China’s pet market is booming. The number of pet cats and dogs in China inched towards 100 million last year. Pet-related products are also one of the fastest-growing categories on China’s cross-border e-commerce platforms. We previously published another blog post about how e-commerce is fueling this market. But today we look further ahead.
So, what’s next for China’s pet food and pet accessories market?
We sat down with AgencyChina’s Research & Strategy Manager, Michael Norris, who relayed what he and his team of Chinese market research professionals had found on a few recent projects.
Below is an edited transcript. If you like what you hear, you can sign up to arrange a free expert call with Michael Norris, now available till December 31. A unique chance to get some great first hand China knowledge!
Question 1
Editor: Recently, we’ve seen data out of China’s e-commerce platforms about strong growth in pet food. What’s driving increased pet food spend?
Michael Norris: Obviously you’ve got a lot of new pet owners coming into the category each year, which underpins some of these gains.
There’s also category premiumization, with pet owners looking for better products for their furry family members. Orijen’s explosive growth in China is a great example of premiumization cues – award-winning cat food for different life stages. This is the type of premium proposition that can excel in-market.
Finally, and I don’t think it’s talked about quite enough, is the number of two-pet families is growing at a rapid clip. That means you’ve got pet owners increasing the size of their shopping basket online, ordering double what they did previously and maybe doing some pantry stocking during e-commerce promotions.
Question 2
Editor: Apart from pet food, what else is really hot right now in pet-related categories?
Michael Norris: There’s two things our team in China is looking at right now. The first is pet nutraceuticals – vitamins and supplements for dogs and cats. This sub-category is rich with opportunity – joint care, dental care, general wellness, temperament, skin and nails. Because pets are such an extension of the owner’s identity here, you see a lot of mimicry. So, imagine you’ve got a cat owner who’s recently had her teeth whitened. Not too long after her own dental treatment, she’ll start to focus on her cat’s oral care. There are a few cheeky marketing tactics that could be deployed here.
The second is pet tech – automatic feeders, self-cleaning litter boxes, automated ball dispensers and other gizmos like that. One of the interesting things you observe once you’ve been to a number of pet owners’ homes is the incredible interest in gadgetry. Part of that is due to the relative youth of pet owners here – half are under 30 and lead digital-first lives. Accordingly, I have high confidence in products that alleviate timeless pet owner headaches with technology will be a massive hit in-market.
Question 3
Editor: What is something about China’s pet market that people find surprising?
Michael Norris: I think what many folks don’t realize is that pet insurance is just getting started in China.
There are few pet insurance products, and we estimate 98% of pet owners pay medical bills fully out-of-pocket.
Once you have greater levels of pet insurance coverage in China, medical expenses as a proportion of pet care spend will come down, and will be reinvested in more treats, more pet-related services, more nutraceuticals, and more toys. That’s an incredible unlock for the category.
Question 4
Editor: What does AgencyChina do to help brands access China’s pet market?
Michael Norris: AgencyChina is a full-service agency, covering market research, marketing and e-commerce operations. That means we’re in a great place to help new and established brands at any point in their journey.
We can help size up an opportunity and build a business case, use consumer interviews to understand changing needs, create a distinctive brand in-market, or identify which parts of a brand’s e-commerce operations need some fine-tuning.
I always encourage folks to have an open dialogue with us. Let us know where you’re at, and we can see whether we’re a good fit.
Free consult with Michael until December 31st!
And don’t forget, you can book a free consult with Michael until December 31st, Book your time now to talk with Michael and get your China adventure started!
