After China's economy has shifted from a stage of high-speed growth to a stage of high-quality development, the pet economy has also ushered in a period of high-speed growth. Judging from the pet food companies that have emerged in my country in recent years, the product structure is basically dominated by pet snacks. In 2020, the CR5 of my country's pet snack market will be 32.7%. The two companies with the highest market share, Zhongchong and Petty, are both domestic companies. Among the top ten manufacturers, there are only two foreign-funded manufacturers, Mars and Dogman.
Relying on the competitive advantages in the pet snack market, domestic pet food companies have begun to increase their layout in the pet staple food market in recent years, and continue to expand their development space.
Thriving pet market track
According to the "2021 White Paper on China's Pet Industry", the number of people raising dogs and cats in my country will reach 68.44 million in 2021, an increase of 8.7% compared with 2020. The number of dogs and cats in cities and towns across the country is 36.19 million and 32.25 million, The scale of cat raising is smaller than that of dog raising, but the growth rate is higher. People's spiritual needs for companionship with pets are becoming increasingly prominent. At present, the scale of the consumer market has reached 249 billion yuan, an increase of 20.58% over 2020, and the growth rate has returned to the pre-epidemic level.
With the continuous improvement of the penetration rate of pet families and the maturity of the industry, the market size of my country's pet industry has shown a steady increase. It is estimated that the market size of my country's pet industry will reach 269.3 billion yuan in 2022.
In the pet market, pet food is a rigid demand for pets, which runs through the entire life cycle of pets. It has high repurchase, low price sensitivity, and strong stickiness, accounting for about 51.50%. Therefore, the pet food market will be the largest market segment in the pet industry, and will be the first to benefit from the development of the pet economy.
Market trends under cultivation
International experience shows that the people's economic level is closely related to the development of the pet food market. The development of the domestic economy and the increase in per capita disposable income drive the expansion of pet consumption demand. Nowadays, the per capita income level of Chinese residents is constantly increasing, which has promoted the continuous upgrading of consumption, and the pet food market has also grown accordingly.
Especially since my country's reform and opening up, per capita disposable income has increased rapidly, material life has become more abundant, and people have paid more and more attention to the satisfaction of spiritual needs. Nowadays, pets not only serve as people's emotional sustenance, but also gradually become an important member of the family.
The family attributes of pets are gradually becoming prominent, and pet consumption has become emotional consumption, which has greater demand space and sustainability than material consumption.
With the transformation of domestic pet owners' pet-keeping methods and the change of pets' roles towards partners, the family attributes and status of pets have gradually stabilized, and pet owners have a close relationship with their pets. According to market research, more than 50% of pet owners regard pets as children/relatives.
In addition to the impact of the epidemic in 2020, the annual growth rate of the pet food industry market has mostly remained above 20% since 2012, with an average annual compound growth rate of 26.28%, far exceeding the world average of 6.17%.
Increasing demand for high-end products
With the continuous improvement of residents' living standards and the improvement of pet family status, people's awareness of feeding commercial food has also been further improved, and the market demand for pet food will be further released.
Beginning in 2019, the term "poisonous food" also began to appear in the eyes of consumers with high frequency, which aroused high vigilance in the market. Searching for "poisonous food" on the black cat complaint platform of the consumer rights protection platform can find overwhelming complaints and feedback. Many brands have been included in the "poisonous food" blacklist and abandoned by the market.
The "poisoned food" incident shows that the demands of pet owners have gradually shifted to the direction of refined and scientific pet raising, and they also have a higher pursuit of the quality and health of pet food. They are willing to pay a higher price for better quality and raw materials. Healthier, even tailored pet food.
Due to the increase of pet owners, the market category of pet food is also becoming more and more abundant. For example, pet mooncakes approaching the Mid-Autumn Festival. These pet mooncakes are more expensive than mooncakes eaten by many people, and the packaging is also very delicate.
For example, the price of "Mao Boy Mooncakes" in Sam's Selection Supermarket is 78 yuan per 4 pieces, and 19.5 yuan per piece, which is not cheap in the mooncake market. According to the statistics of this year's mooncake market by CDA data analysts, according to the normal gift box of 6-8 pieces, the corresponding price of pet mooncakes should be 117-156 yuan, and the price can almost beat half of ordinary mooncakes.
"Big cake" coexists with challenges
China's pet market is still in its early stages, and the industry prospect can be described as a "blue ocean". In recent years, domestic brands have also benefited from e-commerce channels and deployed in the domestic market with the advantage of high cost performance, quickly grabbing a lot of market share. But there is still a gap compared with European and American brands of pet food.
China's pet food industry started from foreign trade processing, that is, as a raw material supplier and production and processing place for the European and American pet markets. Before 2018, there were no binding standards for the production of pet food. In the sensational American pet food contamination incident in 2007, the United States accused the raw materials imported from China of containing melamine.
According to statistics, pet food safety problems mainly focus on harmful raw materials, bacterial contamination, unqualified hygienic packaging, insufficient nutrition, misleading product label information, etc. These problems endanger the basic life and health of animals, reflected in various " Poisoned food” incident. As a result, the reputation of domestic pet food companies has plummeted.
In this context, on June 1, 2018, the "Pet Feed Management Measures" issued by the Ministry of Agriculture and Rural Affairs was officially implemented. This is the first management method issued by China for pet food, which puts an end to the state where pet food production cannot be followed. China has become one of the few countries in the world that has binding standards for the pet food industry. For industry entrepreneurs, there is a better access environment.
The pet industry in developed countries in Europe and the United States started early and developed maturely. Therefore, China has become the world's foundry of pet food at a certain stage. From equipment, research and development to raw materials, China has a strong and self-sufficient supply chain. From production to sales, it basically learns from Europe and the United States. model.
Following the development of the domestic pet industry, my country has gradually transformed into a consumer market that pet food companies from all over the world are vying for. The development of the domestic market has also stimulated the development of domestic brands: correspondingly, a business model driven by two markets of "domestic + foreign" has been formed, and the business is growing at a high speed. It can be said that the next ten years will be a blue ocean to be developed, and the rise of domestic brands in the pet market is just around the corner.