog-owning households)
- Other Dog Food Brand Penetration
  - Table Dog Food Brands Purchased in Last 12 Months, 2018 (percent of dog-owning households)
- Dog Food Purchase Patterns by Channel
  - Table Dog Food Purchase Patterns by Channel, 2018 (percent of dog-owning households)
  - Table Dog Food Online Purchase Patterns by Website, 2018 (percent of dog-owning households)

Cat Food

Chapter Highlights
Market Size and Growth
- Historical and Projected Cat Food Retail Sales
  - Table U.S. Retail Sales of Cat Food, 2014-2023 (in billions of dollars and percent)
  - Table Annual Household Expenditures on Cat Food by Product Type, 2018 (in billions of aggregate dollars and per-household dollars)
Marketers and Brands
- Nestlé Purina's Hold on Cat Food
- Private-Label Cat Food
Cat Food Purchasing Patterns
- Canned Food Is Stronger in Cat Arena
  - Table Select Demographic Indicators for Use of Wet Cat Food, 2018 (percent of cat-owning households)
  - Table Cat Food Types Used in Last 12 Months, 2018 (percent of cat-owning households)
- Usage of Cat Food by Specialty Formulation
  - Table Cat Food Formulation Categories Used in Last 12 Months by Age Group, 2018 (percent and index of cat-owning households)
  - Table Cat Food Formulation Categories Used in Last 12 Months by Race/Ethnicity, 2018 (percent and index of cat-owning households)
  - Table Cat Food Formulations Used in Last 12 Months by Age Group, 2018 (percent and index of cat-owning households)
- Friskies Tops in Household Penetration Rates
  - Table Dry Cat Food Usage Patterns by Brand, 2014 vs. 2018 (percent and number of cat-owning households)
  - Table Wet/Moist Cat Food Usage Patterns by Brand, 2014 vs. 2018 (percent and number of cat-owning households)
- Dry and Wet Cat Food Sole Usage Rates Increase
  - Table Cat Food Usage Patterns by Select Brands, Any Usage vs. Sole Usage: 2014 vs. 2018 (percent and number of cat-owning households)
- Other Cat Food Brand Penetration
  - Table Cat Food Brands Purchased in Last 12 Months, 2018 (percent of cat-owning households)
- Cat Food Purchase Patterns by Channel
  - Table Cat Food Purchase Patterns by Channel, 2018 (percent of cat-owning households)
  - Table Cat Food Online Purchase Patterns by Website, 2018 (percent of cat-owning households)