The pet care market offers moderate but stable growth prospects, helped by a constant rise in pet ownership and increase in spending per pet.
Currently estimated to be worth over $190bn, researchers expect the global market to grow by an average of close to 5% per year between 2019 and 2025.
The main drivers of this growth are the rise in pet ownership and a consistent increase in spending per pet.
The market also features a relatively resilient profile. In the US, for example, pet care spending continued to grow even during the 2008 Global Financial Crisis (GFC).
The sector encompasses strong, defensive brands and, despite some recent mergers and acquisitions, remains relatively fragmented. Further consolidation is likely.
The US is by far the largest pet care market globally, with an estimated $95.7bn spent in 2019, up 5.7% from 2018.
Industry experts estimate that pet-related spending will increase by another 3.5% in 2020 and reach $99bn by the end of the year.
In recent years, the rapid increase in pet care spending in large developed markets, such as the US, the UK, Germany and France, has also been accompanied a surge in demand from newer markets, particularly in Asia.
The pet population of South Korea, for instance, grew from 4.9 million in 2014 to 7.5 million in 2018, which is a compound annual rate of 10.8%.
Meanwhile, the number of cat and dog owners in China is estimated to have risen by 8.4% from 2018 to 2019, reaching 61.2 million.
While this may look like a large number, it is still only a tiny fraction of the country's overall population.
In many countries, millennials are increasingly seeing pets as a genuine alternative to children. In the US they represent the largest demographic group of pet owners for all pet types.
Finally, another interesting recent development has been the emergence of new types of offerings, in particular from the online retail sector. Subscription deals for regular food shipments and birthday gift boxes are a case in point.
These have given an additional boost to the rise of e-commerce in the pet care segment.
Jack Neele & Richard Speetjens are portfolio managers at Robeco Global Consumer Trends
• The pet care market is often resilient during crises, having continued to grow during the 2008 GFC
• There has been a recent surge in demand from emerging markets such as Asia, which have plenty of scope for growth in this sector
• Containment measures have forced many veterinary practices to remain closed
• The close of adoption centres in some countries could slow the rise in pet ownership