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While pet parents continue humanising their pets, innovation has driven forward the industry with enticing products, designed more to please humans. Breaking out products by breed, by age and by lifestyle has been key to maintaining consumers’ interest and driving growth. Also, better quality products with functional ingredients, added functionality and novel proteins has been a key selling point, particularly as consumers trade up from mid-price offerings.
Segmentation by breed has been quite relevant in recent years as consumers look to better adapt their pets’ functional needs to meet their nutrition needs. Moreover, the fact that nutrition plays a key role in pets’ overall healthy development has further boosted the idea of how key nutrition is. Recent developments in the industry have also combined particular breeds with their different life stages and lifestyles in order to create even more fine-tuned and targeted nutrition. While this may not be radically new in the most developed markets, it is still important to analyse its development and differences in specific markets as these strategies can be pursued by different manufacturers at different times.
With the industry becoming increasingly competitive and growth becoming harder to find in many of the traditional markets, segmentation has played a key role in driving growth and attracting interest to the category as well as differentiating from competitors. Key underlying trends such as the rise of small dogs have been at the core of such developments as food is catering to their specific needs. Small dogs and toy breeds have become increasingly popular across a number of markets. Experiencing 25% growth between 2013 and 2018, the popularity of small dogs has become a global phenomenon and has driven much of the recent development in pet food, providing further segmentation and higher margins for the industry.
Overall, with better pet nutrition as well as the level of care and scientific advances, similar to humans, pets are also living longer. This creates new needs in terms of fighting signs of older age in pets as well as ailments that are more common with such pets. Brain health is one of the areas where there are plenty of developments and ingredient manufacturers have invested in considerable research into the most effective ingredients that support specific conditions.
With the rise in consumer demand for greater transparency and the quest for greater quality, the inclusion of ingredients’ provenance and origin can add great value. This is related to contamination scares and several past scandals in the supply chain. This is even more acute in the US due to the melamine scare (back in 2007); consumers remain acutely aware of origin and manufacturers.
With fears over contaminants and recall scares, certain markets come out top when appropriate labels are displayed. With increasing numbers of savvy consumers, who continuously browse the internet, research and debate on social media, transparency in terms of ingredient lists has become increasingly important. Directly related to this is the fact that food scares have also taken place and consumers are therefore more conscious in terms of manufacturing countries and from where ingredients are sourced.
Regionally-sourced ingredients and locally-manufactured products are appealing to more consumers who are following wholesome lifestyles. Advocating a biologically appropriate diet to fulfil dogs and cats’ evolutionary needs, Champion PetFoods is the largest Canadian manufacturer of natural dog and cat food, sourcing ingredients from local farmers, ranchers and fishermen.
Despite US dog food brands continuing to account for a major share of dog food sales, Canadian manufacturers are taking share in dog food with their increasing natural and organic product offerings. Pet owners view “Made in Canada” brands more positively as most of these manufacturers are independent from large corporations, which are perceived as more profit driven. Champion PetFoods, the owner of the Acana and Orijen brands, is the most successful Canadian manufacturer in dog food and sets a high standard for the pet food industry. An increasing number of local small manufacturers work with pet speciality stores to expand their presence. PetCurean is another successful Canada based company whose products display the “Proudly Canadian”.