The strong turnout surprised Petco employees, who figured the rain would keep people away. But maybe they shouldn't have been surprised. After all, pet ownership and attitudes about pets have changed considerably during the past decade. Study after study combined with reams of anecdotal evidence, show that pet ownership is at an all-time high, people are taking better care of their pets and spending more money on them. The combination of those two factors have transformed the pet care industry into a $35 billion marketplace, according to the American Pet Products Manufacturers Association.

The APPMA conducts a comprehensive survey every two years to assess trends in pet ownership and Americans' attitudes toward their pets. The most recent survey revealed that 63.4 million households have a pet, compared to 52.6 million households a decade earlier. In addition, the increased ownership of pets is broad-based with dogs, cats, fish, birds and small animals such as rabbits and ferrets found in more homes than ever before.

It is also worth noting that spending for every type of pet has increased, with trips to the veterinarian accounting for the largest part of the increase. People spent $562 caring for their dogs in 2000, compared to $405 in 1998, while expenses for cat owners increased to $484 from $371.

Another telling finding about the changing nature of the relationship between Americans and their pets relates to where animals sleep at night. In a nutshell, more dogs and cats are sleeping in their owners' beds and fewer are sleeping outdoors. A sizeable 36% of dogs sleep in their owners' beds while only 18% sleep outside. Half of the nation's cats sleep in their owners' beds compared to 15% who sleep outdoors.

A new measure of the emotional attachment people have to their pets can be found in the response to a new question APPMA added to the survey inquiring whether a casket would be purchased for a pet. Five percent said they would.

"Based on the number of pet owners, times the number of owners that might buy a casket, a potential of five million caskets could be sold," according to APPMA.

The desire of pet owners to take better care of their animals can also be found in the financial results of leading pet retailers. PetsMart employs stylists who go through a 15-week training program in order to provide services such as toenail trimming and tooth brushing, a cut, shampoo and style or training. As a result, PetsMart revenues from grooming and training increased 29% to $118 million last year.

People's fondness for their pets has even allowed for the creation of new business models. Pet Assure Holdings Inc. is a company that markets a discount card that provides 25% off select services at participating veterinarians. Two years ago the company began proaching employers to offer the service as a benefit to employees who wish to participate.

"Employers love it because they are able to offer something their employees adore," said Steve Jezek, vice president of benefits with Pet Assure.

He noted that companies such as Oppenheimer Funds, GMAC, Home Shopping Network and J.D. Powers offer Pet Assure to their employees.

The program doesn't cost employers anything, employees who enroll pay a fee to access discounts Pet Assure negotiates with veterinarians who participate in the program to generate additional business. The concept is similar to a managed care organization that aggregates demand in order to leverage lower costs from doctors and hospitals on behalf of those it covers. The biggest difference between the two, Jezek explained, is Pet Assure doesn't dictate to veterinarians how much they can charge.

It is a business that is able to exist today as a direct result of people's changing attitudes toward their pets.

"Twenty years ago the dog used to live in the backyard in a dog house. Now they live in the house, sleep under the covers and in a lot of cases are treated better than the rest of the family," Jezek said.

Americans' willingness to spend heavily on their pets spawned the pet superstore category killer concept more than a decade ago and today the two main operators of the format, PetsMart and Petco, are believed to be gaining market share from supermarkets and independent pet stores. PetsMart has grown its base of stores to 560 units from 468 units five years ago and its sales increased to $2.5 billion from $1.8 billion during the same time frame.

Petco meanwhile has grown its base of stores to 571 units from 457 units five years ago and its sales increased to $1.3 billion from $750 million during the same time frame.