Britain’s cats and dogs have emerged from 2020 licking their lips. Throughout the year, petcare enjoyed robust sales as the nation turned to their furry companions for comfort.
Nowhere has growth been more obvious than with convenience retailers who, despite traditionally playing a small but important role in the category, have emerged as a driving force behind growth.
Delivering an impressive +11% retail sales value growth for petcare (Nielsen), the last year has seen more consumers than ever using the convenience channel for larger, weekly shops, choosing to stay local and avoid crowded areas as the pandemic struck.
There has been a notable shift in the total market, with petcare value moving away from grocery throughout the pandemic.
Mirroring the switch to local providers, the convenience channel’s share of petcare sales grew by 0.2% to 5.4% (Nielsen), while online value sales grew over 16% in the same period.
Whilst the short-term impact has been significant, there are signs that these habits are here to stay.
A third of pet owners bought food online for the first time during lockdown, and 55% of these intend to continue shopping this way during 2021 (Nielsen).
Alex Smith, Channel Manager, Convenience; Mars Petcare UK, comments: “We expect to see similar developments, with the convenience and wholesale channel forming a significant segment of our projected 2.4% compound annual growth over the next five years.”
The pandemic has also had a stark effect on the types of products retailers are looking to purchase.
For many consumers, lockdowns have heightened their appreciation of affordable luxuries – small treats that offer an everyday boost.
Premium main meals have enjoyed a growth in sales as a result.
With 78% of pet owners reporting that the quality of the food they give their animals is as important as what they eat themselves (Kantar), it is little wonder.
“The emotional benefits of treating our pets to their favourite foods has ensured this popularity has endured, and there’s historical evidence to support the argument that premium petcare will continue to be in demand for convenience retailers for the foreseeable; after the financial crash of 2008, for example, sales of many categories experienced what has been termed the ‘lipstick effect’ – growing demand for affordable luxuries that help raise the spirits during times of hardship,” adds Smith.
Premiumisation has long been a key driver of petcare sales, but the last 12 months has seen the trend grow its popularity even further.
More of us than ever before are seeing our pets as members of the family, with 72% of shoppers stating that they would be unwilling to compromise on the quality of products being bought for their pet.
That’s only 4% more than would compromise on products for their human children.
With such strong sentiment, it’s no wonder that premium offerings are continuing to drive petcare sales for retailers.
This is particularly true for the convenience channel, where premium cat meals added +14% year on year growth in 2020 (Nielsen).
“These changes present a great opportunity for wholesalers, who can cater to retailers who are seeking out premium products,” says Smith. “By stocking premium meals, wholesalers can also encourage those new to the category to trade up on their usual purchases. The continued growth of premium products shows the enduring popularity of luxury, and the growing importance for convenience retailers to cater to this demand.”
A growing market even prior to the pandemic, natural claims have become the number one motivator for human food choices, growing 6% in recent years (Euromonitor).
Anything artificial is eyed with suspicion, and when it comes to ingredients, less is more; 52% of consumers agree that a product is healthier if it contains fewer of them (Mintel).
This trend is having a huge influence on pet nutrition, and pet food products carrying claims relating to nature-inspired diets currently account for 12% of the market, having achieved 14.8% growth in the latest 12 months (Mintel).
Both natural and health appeal cuts across categories, with healthy treat options proving just as enticing to retailers.
This presents a real opportunity for wholesalers, with both food and treating options easily slotting into wider petcare ranges.
Indeed, natural treats and dry dog foods from brands such as Pedigree have experienced a +4% uplift in sales over the last 12 months (Nielsen).
Mars Petcare also forecasts compound annual growth of 8% between now and 2024 for natural products, delivering £166m in incremental sales and a 16% slice of the category.
With such easy inclusion and much-loved brands to offer retailers, adding products that cater to natural trends provides wholesalers with a great opportunity for future growth.
Today, few people who keep animals see themselves merely as pet owners. 72% of UK shoppers refer to themselves as their pets’ ‘mummy’ or ‘daddy (Mars), affecting not only what they spend their money on in store but how they spend it.
On average, households that have pets spend 26% more on groceries.
Even if you take pet food and litter out of the equation, average spend is still 15% higher (Nielsen).
“Retailers therefore know that there are higher levels of affluence among pet owners, and if they can attract pet parents through their doors, they can expect to realise larger basket spend,” continues Smith. “This presents a clear sales opportunity for wholesalers, who can offer a broader range of petcare offerings. To maximise the benefit of humanisation to retailers, wholesalers should consider accommodating products that cover a breadth of trends. Over 51% of UK shoppers now say they would sooner reduce the amount of money they spend on themselves than on their pets, so offering a variety of premium and healthy meals encourages retailers to trade up and extend their spend.”
2020 has left a significant mark on consumers’ preferences and habits. Whilst COVID has piqued interest in premium products, it has also forced many to budget carefully as financial uncertainty looms.
Against this backdrop, and appealing to over half of shoppers who say they like the format (IGD), Mars Petcare is helping cater to shoppers of all budgets with the launch of three price-marked packs (PMPs). Available now, bestsellers from Pedigree, Sheba and Cesar will carry RRPs of £3.75 – £4.75.
With 55% of pet owners previously stating that they fail to purchase in the convenience channel due to lack of choice, the addition of these new PMPs across well-known brands will help wholesalers to offer stores of all sizes affordable choice.
The Pedigree Pouches 12-pack will carry a £3.75 RRP price-mark. The number one wet single serve brand, Pedigree’s pouch format is growing +33% (Nielsen), making this new PMP addition a must-stock for wholesalers.
In addition, retailers looking for premium options will also be catered for. Cesar Trays 8-pack and Sheba Pouches 12-pack both carry a £4.75 RRP price-mark, and with Cesar Trays growing at +8% and Sheba Pouches at +14%, these premium options are ideal, affordable luxury for retailers wanting to cater towards the emerging premiumisation trend. The new PMPs will be supported with merchandising advice and planograms from Mars Petcare.
Dan Mackenzie, Sales Director of All About Pet Health, distributor of Overby Farm and Animal Essentials in the UK, comments: “Lockdown pet is a trend. Pets are stressed in lockdown and we saw an increase in sales of our Quiet Moments calming range from Overby Farm (soft chews and sprays). Digestion is very popular right now, we believe perhaps due to owners being at home more often and feeding scraps or opportunist dogs that find unmonitored food more readily. Our Digestion products saw an upsurge in sales.”
All About Pet Health is working on a range of senior health products, including advanced joint care, gum and tooth care, heart health and a few others.
Digestive and calming products are very popular right now. Figures suggest over 1 million new pet owners exist since the first lockdown.
All About Pet Health offers a selection of flyers and leaflets to support wholesalers.
Mackenzie suggests wholesalers learn about All About Pet Health’s products and what they do to install trust in the transaction, while making sure products are well placed in depot.
All About Pet Health offers competitive pricing and an ‘own brand’ option for wholesalers to grow their own brand portfolios. Owning your own branded products has more value than selling known brands, Mackenzie believes.
“As pet ownership has increased, so has demand for pet health products,” adds Mackenzie. “As people spend more time at home, they are more likely than ever to spot illness, discomfort, changes of behaviour in their pets and then do something about it. Owners are also worried taking their pets to the vet (we would always advise taking pets to the vet if problems persist).”
Jordan Coombe, co-founder of Natural Cornish Pet, comments: “There is certainly an even bigger emphasis than ever before on the locality of pet products and their effects on the environment.”
Since the launch of its wholesale site in July, Natural Cornish Pet has seen a big demand for its Cornish products, particularly its natural fish treat pouches and natural Cornish peanut butter.
Last year alone Natural Cornish Pet launched 6 new lines, including the very popular Natural Cornish Antlers and Yak Chews.
“Having very recently entered into the wholesale market to offer our own brand of Natural Cornish Pet products to other dog-friendly businesses in the UK, we have been very pleased with the reception we have received,” adds Coombe. “From dog groomers to farm shops, our customer base has grown to reach a wide variety of dog-friendly ventures country wide, and we hope to expand this further in 2021!”
Since setting up the Natural Cornish Pet shop a few years ago, the company has been an avid user of social media, particularly Instagram. The visuals of the store, products and brand are something that the company is very proud of and so lets the products do the talking when it comes to marketing.
“Utilising social media and engaging with consumers is a great way to maximise sales and illustrate the benefits of the products being sold,” says Coombe.
Natural Cornish Pet has set up a dedicated trade website to provide wholesalers with a streamlined ordering process and access to imagery for marketing purposes.
“It’s very important to us that anyone we work with understands the benefits of our products and is armed with the knowledge to provide to their own customers, ensuring that their four-legged friends receive the right products for them,” Coombe continues.
“The pet industry seems to be continuing to grow despite the devastating effects of the pandemic,” adds Coombe. “For many, our pets have helped us to get through some of the difficulties of the past year and we have found that this has only put more of an emphasis on the importance of investing in our four-legged friends and ensuring that they live healthy and happy lives.”