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Premium fare drives pet care sales
New and improved products and the marketing dollars behind them are driving growth in the U.S. pet food market. According to Packaged Facts, retail sales of pet food are projected for a steady climb, rising to an estimated $16.7 billion by 2008 from $13.1 billion in 2003. The, key: People are feeding their pets the same way they re feeding their families.
"Today the most important trends in pet food involve premium and super-premium fare covering all bases from natural/organic to functional/nutraceutical to highly segmented nutrition by breed, condition, age to humanized products, ranging from pet candy to kosher fare,
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and more convenient products based on new or improved forms,
such as food bars, and package types, such as single-serve pouches, researchers wrote in the June report "The U.S. Pet Food Market by Packaged Facts/MarketResearch.com.
As health-conscious Americans think about themselves and their families, those nutritional aspects increasingly are carrying over to their pets.
"Because the pet's status in the family is rising, consumers are more interested in the feeding experience," said Steve Sholtes, manager of industry affairs with Procter & Gamble, which owns the Iams pet care brand.
Consumers also are trading up to give their pets the best feeding experience possible.
"People without children, including singles, empty nesters, childless couples and gay couples, are significantly more likely than average to buy more expensive pet products ... since [they are more] likely to treat their pets like children and not actually having children frees up a good deal of discretionary income," Packaged Facts researchers reported.
Holiday sales also could provide retailers a boon in the pet food category. Karen Kenny, manager of consumer and marketplace insight for Nestle/Purina, said research shows Christmas is the primary gift season for pets, with more than three-quarters of dog owners and two-thirds of cat owners buying gifts for their pets. Kenny also said nearly 50 percent of all snacks and treats are sold during the two-month period from the beginning of November to the end of December.
Even with limited shelf space, retailers can tie in to holidays with themed shippers or quarter pallets, which can encourage multiple purchases, impulse buys on items like stocking stutters and "just because" gifts for reasons like one's pet has been home alone all day.
Drug store retailers that get the kind of relationship that "just because" consumers have with their pets stand to win over an extremely valuable consumer base.
"The pet food consumer is shopping more than just the pet food aisle," said Paul Cooke, vice president of trade and industry development with Nestle/Purina. They tend to be higher-income, family-oriented, multi-category purchasers. The reality is, if you are going to carry a limited assortment, you have to be able to have a product mix that meets a consumer's needs. Assortment and product availability is always more important than price. People aren't necessarily looking for the cheapest price, they are looking for the best value."
Procter & Gamble set the stage for bringing value to mass when it rolled out its premium brand Iams to 25,000 new retail outlets in 2000. "Bringing this premium brand to mass strengthened the credibility of mass retailers' pet departments in the eyes of discriminating pet owners," wrote Packaged Facts researchers.
Iams dry dog food, up 8 percent in dollar sales and 5.6 percent in unit sales, currently holds the No. 1 spot in food, drug and mass, excluding Wal-Mart, according to Information Resources Inc. data for the 52 weeks ended Sept. 5.
COPYRIGHT 2004 Reproduced with permission of the copyright holder. Further reproduction or distribution is prohibited without permission.
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