Petflation 2023 – February Update: Price increase grows to +10.9% vs 2022

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Inflation continues to make headlines. The YOY increases in the monthly Consumer Price Index (CPI) are larger than we have seen in decades but are slowing a little. February prices grew 0.6% from January and the CPI was still up +6.0% vs 2022, but down from +6.4% last month. The grocery price surge also slowed but they’re still up 10.2% over 2022. That’s 12 straight months of double-digit YOY monthly percentage increases. These are the first 10+% increases since 1981. As we have seen in recent years, even minor price changes can affect consumer pet spending, especially in the discretionary pet segments, so we will continue to publish monthly reports to track petflation as it evolves in the market.

Total Pet prices were 4.1% higher in December 2021 than in December 2020, while the overall CPI was up 7.0%. The gap narrowed as Petflation accelerated and reached 96.7% of the national rate in June 2022. National inflation has slowed since July, but Petflation has generally increased. It passed the National CPI in July and is +10.9% in February, 81.7% higher than the national rate of 6.0%. We will look deeper into the numbers. This and future reports will include:

  • A rolling 24 month tracking of the CPI for all pet segments and the national CPI. The base number will be pre-pandemic December 2019 in this and future reports, which will facilitate comparisons.
  • Monthly comparisons of 23 vs 22 which will include Pet Segments and relevant Human spending categories. Plus
    1. CPI change from the previous month.
    2. Inflation changes for recent years (22>21, 20>21, 19>20, 18>19)
    3. Total Inflation for the current month in 2023 vs 2019 and now vs 2021 to see the full inflation surge.
    4. Average annual Year Over Year inflation rate from 2019 to 2023
  • YTD comparisons
    1. YTD numbers for the monthly comparisons #2>4 above

In our first graph we will track the monthly change in prices for the 24 months from February 2021 to February 2023. We will use December 2019 as a base number so we can track the progress from pre-pandemic times through an eventual recovery. Inflation is a complex issue. This chart is designed to give you a visual image of the flow of pricing. You can see the similarities and differences in patterns between segments and compare them to the overall U.S. CPI. The current numbers plus yearend and those from 12 and 24 months earlier are included. This will give you some key waypoints. In February Supplies passed their old November pricing high so all segments are now at their cumulative inflation peak.

The pandemic hit home in 2020. In February 21, the national CPI was only +2.4% and Pet prices were +1.4%. Veterinary and Services prices generally inflated after mid-2020, similar to the overall CPI while Food and Supplies prices generally deflated until late 2021. After that time, Petflation took off. Pet Food prices consistently increased but the other segments had mixed patterns until July 2022, when all increased. In Aug>Oct Petflation accelerated, except for a small October dip in Veterinary. In Nov>Dec, Services & Food prices continued to grow while Veterinary & Supplies prices stabilized. In Jan>Feb, all inflated and Total Petflation since Dec 2019 has been above the U.S. CPI since November.

  • U.S. CPI – The inflation rate was below 2% through 2020. It turned up in January 2021 and continued to grow until flattening out in Jul>Dec 2022. Prices turned up again in Jan>Feb but 40% of the overall 18.6% increase since 2019 happened from January>June 2022.
  • Pet Food – Prices stayed generally below Dec 2019 levels from Apr 2020 > Sept 2021, when they turned up. There was a sharp lift in Dec 2021, and it has continued. 91% of the 18.6% increase occurred since 2022.
  • Pet Supplies – Supplies prices were high in December 2019 due to the added tariffs. They then had a “deflated” roller coaster ride until mid-2021 when they returned to December 2019 prices and essentially stayed there until 2022. They turned up in January and hit an all-time high, beating the 2009 record. They plateaued from Feb> May, turned up in June, flattened in July, then turned up in Aug>Oct to a new record high. Prices stabilized in Nov>Dec but turned up again in January and reached a new record high in February.
  • Pet Services – Normally inflation is 2+%. Perhaps due to closures, prices increased at a lower rate in 2020. In 2021 consumer demand increased but there were fewer outlets. Inflation grew in 2021 with the biggest lift in Jan>Apr. Inflation was stronger in 2022 but it got on a rollercoaster in Mar>June. It has turned up again July>Feb but again fell behind Food so it is in 3rd place among Pet Industry Segments.
  • Veterinary – Inflation has been pretty consistent in Veterinary. Prices turned up in March 2020 and grew through 2021. A pricing surge began in December 2021 which put them above the overall CPI. In May 2022 prices fell and stabilized in June causing them to briefly fall below the National CPI. However, prices turned up again and despite Oct & Dec dips they have stayed above the National CPI since July and set new records in January & February.
  • Total Pet – The blending of patterns made Total Pet appear calm. In December 2021 the pricing surge began. In Mar>June 2022 the segments had ups & downs but Petflation grew again from Jul>Nov. It slowed in December then turned up again in January and February as all segments increased prices. It has been ahead of the cumulative U.S. CPI on our 2019>2023 chart since November.

Next, we’ll turn our attention to the Year over Year inflation rate change for February and compare it to last month, last year and to previous years. We also added a new measurement, showing the total inflation from 2021 to 2023. Although national inflation is slowing, it’s not for Pet. This will allow you to see the cumulative amount of the current pricing surge. You can compare the inflation rates of 22>23 to 21>22 but also see how much of the total inflation since 2019 came from the ongoing trauma. Again, we’ve included some human categories to put the pet numbers into perspective.

Overall, Prices were +0.6% vs January and were up 6.0% vs February 2022. The Grocery increase is down to 10.2% but is still a big negative. Prices often rise early in the year so it’s not surprising that 8 of 9 categories had increased prices from last month. 7 of the increases were 0.5+%. Last month there were 5 but only 1 in December. 3 of the increases were over 1.0%, all from the Pet Industry – Total Pet: 1.5%; Pet Food: 1.2%; Veterinary: an incredible 2.5%. The overall national YOY monthly inflation rate is slightly down from January, but it is significantly down vs the 21>22 rate. 3 categories – Pet Supplies, Medical Services & Haircuts have a similar pattern. In all other categories the 22>23 inflation rate is higher than the 21>22 rate and is in fact the highest rate in any year since 2019. In our new 21>23 measurement you also can see that over 70% of the cumulative inflation since 2019 occurred in the current surge for all categories but Veterinary, Medical Services and Haircuts & Personal Services. The Pet Supplies Segment has a unique situation. The 21>23 inflation surge provided 116% of the overall inflation since 2019. This happened because Pet Supplies prices strongly deflated in 20>21.

  • U.S. CPI– Prices are +0.6% from January. The YOY increase is down to +6.0%. It peaked at +9.1% back in June. The targeted inflation rate is <2% so we are still over 3 times higher than the target. However, an 8th straight slight decline is good news. It is also good that the current inflation rate is below 21>22 but the 21>23 rate is 14.4%, 76% of total inflation since 2019. How many households “broke even” by increasing their income by over 14% in 2 years?
  • Pet Food– Prices are +1.2% vs January and 15.2% vs February 2022. They are also 49% higher than the Food at Home inflation rate – not good news! The YOY increase is being measured against a time when prices were only 3.0% above the 2019 level, but that increase is still an incredible 8.9 times the pre-pandemic 1.7% increase from 2018 to 2019. The 2021>2023 inflation surge generated 91% of the total 21.3% inflation since 2019.
  • Food at Home – Prices are up 0.3% from January. The monthly YOY increase is 10.2%, down slightly from 11.3% in January but considerably lower than Jul>Sep 2022 when it exceeded 13%. The 25.0% Inflation for this category since 2019 is 32% more than the national CPI but now 2nd to Veterinary. 79% of the inflation since 2019 occurred from 2021>2023 but the pattern is different from the national CPI. Grocery prices began inflating in 2020>2021 then the rate accelerated. It appears that the pandemic supply chain issues in Food which contributed to higher prices started early and foreshadowed problems in other categories and the overall CPI tsunami.
  • Pets & Supplies – Prices are up +0.5% from January. That’s 3 straight monthly increases after a dip in November. They still have the lowest increase since 2019 and now have fallen to last place in terms of the monthly increase vs last year for Pet Segments. As we noted earlier, prices deflated in 2020>2021 so the 2021>2023 inflation surge accounted for 100+% of the total price increase since 2019. They reached an all-time high in October then prices deflated. However, 3 straight months of increases has pushed them to a new record high in February.
  • Veterinary Services – Prices are +2.5% from January. They are +10.3% from 2022 and are in 2nd place behind Food in the Pet Industry. However, they are now the leader in the increase since 2019 with 26.4% compared to Food at home at 25.0%. For Veterinary Services, relatively high annual inflation is the norm. The rate did increase during the current surge but only 61% of the 4 years’ worth of inflation occurred in the 2 years from 2021>2023.
  • Medical Services – Prices turned sharply up at the start of the pandemic but then inflation slowed and fell to a low rate in 20>21. In February prices fell -0.5% from January and were +2.1% vs 2022, the lowest rate since 2019. Medical Services are not a big part of the current surge as only 34% of the 2019>23 increase happened from 21>23.
  • Pet Services – Inflation slowed in 2020 but began to grow in 2021/2022. February 23 prices were up +0.5% from January and +7.5% vs 2022. The rate has slowed but prices still reached a new all-time high. Their inflation is tied to the current surge as 73% of total since 2019 occurred from 2021>2023.
  • Haircuts & Other Personal Services – Prices are +0.6% from January and +4.8% from 2022, but this is only the 3rd highest rate since 2019. Inflation began to grow in 20>21 and just 51% of the inflation from 19>23 happened from 21>23.
  • Total Pet– Petflation is double the rate of last year, 81.7% ahead of the National CPI and the +10.9% is also the highest February rate in history. Prices increased in all segments vs January so Total Pet was up 0.5%, which was expected. A Jan>Feb increase in Petflation has happened in 25 of the last 26 years. Food is the runaway leader, but the 22>23 inflation rate for all but Supplies exceeds the 21>22 rate. Pet Food has generally been immune as Pet Parents are used to paying a lot. However, inflation can cause reduced purchase frequency in the other Segments.

Now, let’s look at the YTD numbers.

The increase from 2022 to 2023 is the biggest for 5 of 9 categories. The 22>23 rate for 3 categories is essentially tied with 21>22. Only the Total CPI is significantly down from 21>22. The average annual increase since 2019 is 4.4% or more for all but Medical Services (3.3%) and Pet Supplies (2.7%).

  • U.S. CPI – The current increase is down 19.5% from 21>22 but is still 41% more than the average increase from 2019>2023, and more than 3 times the average annual increase from 2018>2021. 76% of the 18.9% inflation since 2019 occurred from 2021>23. Inflation is a big problem that started recently.
  • Pet Food – Inflation continues to grow stronger. Deflation in the 1st half of 2021 kept YTD prices low then prices surged in 2022. 89.5% of the inflation since 2019 occurred from 2021>23.
  • Food at Home – The 2023 YTD inflation rate has slowed slightly but still beat the U.S. CPI by 74%. You can see the impact of supply chain issues on the Grocery category as 79% of the inflation since 2019 occurred from 2021>23.
  • Pets & Pet Supplies – While the inflation rate has stabilized at about 6.2%, prices reached a record high in February. Prices deflated significantly in 2021 which helped to create a very unique situation. Prices are up 11.3% from 2019 but 114% of this increase happened from 2021>23. Prices are up 12.9% from their 2021 “bottom”.
  • Veterinary Services – Passed Food at Home for the top spot in inflation since 2019. They are the only segments on the chart with a 5+% average annual inflation rate since 2019. However, Veterinary is unique. They are the only category in which the inflation rate grew steadily every year until 2023 when it has almost doubled. Throughout the pandemic and recovery, no matter what, just charge more.
  • Medical Services – Prices went up significantly at the beginning of the pandemic, but inflation slowed in 2021. In 2022>23 inflation has stabilized at a rate only 8% higher than the pre-pandemic 2018>19 rate.
  • Pet Services – May 22 set a record for the biggest year over year monthly increase in history. Prices fell in June but began to grow again in July, reaching record highs in Sep>Feb. The January increase of 8.4% was the largest in history. YTD February is down slightly to 8.0%. Growing demand with decreased availability is a formula for inflation.
  • Haircuts & Personal Services – The services segments, essential & non-essential were hit hardest by the pandemic. After a small decrease in March 22, prices turned up again. The YTD rate is 11% below the 2020>21 peak but is 51% more than 2018>19. Consumers are paying 20% more than in 2019. This usually reduces the purchase frequency.
  • Total Pet – We have seen basically two different inflation patterns. After 2019, Prices in the Services segments continued to increase, and the rate accelerated as we moved into 2021. The product segments – Food and Supplies, were on a different path. They generally deflated in 2020 and didn’t return to 2019 levels until mid-year 2021. Food prices began a slow increase, but Supplies remained stable until near yearend. In 2022, Food and Supplies prices turned sharply up. Food prices have continued to climb. Supplies prices stabilized Apr>May, grew Jun>Oct, fell in Nov, then rose again Dec>Feb. The Services segments have had ups & downs but are generally inflating. The net is a YTD Petflation rate vs 2022 of 10.8%, 74.2% more than the National rate. In March 22 it was only 72.5% of the CPI.

Petflation is growing stronger. Let’s put the numbers into perspective. The 10.9% February 2023 increase in Total Petflation is below the record 12.0% set in November, but it is still a record for the month. We’ve also now had 7 consecutive months over 10%. The last time that petflation exceeded 10% was 10.3% in 2009. The current rate is more than 7 times the 1.5% average rate from 2010>2021. There is no doubt that the current pricing tsunami is a significant event in the history of the Pet Industry but will it affect Pet Parents’ spending. In our demographic analysis of the annual Consumer Expenditure Survey which is conducted by the US BLS with help from personnel from the Census Bureau we have seen that Pet spending continues to move to higher income groups. However, the impact of inflation varies by segment. Supplies is the most affected as since 2009 many categories have become commoditized which makes them more price sensitive. Super Premium Food has become widespread because the perceived value has grown. Higher prices generally just push people to value shop. Veterinary prices have strongly inflated for years, resulting in a decrease in visit frequency. Spending in the Services segment is driven by higher incomes, so inflation is less impactful. There is another fact that just came out that is relevant to our spending question. The US BLS recently decided to update the CPI annually rather than every 2 years based upon each expenditure’s share of total expenditures. I worked with them to update the CPI of my specially created retail aggregates. During our conversations, they noted that Pet expenditures in 2021 had one of the biggest share gains of any group. Apparently, Pet Parents are reallocating their $ to prioritize their “children’s” needs. This is not unexpected. We’ll see if this behavior is impacted by continued high inflation.

Comparing the Spending Demographics of the Pet Industry Segments – SIDE BY SIDE

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The first 5 reports of our Pet Spending Demographics analysis have been very detailed and intense. We looked at the industry as a whole and each of the individual segments. Recent years have seen some turmoil. We have seen the very real impact of outside influences on the industry. In the 2nd half of 2018, the FDA warning on grain free dog food caused a $2.3B drop in Food $ and new Tariffs flattened Supplies $, but Services had a record lift. In 2019, Food rebounded but the tariffs really hit the Supplies segment with a $3B drop. Veterinary $ grew slightly while Services $ fell a bit. The net was -0.2% drop in Total Pet. The 2020 pandemic had varied impacts as Pet Parents focused on needs. This caused a lift in Veterinary and a huge increase in Food because some demographics binge bought out of fear of shortages. Services spending plummeted due to outlet closures and restrictions while Supplies $ continued to fall because consumers saw them as more discretionary. 2021 brought a big change, Food $ fell because there was no “binge” repeat. However, Pet Parents focused on their “children” producing a widespread record lift in all other segments and a record $16B increase.

We have often referenced the similarities and differences in spending between Total Pet and the individual industry segments. Total Pet Spending is a sum of the parts and not all parts are equal. In this final report we are going to put the segments side by side to make the parallels, differences and changes from 2020 more readily apparent. We will address:

  • “The big spenders” – those groups which account for the bulk of pet spending.
  • The best and worst performing segments in each of twelve demographic categories
  • The segments with the biggest changes in spending $ – both positive and negative
  • And of course, the “Ultimate Spending CUs”

The emphasis is on “visual” side by side comparisons to allow you to quickly compare the industry segments. We’ll try to minimalize our comments. You can always reference one of the specific reports for more details. We’ll also break the charts up into smaller pieces that are demographically related to make the comparison more focused and easier.

Before we get started, let’s take a look at the current market share of the industry segments. The following 2 charts show the 2021 share of spending for each segment and the evolution over the past 29 years. 1992 was the last year that the Food Segment accounted for 50% of Total Pet Spending. By the way, Total Pet Spending was $16.2B in 1992. We have come a long way – +517%; annual growth rate of 6.48%. This will help put our comparisons into better perspective.

                                                                  Food: 34.4%; Down from 44.0%                Veterinary: 32.7%; Up from 29.7%

                                                               Supplies: 23.8%; Up from 18.1%                Services: 9.1%; Up from 8.2%

In 2021, Food lost almost 10% of share in Total Pet $ which was gained by all other segments. The most notable trend from 1992 to 2012 was the decline in Food share while Supplies gained in importance. In the 90’s Pet Owners became Pet Parents. At the same time, Pet Chains and Super Stores came to the forefront and there was a big Pet Product expansion into the Mass Market. In recent years, the Product Segments have been on a rollercoaster. Food reached 44% in 2020, the highest level since 44.8% in 1998. Supplies have been trending down since 2012, hitting bottom at 18.1% in 2020. The Services segments have been more stable. They have generally trended up since 2012. Non-Vet Services peaked at 11+% in 2018>19 then fell to 8.2% in 2020. They turned sharply up in 2021. Veterinary has been in the 25>27% range since 2012 but with a big lift in 2021, they broke the 30% mark and now trail Food by only 1.7%. Big Trends in Food and Petflation in Supplies tend to make the Product Segments more volatile than the Services Segments.

Now let’s get started with a look at the “Big Spenders”. The following 2 charts will compare the market share and performance in all Pet Industry segments by the groups responsible for the bulk of the spending in 10 demographic categories. These are the groups that we identified in our Total Pet analysis to generate at least a 60% market share of spending. As you recall, to better target the spending we altered 2 groups in Services and 1 in Food. However, to have a true side by side comparison we need to use the same groups for all. The market share dips below 60% twice, both in Food spending. One is because Food spending by Age is more balanced but skewed a little older than other segments. The other is in # of Earners, where the number of Earners in a CU mattered less. Even the low point of 55.1% is within 5% of our target and 96% of all measurements meet or exceed the 60% requirement, so the comparison is very valid.

The chart makes it especially easy to compare performance across categories. Remember, performance levels above 120% show a very high level of importance for this category in terms of increased spending. Unfortunately, it also indicates a high spending disparity among the segments within the category. There are 2 charts, each with 5 categories.

  • White, Non-Hispanic – This group has an 83+% market share in every Segment. Minorities account for 32.8% of CUs but only 15>17% of spending in any segment. Factors: Lower income for Hispanics and African Americans and lower Pet ownership in Asians and African Americans. Whites lost 2>4% in share in all segments but Supplies which fell 0.1%. Hispanics made the biggest gains. Asians also had increases but African Americans generally lost ground.
  • 2+ People in CU – 2+ is still the key in pet ownership. However, the results were mixed by size. Singles lost ground in all but Food so 2+ CUs had the opposite pattern. 2 People had big gains in all but Supplies. 3 People had big drops in all but Food. 4 People gained in Supplies and Veterinary but fell in Services and plummeted -18.7% in Food which produced the biggest drop in Total Pet. 5 People were up in all but Food. Truly, a mixed bag by CU size.
  • Homeowners – Homeownership is very important in Pet Ownership and subsequently in all Pet Spending. It also increases with age. This group’s share of Total Pet fell below 80% for the first time in 2018. It bounced back in 2019>20 but fell 3 points in 2021. All but Services lost share with Food having the biggest drop, -5.7%. Services gained 2% and is again above 80%. Supplies remains at the bottom. Those w/o Mtge drove the big decrease.
  • Suburban & Rural – They gained 0.2% in Total Pet. Both the Suburbs 2500> and Areas <2500 had strong gains in Veterinary but the other segments were divided. The Big Suburbs had strong gains in Food, Supplies & Total but lost ground in Services. The less populated areas increased share of Services but their share fell in Food, Supplies & Total.
  • Over $70K Income – INCOME MATTERS MOST IN PET SPENDING! Income has grown in importance in recent years and all Industry segments performed at 140+%. Food lost 2% in share and replaced Supplies at the bottom in share and performance. It was the only segment with decreased share and performance. The other segments gained at least 5.6% in share, led by an 8.3% gain by Veterinary. Food spending became slightly more balanced while the income spending disparity gap significantly widened for the other segments. Services is still the least balanced.

  • Everyone Works – Income is important, and the importance of # of Earners grew for the discretionary segments, Supplies & Services. Veterinary held its ground but Food performance fell 22%, driving Total Pet below 120%. The drop in Food was due to no binge buying while the big discretionary lifts came from the record pandemic recovery.
  • College Grads – Higher education often correlates with higher income and a College degree is 2nd in spending importance for all but Food. The group grew in share and performance in all segments, but Veterinary. Veterinary lost 4.1% in share and 6.9% in performance while the product segments, led by Food, gained 18.4% in share and 37.2% in performance. Total Pet gained 13.0% in share and 26.0% in performance. College is now a key factor.
  • All Wage & Salary Earners– Incomes vary widely in this group, so performance is often lower. Supplies fell sharply in share and performance. Veterinary lost share due to fewer CUs but gained in performance. Services had slight gains in both. Food gained 12% in share and 22% in performance which pushed performance again above 100% – also for Total Pet. The group spent more in all segments, including Food but the bulk of the lifts came from White Collar.
  • Married Couples – Marriage has been important to spending in all segments. In 2021 all segments but Food & Total Pet gained in share and performance. The lift was widespread in Married segments with 1 big negative exception, Married Couples with an oldest child 18 or older.
  • 35 to 64 yrs – Includes the 3 highest income segments. This group had the same pattern of gains/losses as CU Composition – Food & Total down, all other segments up. The “bad guys” were 55>64 yr-olds. However, Food is a little more balanced by Age and in fact skews a little older. 35>64 only has a 55% share of the $.

Now we’ll drill a little deeper to look at the Best and Worst performing segments in each category. Color Highlighted cells are different from Total Pet; * = New Winner/Loser; ↑↓ = 5+% Performance Change from 2020. We will divide the categories into related groups. First, those related to Income.

  • Income – Income matters, and its importance is growing in the Industry. The Food winner was up $150>199K from $100>149K in 2020 but the disparity between first and last place fell by 80%. The disparity in Services and Veterinary was 40+% more but Supplies was up 100+%. This pushed Total Pet up +50%. Income Matters the Most.
  • # Earners – More earners = more income. 2+ Earners is the usual winner and reflects the importance of Gen X and Millennial CUs. The turmoil in Food is reflected by the No Earner, 2+ CU win. In all segments but Food & Total Pet the disparity and importance of the number of Earners grew. The biggest gain occurred in Veterinary.
  • Occupation– Mgrs & Professionals and Self-Employed are #1 and #2 in CU income and expenditures. Self-Employed binge bought food in 2020 so they were replaced by Mgrs/Professionals in 2021. The bottom spots are again occupied by either Retirees or Blue-Collar workers. No Binge in 2021 caused the disparity to drop by 100+% in Food and Total Pet. It also decreased in all but Services. Income is important in Pet Spending but how you earn it is less so.

Next are demographics of which we have no control – Age, Generation and Racial/Ethnicity

  • Racial/Ethnic– As expected, White Non-Hispanics are the top performer in all segments and African Americans replaced Asians in Food so they occupy all the bottom slots. They have the lowest income and only 25% own Pets. The disparity grew sharply in Supplies so now it is basically a 100% performance difference in Total & all segments.
  • Age – The winners are all new. 35>44 had a strong year, but the winners are mixed. At the bottom in all but Supplies are <25 yr-olds. Food and Veterinary spending skew a little older. There are still big disparities in all segments but Food, which has more balanced spending at least by age, as all age groups over 35 have at least 95% performance.
  • Generation – Gen X now rules. Gen Z is at the bottom in all but Supplies, which skews younger. The disparity gap closed significantly in Food but increased by 20% in Services & Supplies. It grew by 4% in Veterinary and Total Pet.

  • Education – Winning and losing is closely tied to more and less Education which generally correlates with income. The disparities are huge. The biggest change is in Food which skewed towards lower education in the 2020 binge.
  • CU Composition – In 2021 Pet Spending was all about CUs with kids, except for Food. The oldest kid 6>17 aligns with the middle age groups. Single Parents remain at the bottom in all but Supplies and the disparities are huge, 100+%.
  • CU Size– The top CU number in Pet is now 4+ but “1” remains solidly on the bottom. 2 people CUs are still important as they replaced 4 people CUs at the top in Food & Services. The disparity is also smaller in all but Supplies.

  • Housing – We’re back to normal as Homeowners w/Mortgage and Renters are the perennial winner and loser.
  • Area– Areas <2500 population performed the best. This is surprising in Services as that usually skews towards higher population. Another surprise is Suburbs 2500> replaced Center City at the bottom in Food with a huge disparity.
  • Region – 3 new winners, but no surprises. The South is again at the bottom in all but Food.

Here are two summary charts. The first compares the averages.

The big changes in Food & Supplies are immediately apparent. The 2021 difference in Food is less than half of 2020 while it increased by 40+% in Supplies. Pre-pandemic, the performance difference grew as you moved from Products to Services, peaking in the most discretionary, Non-Vet Services. In 2021, Food flipped from highest to lowest disparity, while Supplies moved to the top. However, both Veterinary and Supplies now have a difference of 100+%. Spending became significantly less balanced in every segment but Food. While the Total Pet disparity fell, it is still high at 94%.

  • Food – After the 2020 binge, the disparity gap returned to a more normal, pre-pandemic level.
  • Supplies – The record increase produced a record disparity between best and worst.
  • Veterinary – The Winners performance grew while the losers fell pushing the difference over 100%.
  • Services – The performance gap widened but essentially returned to a normal level for this segment.

This chart shows the number of new winners/losers.

Total Pet had many changes, especially in winners. Total Pet is a sum of the segments. However, you see how influential the Pet Food segment is with the turmoil from the drop in 2021 $ after the binge buying by specific segments in 2020.

  • Pet Food spending fell because there was no repeat of the 2020 panic buying. As a result, over 80% of the winners changed and almost half of the losers are new.
  • Even with a record increase, Supplies is the most stable with very little change in top or bottom performers.
  • The Veterinary spending increase was also huge but there was also only a small number of changes.
  • Services had a strong spending recovery and some turmoil mostly on the “losing” side.

Now, let’s look at the Demographic Segments with the Biggest Changes in $. We’ll truly see some differences between the Industry Segments. We have color highlighted differences from Total Pet.  Plus:                                                                                                                                                                                         ↔ = Winner/Loser same as 2020            ↕= Flipped from 1st to Last or vice versa

  • Income – All winners & losers were new with 3 flips from 1st to last. The winners returned to high income groups and the losers to low income, with 2 exceptions. In Food & Total, $100>149K lost due to Food binge buying in 2020.
  • # Earners – All new with 4 flips. In Non-Food Segments, the winner & loser were driven by income. In Food, 2+ CU Retirees finally upgraded which put them on top. They also spent more in other segments which led to a Total win.
  • Occupation – 2 were repeats while 3 flipped. In a pattern similar to # Earners, the Non-Food winners (Managers & Professionals) were high income while the losers were low income. In Food & Total we saw the winning efforts by Retirees as well as the loss for Self-Employed as they didn’t repeat their 2020 extreme Food binge buy in 2021.

Now the Age and Racial/Ethnic Categories

  • Racial Ethnic – White, non-Hispanics won in all but Food, where they were the big loser. They have high income & pet ownership and drove the 2020 Food binge so this is no surprise. African Americans have low income and Pet ownership and lost 3 times (2 were small increases). Asians have high income but had the smallest Services increase.
  • Age – All new with 3 flips. 35>44 had 3 wins while 55>64 won in Veterinary and the 75+ Retirees won in Food. <25 lost in 2 segments and 55>64 paid for their 2020 Food binge, no surprise. 45>54 was an unexpected loser in Services.
  • Generation – Gen X won Food, Supplies & Total and Millennials won Veterinary. Boomers did have the biggest increase in Services but lost in Food & Total Pet. Those born before 1946 came in last in Veterinary and Services. Gen Z did finish last in Supplies, with the smallest increase. However, winning skewed younger while losing skewed older.

Now, here are more Demographic Categories in which the consumers can make choices.

  • Education – Higher education, especially a College degree is tied to increased income and pet spending. We had 4 flips which returned this demographic to a more normal pattern of winners & losers.
  • CU Comp. – While CUs with Children were the best performers in Total Pet and all segments but Food, 2021 was also a strong year for Married Couple Only. They had the biggest increase in Total and all segments but Supplies.
  • CU Size– Bigger CUs performed best, but with 4 last to 1st flips, 2 person CUs had the biggest increases across the board.

  • Housing – 6 flips returned Housing to a more normal pattern with Homeowners w/Mtges at the top. Renters are often at the bottom, but in 2021 those w/o Mtges had 3 losses. Food & Total Pet came from their 2020 Food Binge.
  • Area – The flip winner with 8. Big Suburbs flipped to their normal spot on top in Total and 3 segments. Center City was a surprise winner in Food but the 2020 Binge put <2500 at the bottom in 2021 Food & Total. Center City losses in Supplies & Veterinary are no surprise. The <2500 loss in Services is usual, but a loss with +$0.65B lift is surprising.
  • Region – 6 flips and a more normal pattern with some exceptions. The South is an unusual Food winner and the 2020 Food binge flipped Midwest to the bottom in Food & Total. However, the strangest situation was that losers in 3 categories spent more, 2 with lifts of a $B or more. The big winner was the West and Midwest was the big loser.

The next chart compares the number of repeats, “flips” and new segments among the 12 winners and 12 losers for each industry segment. The idea is to look for patterns in the data that cross segments. Let’s take a look.

  • 3 Segments were up a lot while Food $ fell. The overriding pattern was turmoil.
  • In terms of repeats Supplies (5) and Veterinary (8) led the way while Food and Services had NONE!
  • Due to the 2020 binge, Food led the way in flips (17) with all 2020 winners flipping to last in 2021. Services was 2nd (12). Veterinary had the fewest flips (3) while Supplies had (6) but 5 of the Supplies flips were from last to 1st.
  • You can see how the combined segments put Total Pet in turmoil – 17 flips and only 1 repeat
  • There are a total of 24 winners and losers. The number different from 2020 was: Food: 24; Supplies: 19; Veterinary: 16; Services: 24; Total: 23. It appears that the record recovery caused as much or more turmoil than the pandemic.

Next, there were so many positive contributors that in each individual report we recognized 6 segments that didn’t win but still performed so well that they deserved Honorable Mention. I reviewed that list again and came up with segments that won Honorable Mention at least twice. Here are the 9 “SUPER Honorable Mentions” for 2021…

You can immediately see that it was an unusual year as 9 segments made the list. Supplies had the biggest increase, +57% and led the way with 6 segments on the list. Supplies became more skewed towards higher income but 97% of demographic segments spent more. Except for Millennials, the segments on the list are generally “low profile” but contributed notably to the industry. We should give special kudos to Millennials, Renters and Unmarried 2+ All Adult CUs. These 3 groups won Honorable Mention in 2 Industry segments and Total Pet.

Although the results were mixed, with numerous individual changes, I saw these trends of note:

  1. Youth Movement – Boomers must inevitably fade. The Gen Xers have stepped up, with the Millennials close behind.
  2. Sub-Urbanization – The Suburbs are the key. Areas <2500 are the top performers but the Suburbs 2500> spend the most. With the exception of pandemic 2020, they are the only area that increased $ every year since 2016.
  3. The “Magic” number is 4+ – As spending skews younger the best performers in all but Food tend to be larger CUs. However, 2 person CUs still have the largest share of $ in every segment and Total Pet. They’re not done yet.
  4. Changes in spending balance – The performance gap between the best and worst narrowed in Food but expanded in the other segments, especially in Supplies. This happened despite a demographically widespread increase.
  5. Income is still the most important factor – The gap between best and worst narrowed in Food, but widened in all other segments, again especially in Supplies. The best performer is always $150K+, while the worst is <$30K.

And Finally, What you have all been waiting for…

THE ULTIMATE 2021 PET SPENDING CUs – Side by Side

Color Highlighted cells are different from Total Pet; * = New in 2021

Methodology – The segments are chosen because they have the highest annual CU spending of any segment in the category. They may or may not have the most total dollars. That would depend upon the number of CUs in the group.

Final Comment – These “winners” further reinforce the key factors in increased pet spending:

Marriage– A commitment to another person demonstrates that you can make a commitment to your pet “children”.

CU Size – The “magic” number continues to increase. It’s now 4+ people in a CU

Homeownership – Owning and controlling your own space has long been a key factor in Pet Parenting.

More space – Small suburbs near a big metro area offer the convenience of the city, plus room for more pets.

Income Matters Most – High Income, A High Paying Occupation, A College Degree, At least 2 Earners. These are characteristics present in all of the Ultimate Pet Spending CUs.

Generation– Boomers have passed the torch to Gen X. Age Note: All 45>54, 50% of 35>44 and 20% of 55>64 are Gen X.

I hope that this Visual Comparison helped you to get a “satellite view” of Pet Industry Spending in 2021. Please refer back to the individual segment reports to get more details.

Attending Global Pet Expo 2023? – It has Everything that you need! But, You Definitely Need a Plan!

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The first Global Pet Expo (APPMA) occurred 65 years ago with 17 exhibitors in 30 booths. The industry & the show have both come a long way since then.  The show is back to a normal size and attendees at GPE 23 will see and experience:

  • 1013 separate exhibitor booths
  • With over 319,000 square feet of booths (Plus 45,000 sq ft for the New Product Showcase) Global Pet Expo 2022 actually occupies about 17 acres of prime Florida “real estate”.
  • 3000+ new items in the New Product Showcase and on the exhibit floor
  • Sharing the aisles with an expected 15,000+ attendees, including more than 6000 “buyers”.
  • The opportunity to choose from 38 different educational seminars – 50 hours of classes
  • 5 miles of aisles – just to walk the exhibit floor

The show floor is open for 24 hours so let’s put this in perspective and… “Do the Math!”

 If you don’t attend any seminars, visit the New Product Showcase, stop to chat with anyone in the aisles or for food, a drink or to go to the bathroom and maintain a walking speed of 2.5 mph, you can spend about 1 minutes and 18 seconds with each exhibitor…You definitely need a plan!

Global Pet Expo definitely has it all… and more. Attendees will find the broadest selection of products and services while Exhibitors have the opportunity to reach a wide range of buyers across all retail channels.

First and foremost, Global is about Pet Products – Food, treats and a vast array of Supply categories. A regular flow of New Products is always critical to keep businesses and the whole industry strong and growing. Obviously, you must take the time to visit the New Product Showcase. You should also sign up for any relevant classes, network with other industry professionals and…walk the whole show.  There are at least twice as many new products being “launched” on the show floor as there are on display in the New Product Showcase. Plus, over 30% of GPE 23 exhibitors did not exhibit at a GPE from 2019>22 and over 2/3 of these companies did no pet show during that period. Global is about gathering information and making decisions to improve your business – whether they are made on the spot or put on your “must do” list.

Every business can improve in terms of products. If you are a retailer, what sections of your store are not doing as well as you hoped and need a “facelift” or conversely, what areas are growing and need products to fill additional space? Category managers for distributors and retail chains may only be interested in targeted visits to exhibitors relevant to their “categories”. Representatives may be looking for new manufacturers…in specific product categories. Manufacturers could be looking to find distributors to handle their products or just looking to “check out” the competition. In regard to products, there is always something to see…for everyone!

And Global is the place to see it. It’s all there! With so much to see and do, Time is perhaps the most valuable commodity at the show. How do you make the most of your time on the show floor? Here’s an idea.

In 2014 I first designed a tool in Excel, the Super Search Exhibitor Visit Planner to make “working Global & SuperZoo easier and more productive for ALL attendees – retailers, distributors, reps, groomers, vets…even exhibitors. I have updated the data and produced a tool for every GPE and SuperZoo since then…including GPE 2023.

The “update” is not just exhibitor lists but also to the product category offerings for every exhibitor. I reviewed every exhibitor profile on the show site, but I also visited over 1000 websites and conducted separate internet searches to “validate” the product offerings. It is not 100% accurate, but it is close.

What does the SuperSearch do?… It searches for and produces a list of Exhibitors by product categories.

  • From the simplest – “give me a list that I can look at on my phone or tablet in either Booth # order or alphabetically”
  • To the most complex…”can do a simultaneous search for multiple specific product categories, allowing you to personally narrow down the initial results and see the “final” alphabetically or by booth number.” The GPE Super Search Exhibitor Visit Planner does both…and more…and does it quickly! Take a look at the Quick Start Guide. You will see that it looks complex but is really quite simple.

GPE 2023 Super Search Exhibitor Visit Planner – Quick Start Guide

First: When you download the Excel file, Remember to Enable Editing & Macros!

The GPE Super Search Exhibitor visit planner is designed to make your time on the show floor more efficient and more productive. With the Super Search you can conduct up to 5 separate and distinct product category searches simultaneously with consolidated results produced in booth # order to facilitate your “journey”. There are detailed instructions for reference and to help you understand the nuances of the tool. However, it is really very simple so let’s get started. (Note: No changes in instructions from 2022) Here is the Dashboard where you set up your searches. ↓

On the dashboard, the first things to note are the numerous category columns. There are 7 different floor sections, 11 different Exhibitor or Animal Types and 33 Dog and/or Cat Product categories. You can search exhibitors for any combination of these.

Let’s take a specific example running 3 simultaneous searches for several Dog/Cat categories:

  • Toys
  • Treats
  • Catnip & Litter (Must sell both)

Now referring to the Dashboard, let’s take it by the numbers:

  • This column is where you activate each search. Type in a “Y” (Cells C3>C7 will auto-capitalize) This search “line” becomes active.(cell turns green) In our example we are running 3 searches so we have 3 “Y”s.
  • Now we enter a 1 in the correct column for each search line. Search Line 1: Toys; Search Line 2: Treats.
  • In Search Line 3 we want exhibitors that sell both Catnip and Litter so we put a 1 in both of these columns.
  • Now we just “click” the Execute Search Button. The searches are done simultaneously and the results combined into a single list in alphabetical order.
  • If you would like to view the list in Booth # order, just click the Booth # Sort.
  • You can switch the list back to an alpha view by clicking the Alpha Sort Button.
  • To Clear all your search categories and start a new search, Click the Clear Criteria Button. Then click Execute (#4) again and you will be back to the full list

Note: Any Search Line with a Y and no 1’s in any column will always deliver the entire list regardless of what is selected in other lines. Change the Y back to an N in unused search lines. Now a sample of the results:

Company A – Has Toys Only; Company B has Dog Treats Only; Company C is on the list for Treats and also has Catnip, but no Litter. This is not unusual as Catnip is often a Treat; Company D has Treats & Toys. Company E has both Catnip and Litter and in fact, actually has it all!

Note: The Super Search highlights your search categories so you know “why you are there”. However, it also shows all categories that are available. Some might “pique” your interest while you are visiting the booth.

You can review the exhibitors alphabetically then put the list in Booth # order to make it easier to “work”. The Super Search also allows you to “cut down” the list during your review. (Pg 2; Point #11 – “U Pick ‘em” in Detailed Instructions) But First, I suggest that you “play” with the Super Search to get a “feel” for the tool, and then review the Detailed Instructions. With your “play” experience, the detailed instructions will become a “quick read” and a valuable reference. You will soon be “up to speed” on the full capabilities of Super Search. Good Luck and Good “Hunting” at GPE 2023!

Ready to Start Planning?

Use the links below to download the Super Search Tool (Be Sure to Enable Editing/Macros/Content if asked by your computer), the Quick Start Guide and the Detailed Instructions. Then GET STARTED!

Click to download Super Search Quick Start Guide (PDF)
Click to download Super Search Detailed Instructions (PDF)

NOW DOWNLOAD THE SEARCH TOOL

(For the Excel file to work on your computer, be sure to enable saving/macros/editing/content if asked.)

Click to download GPE 2023 Super Search Final (Excel)

NOTE: Global Pet Expo 2023 is now over. There were a few exhibitor changes at the last minute. This file shows the final list for your future reference. Changes from the 3/19 version are highlighted.