United Arab Emirates consumers swing towards dogs, holistic pet food, and online shopping

Evolution

Historically, UAE has been considered a nation of cat lovers. Basically, having any pet is traditionally perceived as evidence of the high social status of its owner in the country, but dogs are seen as unclean animals by most Muslims. However, the number of dogs has been seen expanding in UAE in the past few decades, to some extent owing to a rising number of expatriates living in the country.

For instance, the total expat population in UAE has now come to 8.84 million, which constitutes approximately 89% of the country’s population – a figure pet food companies must reckon with.

Market size

The Dubai Chamber of Commerce and Industry estimated that retail sales of pet food in the UAE nearly doubled between 2013 and 2018, reaching 255.9 million dirhams ($69.7 million). Sales of cat food jumped from 75.3 million dirhams ($20.5 million) to about 138.7 million dirhams ($37.8 million), remaining the largest segment of the market.

However, sales of dog food are gradually catching up, increasing from 55.9 million dirhams ($15.2 million) to about 106.3 million dirhams ($28.9 million), the Chamber of Commerce and Industry reported.

Research conducted by the consulting agency IMARC Group showed that the pandemic had not impaired the growth of the UAE pet food market. For instance, dog food sales climbed further to $33.3 million in 2020. IMARC Group also expects the UAE pet food market to reach a value of US$121 million by 2026.

The landscape

The UAE pet food market is currently dominated by importers. The largest supplying countries are Thailand, France, Australia, and New Zealand, according to the Chamber of Commerce and Industry. The largest local distributors are Arab Land Trading LLC and Saint Vincent Group.  In line with the global trends, the market experiences a strong humanization trend, pushing customers to increasingly opt for more expensive pet food, and holistics.

“Customers switching to premium pet food are a growing and important trend in the UAE. They turn to expensive pet food, and those natural, organic, or gluten-free,” the analysts of the Chamber of Commerce and Industry said.

“The market is getting more sophisticated,” commented a source in a local pet food importer. “There is a popular saying that people start treating their pets like family members, and it is true. There is a sustainable and strong demand for good pet food as customers care about weight, allergies, and dietary tolerances of their pets, and so the market welcomes new products offering health benefits to pets”.

Online vs. offline

The Covid-19 pandemic has also pushed pet food sales in the country into the online segment. The UAE retail e-commerce market reached a record $3.9 billion in 2020, a 53% year-over-year increase driven by the Covid-19-led digital shift, according to the official statistical data. The basic forecast envisages the value of the market to reach $8 billion by 2025.

Currently, it is believed that 16% of pet food in UAE is being sold online, twice of the pre-coronavirus times. The country has a 99% of Internet penetration – the highest in the region, which is likely to facilitate further growth in online sales.

In the background, the analysts of the Chamber of Commerce and Industry anticipate the development of small businesses in the pet food market.

“If the development of the online pet food sales channels continues, a time will come in the when most people can buy pet food online instead of groceries. This may open wide opportunities for small companies working in this field, since they would be able to deliver their products to their customers directly, including through their mobile applications,” the analysts forecasted.