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hanging lifestyles in the form of the rise in
nuclear families and double income
households have encouraged the growth
of pet ownership in urban areas of India.
Increasingly, pets are being looked upon as
companions and members of the family rather
than as guard dogs for example. Pet owners
have started to take an interest in their pet’s
diet, health and grooming. A gradual shift
towards prepared pet food has been observed.
Pet owners are more willing to spend on pet
food and pet care products than ever before.
This trend has spawned an entire industry, with
a growing emphasis on pet care.
Most of the branded pet food is imported. The
government’s reduction of the import duties on
pet food in 2007 provides a boost to both
manufacturers and importers.
But the ban on imported pet food due to the
outbreak of Avian Flu in year 2006, which
continued through 2007, resulted in the
reduced availability of pet food. A few foreign
brands such as Royal Canin and Bento Kronen
escaped the ban, but others like US brands Pro
Pac and Purina were impacted. On the other
hand, locally manufacturing looked up.
According to Euromonitor International,
veterinary clinics and pet shops remained a
leading distribution channels for pet food and
pet care products in 2007. But more and more stretches beyond the realm of vaccines and
extends to advice on pet food. Thus, over the MOST OF THE
retail outlets and supermarkets started
emerging as viable distribution channels. This years, manufacturers have pitched their BRANDED PET
has reduced the influence of vets on consumer products to vets, and focused on getting them to FOOD IS
purchasing decisions. recommend products to pet owners. Most vets IMPORTED. THE
in India sell pet food and pet owners traditionally GOVERNMENT’S
In the days to come, with pets increasingly being purchased pet food from vets. However, as pet REDUCTION OF
treated as companions and fashion owners become more familiar with different THE IMPORT
accessories, pet owners, especially in the urban brands of pet food and pet care, they are
DUTIES ON PET
areas, are expected to spend more on their increasingly becoming the decision makers and
pets. FOOD IN 2007
making their purchases elsewhere. This trend
was shown by veterinary clinics’ decreasing PROVIDES A
Key Trends and Developments share of retail value sales of pet food and pet BOOST TO BOTH
Pet owners in India have traditionally relied on care products; its share decreased by slightly MANUFACTURERS
vets to provide them with guidance on taking over four percentage points between 2002 and AND
care of their pets. The influence of vets 2007. This gradual decline in share indicates IMPORTERS.
A HUGE
IMPROVEMENT IN
BOTH THE
QUANTITY AND
QUALITY OF
CHINA’S
TRANSPORTATION
INFRASTRUCTURE
increased by selling ever more expensive helping to transform the country’s logistics IS HELPING TO
premium and super-premium products to industry, reducing distribution costs and opening TRANSFORM THE
existing consumers, there is far greater potential up new swathes of potential consumers to pet COUNTRY’S
for sales growth (in both volume and value food manufacturers. This has gone hand-in-hand LOGISTICS
terms) in luring pet owners who continue to feed with the spread of chain retailers, that are INDUSTRY,
their pets household scraps into the economy moving beyond the metropolitan areas of REDUCING
segment. Beijing and Shanghai to second- and third-tier DISTRIBUTION
cities. Pet superstore Cool Baby’s expansion COSTS AND
India, a market not wholly dissimilar to China in
into such markets as Nanjing and Yantai has
terms of its scale and development, illustrates OPENING UP NEW
been particularly notable in this regard. In the
how the potential of economy brands is not yet SWATHES OF
medium term, the spread of chain retailers into
being realised in China. The economy products POTENTIAL
the less developed provinces of mid- and west
accounted for 61 percent of total cat and dog CONSUMERS TO
China will provide an additional boost to sales.
food value sales in the country in 2007, up from PET FOOD
32 percent in 1998. A sustained marketing effort will also be MANUFACTURERS.
required to drive demand for economy products.
While the overall growth of Indian pet food and
Although China’s urban population is expanding
pet care products was less than that of China in
rapidly and should eclipse its rural counterpart
the 10 years to 2007, it is estimated that India sometime during the next decade, the country
will achieve a CAGR of 11 percent between retains many of the cultural characteristics of a
2007 and 2012, compared with a figure of 8.6 peasant society. This is of particular relevance
percent in China. The divergence in for the pet food market, as it is the continuance
performance between these two markets will of rural attitudes towards animals that is in
be at least partly the result of the relative many respects responsible for hampering the
narrowness of China’s pet food consumer base growth of economy pet food. By stressing the
compared to that of India. benefits of packaged pet food over household
Savvy pet food manufacturers can utilise these scraps, marketing can play an important role in
trends to grow their overall share of the Chinese breaking down these established attitudes in
market. This stratum of consumers is extremely order to promote anthropomorphism and
price-sensitive and high-volume, low-margin develop the market.
sales will be vital to profitability. As a result, Unlike the premium and mid-priced pet food
manufacturers that invest in local production segments, in which foreign firms are dominant,
facilities will gain an important additional cost indigenous firms are best placed to benefit from
advantage. any growth in economy pet food sales. Although
A huge improvement in both the quantity and this segment has been extremely fragmented, it
quality of China’s transportation infrastructure is would appear to be consolidating rapidly. For
Increasing pet ownership driven by smaller household Dog food, cat food, and small mammal food
sizes in developed markets
Pet humanisation Premium dog and cat food, dog and cat treats, and pet
care products
Increasing influence of consumer health awareness Functional dog and cat food, added-value other pet
on pet-related purchases food, dietary supplements and healthcare products
Development of an upper-mass segment bringing Dog and cat food, including dog and cat treats, with
premium qualities to the mass market functional properties
Pressure on living spaces in urban areas Small mammal/reptile food, fish food and products
targeting small breeds of dog
Accelerated consumer lifestyles creating demand for Dry dog and cat food, which is easier to serve and store,
convenient products with a longer shelf-life and less odour than wet
alternatives. Resealable pouch packaging for wet dog
and cat food
Increase in indoor pets Cat litter, dry dog and cat food
Expansion of pet superstores in major markets Premium dog and cat food, treats and pet care products
Ageing pet population due to healthier diets and Dog and cat food targeting specific, age-related medical
improved veterinary care conditions such as arthritis and diabetes
Increased segmentation Products targeting pets according to factors such as
age, breed, size, coat length and lifestyle
Growing consumer concern regarding the provenance Increasing demand for pet food made with ‘natural’
and manufacture of pet food ingredients, and organic products