Engaging the pet parent generation

Market expands

In the second quarter of 2021, pet product sales in the US increased to nearly $40 billion (€34 billion) and pet food alone was the fifth largest Consumer Packaged Goods (CPG) category, with sales of $22.2 billion (€19 billion) according to IRI data. Pet aisle sales in total are up a dramatic 15% over 2019 levels.

The average consumer basket has grown 6.4% to nearly $80 (€69) over the last year, but the number of trips to retailers has remained flat. In that timeframe, the jump in sales at warehouse club stores is more pronounced than any other type of retailer, with dollar and unit sales growing 8% and 9.7% respectively.

Channel differences

COVID-19 generated an unprecedented worldwide increase in online shopping, and omnichannel pet purchases jumped 22% in 2020. 31% of online shoppers say they visit fewer brick-and-mortar stores than they used to, and this limited in-store sales growth.

When consumers opt to shop online instead of in-store, the dynamics of the shopping experience change. Online shoppers tend to repurchase products they already know.

Shopping in stores presents greater opportunities for browsing and engaging with brands and products that consumers might not have used before, enabling more growth for individual brands and retailers. Specialty pet retailers have demonstrated the power of offering pet services, including grooming and training – even socialising – as a way to build basket sales and loyalty.

Post-COVID?

With COVID-19 potentially receding, two critical questions emerge. Which shoppers can brands and retailers get back into stores? And what promotion, pricing and other marketing strategies will get them there?

In order to harness the continuing growth opportunities for pet products in the coming months, retailers and brands should pay attention to two key trends: the pet parent generation and worldwide interest in health and wellness.

Gen Z and millennials

Interacting with Generation Z and millennials is key to achieving sustained growth. The opportunity CPG companies have to engage successfully with this market is fourteen times larger in sales value growth than with other generations. Younger millennials and Gen Z also overindex for specialty retail like pet stores.

Compared to other generations, more Gen Z-ers buy specialty pet items, including outfits and therapeutic beds (38% and 31% respectively). And millennials are more likely to buy treats and specialty foods to accommodate their pets’ life stages (38% and 22% respectively).

What retailers can do

How should pet retailers attract shoppers that usually buy pet products on their weekly grocery run? To harness the opportunities offered by self-care trends, these retailers should offer unique, wellness-focused products that complement in-store wellness and grooming services. Their strategy should also aim to effectively integrate online and in-store experiences – to capture shoppers driven by the convenience of buying online and those who prefer interacting with products.