China’s pet food business has expanded rapidly over the last five years, achieving 25 percent growth per year from 2016 to 2021, according to a new report.
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And, demand for premium pet food has tracked the rise.
Chinese consumers view their furry friends as family members who deserve the best to eat, according to a white paper by Alibaba Group and C2 Capital Partners, a private equity firm, drawing on data from consultancy Bain & Co.
“This shift in attitudes has fueled demand for premium commercial pet food that promotes pet health and wellbeing,” wrote the report’s authors, including Chen Tan, who oversees the pet category at Alibaba’s cross-border marketplace Tmall Global.
Premium pet food, defined as products costing over USD 7 per kg, outpaced the animal food category as a whole during 11.11, the world’s largest retail event last year.
Top-quality imported brands saw 40 percent growth during the 11.11 shopping festival, higher than the 25 percent growth across the broader category, according to Alibaba’s B2C marketplace Tmall.
The Chinese pet market has yet to see a brand valued above CNY 10 billion (USD 1.4 billion), with only a few brands reaching the CNY 1 billion mark, analysis from consultancy Bain & Co. shows.
But it is only a matter of time, given the sector’s strong growth in recent years. The value of China’s pet food market tripled between 2016 and 2021, per Bain insights, with an even split between dog and cat-related products.
“This rapid growth highlights pet food as a bright spot among the Chinese consumer products industry,” Alibaba and C2’s white paper said.
China is now the second-largest market for pet food in the world after the United States, despite having roughly half its pet ownership rate, Alibaba reported based on data from Bain.
Rapid growth across China’s pet food market is driven by increased pet ownership among young people, women and high-income groups living in first and second-tier cities, according to the white paper.
Around 45 percent of new pet owners in China were born in the 1990s, and nearly 60 percent are female, according to Bain.
“For this group of [young] consumers, pets are playing an important emotional role as extended family members,” the report noted.
These predominantly young women view their animals with strong emotional attachment and dote on them, driving average per-pet spending on pet food up 15 percent annually over the last six years, Alibaba and C2 reported in the white paper.
“I’m very particular on the kind of meat used, and where the product is produced, when it comes to feeding my dog,” said 33-year-old Siutan Wong, who at one point regularly flew to the United States to pack her bags full with food for her miniature Schnauzer.
Nowadays, premium imported pet food is just a click away rather than a flight.
More varied choice is a boon for China’s latest generation of pet owners, most of whom live in middle-class households with monthly incomes between CNY 4,000 and CNY 20,000, according to the white paper.
Only The Best
Consumers of premium pet food look for products made of fresh, natural ingredients with minimal processing and no added chemicals.
“I always check carefully for the beneficial ingredients,” said Zheng Yuanmei, who calls her two Shiba Inus her children.
The dizzying array of premium imported pet food on sale during last year’s 11.11, also known as Double 11, left the 30-year-old dog mum feeling like she had just been beauty product shopping – with all the jargon and scientific-sounding ingredient names to match.
Tmall global consumers can browse from more than 2,000 unique products in the pet food category, up from just 138 in 2016, according to the white paper.
Shoppers like Zheng are expanding their repertoire to include raw and freeze-dried food that claims to have higher nutritional value than cooked alternatives. To be sure, vets advise a balanced diet with, in some cases with premium vitamin and supplement regimes to fill in the gaps.
The higher price point of top-quality imported pet food, which can carry a 50 percent premium, has not slackened appetites.
“There may be even stronger demand for global pet food brands in the years ahead,” said Chen.