Research project conducted in the summer of 2016 in completion of the MBA program at Wilkes University.

1. Trends in the Pet Industry
Linda Evans
MBA 592
Dr. Jennifer Edmonds

2. Agenda
 Introduction
 Pet Industry Trends
 Pet-Related Expenses
◦ Food Expenses
◦ Pet Supplies
◦ Veterinary Expenses
 Humanization of Pets
◦ Pet Insurance
◦ Pet Travel
◦ Funeral Services
 Other Accommodations
◦ Pet Boarding/Day Care
◦ Pet Grooming
◦ Pet Training
 Conclusion

3.  Pet Expenses
Introduction
 Pet Ownership:
Year Pet Ownership %
1988 56%
2015 65%
1994 2015 2016
$17B $60.3B $62.8B
 46% of households own more than 1 pet

4. Introduction
 What is the Pet Industry?
38.3%
23.9%
25.4%
3.4%
9.1%
Food
Supplies
Veterinary Care
Animal Purchases
Pet Services

5. PET INDUSTRY TRENDS

6.  Most commonly owned pet?
Consumer Trends
31% 5%27% 25%
 Pet Ownership by Demographic Groups
6%
16%
17%
25%
22%
11%
5%
< 25 25-34
35-44 45-54
55-64 65-74
> 75

7.  Pets as part of the family
 Feelings toward pets now
◦ 60% stronger feelings vs. as a child
◦ 67% care more vs. parents
 Reasons for these trends
Consumer Trends
2011 2016

8.  Supermarkets to pet retailers
 Market share:
Retail Trends
37.2%
23.3%
39.5%
PetSmart
PETCO
Other
Year Revenue
2016 $18.5 billion
2021 $21.6 billion
 Estimated Revenue:

9. PetSmart vs. PETCO
 Established 1987
 1,400 Stores (U.S., Canada,
Puerto Rico)
 2016 expected revenue =
$7.2 billion
 Offerings:
◦ Consumables
◦ Hard goods
◦ Pets
◦ Services
 Established 1965
 1,400 Stores (U.S., Mexico,
Puerto Rico)
◦ Unleashed
◦ Dr. Foster & Smith
 2016 expected revenue =
$4.5 billion
 Offerings:
◦ Food
◦ Supplies
◦ Pets
◦ Services

10. PET-RELATED
EXPENSES

11.  Definition
◦ Edible items purchased for pet consumption
◦ Expected expense of $24 billion in 2016
◦ Annual expenses:
Food Expenses
Expense Type Dogs Cats
Food $269 $246
Treats $61 $51

12.  Consumer Trends
◦ Natural Products
◦ Health Conscious
◦ Special Needs
 Retail Trends
◦ Places to purchase
 Pet Retailers
 Grocery Stores/supercenters
 Veterinarian offices
 Online
◦ Expanded food selection
Food Expenses

13.  Definition
◦ Necessary vs. Luxury Items
 Consumer Trends
◦ Environmentally friendly
◦ Demand for new products
 Clothing
 Furniture
 Retail Trends
◦ Broad offerings
◦ Medication
Pet Supplies

14.  Definition:
◦ Visits to the veterinarian for medical services
◦ Average Expense per year:
 Consumer Trends
◦ Advanced health care
◦ Decreases in visits to the veterinarian
 Retail Trends
◦ Vet locations/prescriptions in retail
◦ Specialized Training
Veterinary Expenses
Vet Expense Dogs Cats
Routine Visits $235 $239
Surgical Visits $551 $398

15. Veterinary Expenses

16. HUMANIZATION OF PETS

17.  Definition
◦ Similar to human insurance: deductibles, co-
pays, etc.
◦ Differences
 No network of veterinarians
 Pay first, reimbursed later
◦ Other:
 Waiting periods
 Pre-existing conditions
Pet Insurance

18.  Consumer Trends
◦ High Vet Expenses leads to demand for
insurance
 Average pet claim: $547
 80% of pets will experience a medical emergency
◦ Pets considered family
 Retail Trends
◦ 10 U.S. Insurance Companies
◦ Employer offered pet insurance
Pet Insurance

19.  Definition
◦ Expenses related to transporting a pet from
one location to another
 Consumer Trends
◦ Willingness to travel after a pet
◦ Taking pets on the road
◦ Demographics
 Retail Trends
◦ Airplanes
◦ Hotels
Pet Travel

20.  Definition
◦ Services performed after a pet’s passing
 Consumer Trends
◦ Humanization of pets
◦ Emotional expression
 Retail Trends
◦ Pet memorial offerings at funeral homes
◦ Keepsake offerings
Funeral Pet Services

21. OTHER
ACCOMMODATIONS

22.  Definition
◦ Locations that care for
pets while owners are away
 Consumer Trends
◦ Pet humanization
◦ Effects of socialization
 Retail Trends
◦ Local Offerings
 Assessments/applications
◦ Pet Store Offerings
 Upgrade options
Pet Boarding & Day Care

23. Pet Grooming
 Definition
◦ Products/services related to cleaning a pet
◦ Annual Expenses:
 Dogs = $83
 Cats = $33
 Consumer Trends
◦ Humanization – Health & Hygiene concerns
◦ Awareness of ingredients
◦ Demographics on grooming
 Retail Trends
◦ Products to use at home
◦ Grooming at pet stores
 Expanded offerings

24.  Definition
◦ Teaching skills for obedience and safety
 Consumer Trends
◦ Busy schedules
◦ Humanization/Proper behavior
◦ Increase in Training Careers
 Retail Trends
◦ Training classes
 Different Levels
◦ One-on-one training options
Pet Training

25.  Summary
◦ Pets are part of the family
◦ Expression of emotions
◦ Busy schedules
Conclusion
 Opportunities
◦ Millennial spending
power
◦ Pet travel
◦ Restaurants
◦ Colleges
◦ Technology
 Challenges
◦ Online competition
◦ Recessionary
periods
Opportunities Challenges
 Effect on business

26. Questions?

27. References
 American Pet Products Association (APPA). (2016). Pet industry market size & ownership
statistics. Retrieved May 11, 2016 from
http://www.americanpetproducts.org/press_industrytrends.asp
 Becker, K. (2012). Is every trip to the vet traumatic for your pet? This “mobile vet clinic”
could be for you. Retrieved August 4, 2016 from
http://healthypets.mercola.com/sites/healthypets/archive/2012/02/17/mobile-veterinary-
clinics.aspx
 Boncy, J. (2012). Pet retailers bite back. Retrieved July 24, 2016 from
http://www.petbusiness.com/November-2012/Pet-Retailers-Bite-Back/
 Carter, B. (2016). IBISWorld industry report 45391: Pet stores in the US. Retrieved May
15, 2016 from https://www.ibisworld.com/gosample.aspx?cid=1&rtid=101
 Casciotti, D. & Zuckerman, D. (2016). The benefits of pets for human health. Retrieved
June 20, 2016 from http://center4research.org/healthy-living-prevention/pets-and-health-the-
impact-of-companion-animals/
 CATCH Canine Trainers Academy (2016). Dog training careers are on the rise. Retrieved
July 23, 2016 from http://catchdogtrainers.com/trainer-careers/dog-training-on-the-rise/

28. References
 Conway, A. (2016). Top 40 pet global food companies: 2015 data now available. Retrieved
June 25, 2016 retrieved from http://www.petfoodindustry.com/articles/5823-top-40-pet-
global-food-companies-2015-data-now-available
 Cook, D. (2015). Big growth expected for pet insurance. ALM Media, LLC. Retrieved July
24, 2016 from http://www.benefitspro.com/2015/04/24/big-growth-expected-for-pet-
insurance
 Coren, S. (2011). Do we treat dogs the same way as children in our modern families?
Retrieved June 21, 2016. https://www.psychologytoday.com/blog/canine-corner/201105/do-
we-treat-dogs-the-same-way-children-in-our-modern-families
 Day care has gone to the dogs. (2000, July 13). Christian Science Monitor. p. 12. Retrieved
July 23, 2016 from Wilkes University EBSCOhost.
 Dicks, M. (2014). Data suggest veterinary market will improve in 2015. Retrieved May 15,
2016 from https://www.avma.org/PracticeManagement/BusinessIssues/Documents/Data-
suggests-veterinary-market-will-improve-in-2015.pdf
 DogVacay.com. (2013). State of pet travel in the U.S. Retrieved July 15, 2016 from
https://dogvacay.com/img/infographics/dogvacay-state-of-pet-travel-us-2013.png

29. References
 Embrace Pet Insurance. (2016a). Facts & statistics on the US pet insurance industry.
Retrieved July 15, 2016 from http://www.embracepetinsurance.com/pet-industry/pet-
insurance/statistics
 Embrace Pet Insurance. (2016b). Pet business trends 2013. Retrieved August 6, 2016 from
http://www.embracepetinsurance.com/pet-industry/pet-trends/2013
 Farmers Group Inc. (2016). What is pet insurance and what does it cover? Retrieved July
15, 2016 from https://www.farmers.com/inner-circle/home-tool-kit/what-is-pet-insurance/
 FranchiseHelp Holdings LLC. (2016). Pet care industry analysis 2016 – Costs and trends.
Retrieved May 30, 2016 from https://www.franchisehelp.com/industry-reports/pet-care-
industry-report/
 Furore, K. (2016). The well-groomed pet. Progressive Grocer, 95(5), 114-116. Retrieved July
23, 2016 from Wilkes University EBSCOhost.
 Grant, A. (2012). Veterinarians scramble as retailers jump into pet meds market. Retrieved
July 13, 2016 from
http://www.cleveland.com/business/index.ssf/2012/01/vets_scramble_as_retailers_jum.html

30. References
 H., M. (2010). Pets allowed: Developing friendly policies. University Business, 13(7), 18.
Retrieved July 23, 2016 from Wilkes University EBSCOhost.
 Harris, K. (2016). Some companies allow pet bereavement time to employees…should it be
mandatory? Retrieved June 30, 2016 from http://iheartdogs.com/some-companies-allow-
pet-bereavement-time-to-employees-should-it-be-mandatory/
 Hawes, J. (2014). Funeral industry meets growing demand for pet cremation and pet rituals.
Retrieved June 5, 2016 from
http://www.postandcourier.com/article/20141108/PC1204/141109489/1002/funeral-industry-
meets-growing-demand-for-pet-cremation-and-grief-rituals
 Hechinger, J. (2005, May 25). Getting into day care is becoming harder for today's dogs.
Wall Street Journal - Eastern Edition. pp. A1-A6. Retrieved July 23, 2016 from Wilkes
University EBSCOhost:
http://search.proquest.com.ezproxy.wilkes.edu/docview/398957569?accountid=62703
 Home Away. (n.d.). A guide to pet travel trends. Retrieved July 15, 2016 from
http://blog.koa.com/wp-content/uploads/pettraveltrends.pdf

31. References
 Irving Place Capital. (2014). No begging necessary for consumer demand in the pet
industry. Retrieved May 15, 2016 from http://www.irvingplacecapital.com/2014/03/18/no-
begging-necessary-for-consumer-demand-in-the-pet-industry-pet-supplies-plus-poised-for-
major-growth-to-keep-up-with-increasing-demand-for-pet-products/
 Kirillova, K., Lee, S., & Lehto, X. (2015). Willingness to travel with pets: A U.S. consumer
perspective. Journal Of Quality Assurance In Hospitality & Tourism, 16(1), 24-44.
doi:10.1080/1528008X.2015.966296. Retrieved July 18, 2016 from Wilkes University
EBSCOhost.
 London, K. (n.d.). Eight new dog training trends. Retrieved July 23, 2016 from
http://thebark.com/content/eight-new-dog-training-trends
 Mantle, S. (2015). Pet industry 2015. Pet Age. Retrieved May 15, 2016 from
http://www.petage.com/pet-industry-2015/
 Marton, M. (2014). Fashion forward. Pet Age. Retrieved July 24, 2016 from
http://www.petage.com/fashion-forward/
 Marton, M. (2016). 2016 trends in the pet industry. BlogPaws. Retrieved May 11, 2016 from
http://blogpaws.com/executive-blog/2016-trends-in-the-pet-industry/

32. References
 MedicAnimal. (2016). 8 FAQs about different types of dog food. Retrieved June 26, 2016
from https://www.medicanimal.com/8-FAQs-about-different-types-of-dog-food/a/ART111513
 Moore, A. (2004). Brush up on your grooming skills. Prevention, 56(8), 176-178. Retrieved
July 23, 2016 from Wilkes University EBSCOhost.
 Nationwide. (n.d.). Bird & exotic pet insurance. Retrieved August 4, 2016 from
http://www.petinsurance.com/birds
 North American Pet Health Insurance Association (NAPHIA). (n.d.). The pet health
insurance industry in North America. Retrieved July 16, 2016 from
https://naphia.org/industry/
 Ongoing 'humanization' of pets good for business. (2012). MMR, 29(2), 18. Retrieved July
18, 2016 from Wilkes University EBSCOhost.
 Outlook for health-related products is favorable. (2012). MMR, 29(2), 18. Retrieved July 18,
2016 from Wilkes University EBSCOhost.
 Pendrill, K. (2016). Boozy canine-friendly menus. Retrieved July 24, 2016 from
http://www.trendhunter.com/trends/winged-ox

33. References
 Pet care undergoes humanization. (2016). MMR, 33(6), 71. Retrieved July 18, 2016 from
Wilkes University EBSCOhost.
 PetCareRx. (2011). Top trends in pet care supplies. Retrieved July 24, 2016 from
https://www.petcarerx.com/article/top-trends-in-pet-care-supplies/6
 PetDiets. (2016a). Where to buy? Retrieved June 26, 2016 from
https://www.petdiets.com/library/pet-foods/marketing
 PetDiets. (2016b). Pet foods – Diet types. Retrieved June 26, 2016 from
https://www.petdiets.com/library/pet-foods/about
 PetSmart Home Office, Inc. (2016a). Dog grooming services. Retrieved July 23, 2016 from
http://pets.petsmart.com/services/grooming/dog-grooming-
services/?gclid=CIv70LyEi84CFU9Zhgod0vkC_A
 PetSmart Home Office, Inc. (2016b). PetSmart training. Retrieved June 5, 2016 from
http://pets.petsmart.com/services/dog-training/
 PetSmart Corporate (2016c). Company history. Retrieved June 22, 2016 from
http://phx.corporate-ir.net/phoenix.zhtml?c=93506&p=irol-timeline

34. References
 PetSmart Corporate (2016d). Company information. Retrieved June 22, 2016 from
http://phx.corporate-ir.net/phoenix.zhtml?c=93506&p=irol-homeprofile
 PetSmart Home Office Inc. (2016e). PetSmart petshotel. Retrieved July 17, 2016 from
http://pets.petsmart.com/services/petshotel/
 PetSmart Home Office Inc. (2016f). PetSmart doggie day camp. Retrieved June 5, 2016
from http://pets.petsmart.com/services/doggie-day-camp/
 Petswelcome.com, Inc. (2016). Pet friendly hotel chains. Retrieved July 16, 2016 from
http://hotels.petswelcome.com/chains/
 Phillips-Donaldson, D. (2016). Pet food spending in US rises over 350% in past 30 years.
Retrieved June 26, 2016 from http://www.petfoodindustry.com/blogs/7-adventures-in-pet-
food/post/5864-pet-food-spending-in-us-rises-over-350-in-past-30-years
 Profile America. (2006). Kennels and pet boarding. Retrieved July 17, 2016 from
http://www.heraldtribune.com/assets/pdf/advtips/IQ_KennelPetBoarding.pdf
 Queen, J. (2016). What is the pet industry? Retrieved May 30, 2016 from
http://www.wisegeek.net/what-is-the-pet-industry.htm

35. References
 Salerno, K. (2015). Sniffing out the best pet friendly airlines. Retrieved July 16, 2016 from
https://www.tripit.com/blog/2015/01/sniffing-out-the-best-pet-friendly-airlines.html
 Samuel, L. (2016). 9 human health trends that have gone to the dogs (and cats). Retrieved
July 13, 2016 from http://www.pbs.org/newshour/rundown/9-human-health-trends-dogs-and-
cats/
 Silva, D. (n.d.). Pet supply. Retrieved July 24, 2016 from http://www.sbdcnet.org/small-
business-research-reports/pet-supply
 Six trends set pace for pet market. (2006). Souvenirs, Gifts, & Novelties, 45(1), 104-111.
Retrieved July 18, 2016 from Wilkes University EBSCOhost.
 Synchrony Bank. (2016). Veterinary expenses. Retrieved July 16, 2016 from
http://www.carecredit.com/vetmed/
 Watt Global Media. (2016). Top pet food companies. Retrieved June 25, 2016 from
http://www.petfoodindustry.com/directories/211-top-pet-food-companies

36. References
 Wilkerson, F. (2016). What is pet insurance? Retrieved July 15, 2016 from
http://www.petmd.com/centers/insurance/evr_what_is_pet_insurance#
 Williams, G. (2015). Is pet insurance worth the expense? Retrieved July 15, 2016 from
http://money.usnews.com/money/personal-finance/articles/2015/06/11/is-pet-insurance-
worth-the-expense
 Woo, C. (n.d.). Organics, raw meat, and designer diets: New trends in dog food. The Bark.
Retrieved June 25, 2016 from http://thebark.com/content/organics-raw-meat-and-designer-
diets-new-trends-dog-food
 Young, L., & Gutner, T. (2004). A suite for Fido. Businessweek, (3879), 129. Retrieved July
23, 2016 from Wilkes University EBSCOhost.