A latest report from OC&C Technique Consultants, a world administration consulting agency, shared insights into the U.S. pet market. The report famous the U.S. canine and cat meals and treats market is at present valued at $50 billion, with the canine phase accounting for two-thirds of the spend whereas the cat phase is seeing elevated progress.
OC&C stated this progress has been pushed by premiumization, COVID-19 and inflation-driven components. Whereas progress has slowed prior to now two years, it’s anticipated to return to pre-COVID ranges over the subsequent 3 to five years, with premium merchandise persevering with to be a significant driver. Regardless of the premium phase already accounting for 30% of the pet food market (and 10% to fifteen% of the cat meals market), there stays additional potential, particularly in super-premium choices, stated Coye Nokes, companion at OC&C Technique Consultants.
“The U.S. is already essentially the most developed pet meals market, and we see loads of runway for additional progress,” stated Nokes. “Lengthy-run developments towards prime quality, pure and wholesome merchandise, and innovation throughout codecs and substances, all proceed to offer pet mother and father extra choices.”
7 key developments in excessive progress segments
As a part of the report, OC&C recognized 7 key developments in excessive progress segments of branded pet meals and treats, and the drivers behind client habits.
1. Fast progress in contemporary phase
Based on the report, specialists have seen the contemporary pet meals phase expertise fast progress, emphasizing pure and human-grade substances. This phase, which accounts for 10% to fifteen% of the premium pet meals market, is projected to develop from $1 to $2 billion in 2022 to $3 to $5 billion by 2027.
FreshPet’s retail-first technique, particularly within the U.S., has pushed market consciousness and adoption, outpacing direct-to-consumer (DTC)-led progress seen in Europe. Specialists anticipate contemporary pet food might attain 30% to 40% market penetration, with DTC methods unlocking new buyer segments and fostering loyalty.
2. Alternatives in super-premium pet meals
The premium phase is now well-developed with 30% of quantity in canine and 10% to fifteen% in cat, OC&C stated there are additional progress alternatives anticipated to return from innovation. Merchandise like freeze-dried, raw-coated kibble from manufacturers similar to Merrick present longer shelf life and simpler storage in comparison with frozen choices, making them extra accessible for premium patrons. This phase supplies a less expensive but premium various to different super-premium codecs.
3. Enlargement of combined feeding and topper merchandise
The combined feeding and topper product market is rising rapidly in accordance with the report, providing shoppers accessible methods to reinforce their pets’ dry kibble, bettering each style and dietary worth. Manufacturers like Petcurean and Tiki are growing merchandise that increase palatability by including moisture and taste to meals whereas incorporating energetic substances, similar to glucosamine, to assist well being.
These merchandise are positioned as a premium but accessible improve for pet homeowners, with vital gross sales progress for flavor-enhancing gadgets (greater than 27% yearly between 2019-2023) far outpacing general model progress (13% yearly).
4. ‘Purposeful pure’ blurs boundaries of the pure and scientific classes
Mixing pure substances with added well being advantages, the useful pure pet meals phase is rising because it provides health-focused claims with out veterinary endorsement, interesting to premium patrons at cheaper price factors. OC&C’s analysis instructed this class is gaining traction amongst just a few mainstream premium manufacturers, similar to Purina One, however sometimes at a cheaper price level in comparison with scientifically formulated merchandise.
Purposeful pure manufacturers have a presence in each mainstream and specialty retail channels, with premium merchandise extra typically present in specialty shops. The report discovered dry meals dominates this market, accounting for round 90% of quantity and 75% of worth, however profitable manufacturers additionally carried out properly throughout moist formulations. Moreover, latest gross sales of useful pure cat meals have outpaced the general market, rising at 15% yearly between 2019-2023, in comparison with 10% for the broader cat meals market.
5. Premium cat meals progress for the subsequent 5 years
The U.S. premium cat meals market is driving general market progress, projected to achieve $6 billion by 2028, with premium propositions rising at a 7% CAGR.
OC&C stated pure cat meals contains about 60% of the premium phase, with smooth pure codecs dominating, accounting for 70% of client spend. Tender pure merchandise give attention to emotive packaging, interesting to client preferences for high quality and palatability, whereas exhausting pure merchandise emphasize ingredient transparency and express well being claims. Tender pure has seen stronger progress because it aligns extra with cat homeowners’ needs for each emotional and dietary advantages.
6. Rising plant-based phase
Plant-based pet meals is a rising area of interest, with the report displaying round 20% of shoppers switching to vegan choices to enhance sustainability. Actions taken by these shoppers embody selecting environmentally pleasant packaging (58%) and switching to manufacturers with higher environmental (45%). ESG pioneers are main this development by specializing in sustainable substances, emphasizing dietary steadiness and selling plant-based messaging.
Retailers like Petco and PetSmart have expanded their plant-based deal with choices, reflecting a rising demand for sustainable pet meals alternate options.
7. Rise of single-ingredient, protein-driven merchandise
‘Wholesome pet food’ has seen a rise of 647% in month-to-month searches during the last 12 months, which the report stated exhibits client demand for health-conscious choices. That is growing recognition of single-ingredient pet merchandise, particularly in treats. Based on OC&C, these merchandise align with key developments similar to high-protein diets, as single-ingredient meat-based treats function glorious protein sources. Moreover, the clear label motion has boosted these merchandise’ attraction, as they’re minimally processed and marketed as “clear” or pure.
Easy-ingredient treats keep away from fillers, preservatives, and synthetic components, providing greater perceived high quality and security. This format has seen robust market success, exemplified by Nacho Eats, which has achieved roughly 60% annual progress between 2021 and 2023.
Learn the complete report right here.
Tailored from a press launch.
