Retail Channel $ Update – October Monthly & November Advance

/in /by

Due to the shutdown, no CPIs were produced In October. Based upon the Sep/Nov data, we were able to estimate the Oct CPIs using a procedure from the US BLS’ Methodology Manual. Total Retail $ were +1.9% vs 24, 58.4% below their Nov avg (4.8%). Relevant Retail $ were +3.0% vs 24, 34.7% below the 4.7% avg. There are other factors besides the CPI impacting sales, including high cumulative inflation and tarifflation binge buying. It is a complex situation. The problem with YOY drops & the size of sales lifts is still concerning.

We’ll continue to track the retail market with data from 2 reports provided by the Census Bureau and then factor in a targeted CPI. The reports are the Monthly and the Advance Retail Sales Reports. Both are derived from sales data gathered from retailers across the U.S. and are published monthly at the same time. They are about a month late due to the shutdown. The Monthly Report includes data from all respondents, so it takes longer to compile. Although the sample size for the Advance report is smaller, the results have proven it to be statistically accurate with the Monthly. The Advance Report has a smaller sample size so it can be published quickly. The biggest difference is that the full sample in the Monthly report allows us to “drill” a little deeper into the channels.

We will begin with the October Monthly Report and then go to the November Advance Report. Our focus is comparing to last year but also 21 & 19. We’ll show both actual and the “real” change in sales as we factor inflation into the data.

Both reports normally include the following:

  • Total Retail, Restaurants, Auto, Gas Stations and Relevant Retail (removing Restaurants, Auto and Gas)
  • Individual Channel Data – This is more detailed in the Monthly reports, and we’ll focus on Pet Relevant Channels.

The data will be presented in detailed charts to facilitate visual comparison between groups/channels. The charts will show 11 separate measurements. To save space they will be displayed in a stacked bar format for the channel charts.

  • Current Month change – % & $ vs previous month
  • Current Month change – % & $ vs same month last year and vs 2021.
    • Current Month Real change vs last year and vs 2021 – % factoring in inflation
  • Current Ytd change – % & $ for this year vs last year, 2021 & 2019.
    • Current Ytd Real change % for this year vs last year and vs 2021 and 2019
  • Monthly & Ytd $ & CPIs for this year vs last year and vs 2021 which are targeted by channel will also be shown. (CPI Details are at the end of the report – (October data are estimates)

First, the October Monthly. All were up from Sep and there was only 1 actual YOY sales drop, Gas Stations Ytd vs 24. Note: They are still selling more product than in 2019. 3 groups are “all positive”, down from 4 in Aug>Sep. Relevant Retail has been all positive in 20 of the last 24 months and in 16 of the last 18. ($ are Not Seasonally Adjusted)

The Oct Monthly is $1.9B less than the Advance report. Restaurants: +$0.4B; Auto: No Change; Gas Stations: -$0.2B; Relevant Retail: -$2.2B. All were up from Sep. A Sep>Oct lift in Total Retail  has happened every year but 2008 since 1992 but the 4.9% lift was 40% above the 3.5% avg. There was only 1 YOY drop in actual sales, the same as Sep, but 1 less than Mar>Aug. There was 1 “real” sales drop, up from none in Aug/Sep but far less than the 5 in Mar. 3 groups were “all positive”, down from 4 in Aug/Sep, but equal to Mar>Jul. Restaurants still have the biggest increases vs 21 & 19 but Relevant Retl stayed at the top of “real” performance vs 2019. However, only 52.5% of their growth is real.

Now, let’s see how some Key Pet Relevant channels did in October (83% of Oct Ytd Rel Retl $)

Overall– All 11 were up from Sep. Vs Oct 24, 9 were actually & “really” up. Vs Oct 21, 9 were up but only 7 were real increases. Vs 2019, Only Dept Strs were actually & really down, but Off/Gift/Souv were also really down.

  • Building Material Stores – The pandemic focus on home has produced sales growth of 29.9% since 2019. Prices for the Bldg/Matl group have inflated 18.7% from 21 and 23.8% from 2019 which is having an impact. Sales vs Sep were +4.9% for HomeCtr/Hdwe and +6.1% for Farm Stores. Vs other years, Farm stores are actually up for all, but vs Oct 24. Real $ were down vs 21. HomCtr/Hdwe are only actually up vs 21 & 2019. They are really down for all but vs 2019. Plus, only 17% of the Bldg Materials group’s 19>25 lift was real. HomeCtr/Hdwe: Ytd: -2.6%; Avg 19>25 Growth: 4.1%, Real: 0.4%; Farm: Ytd: +4.3%; Avg: 6.4%, Real: 2.6%
  • Food & Drug – Both are essential. Except for the COVID food binge, they tend to have smaller changes in $. Vs: Sep Supermarkets: +4.8%; Drug: +4.0%. In terms of inflation, the Groceries rate is 2+ times higher than Drug/Med products. Drug Stores are positive in all measurements and 70% of their 2019>25 growth is real. Supermarkets’ actual $ are up in all comparisons. They are only “really” down monthly and Ytd vs 21. However, only 9% of their 19>25 increase is real growth. Supermarkets: Ytd: +3.5%; Avg 19>25: +4.9%, Real: +0.5%; Drug Stores: Ytd: +8.1%; Avg: +5.9%, Real: +4.3%.
  • Sporting Goods Stores – They also benefited from the pandemic in that consumers turned to self-entertainment, especially sports & outdoor activities. Sales are +4.2% from Sep, and their only positives are actual & real vs Oct 24 and vs 2019. Prices stopped deflating vs 24. Deflation started in April 23 and was a big change from +1.1% in 22>23 & +7.9% in 21>22. This caused 68% of their 32% lift since 19 to be real. Ytd: -2.2%; Avg 19>25: +4.7%; Real: +3.3%.
  • Gen Mdse Stores – Sales were +8.5% vs Sep, all YOY sales – actual & real were up for $ Stores and SupCtr/Clubs. Dept Stores are negative in all comparisons but vs Oct 24. Their Actual sales are even -29.1% from 19 (Real: -36.1%). The other channels have an average of 42.1% in real growth. SupCtr/Club: Ytd: +2.5%; Avg 19>25: 5.1%, Real: 2.3%; $/Value Strs: Ytd: +2.0%; Avg: +5.5%, Real: +2.7%; Dept. Strs: Ytd: -1.8%; Avg: -5.6%, Real: -7.2%.
  • Office, Gift & Souvenir Stores – Sales skyrocketed +40.2% from Sep. They are now actually up in all comparisons and really down only Ytd vs 21 & 19. Their recovery started late. It was slowly restarting in Jun/Jul, but their progress had slowed. It exploded positively in October. They have mostly recovered. Ytd: +3.9%; Avg Growth Rate: 0.4%, Real: -1.3%
  • Internet/Mail Order – Sales are +8.8% from Sep to $124.8B, an Oct record. All YOY measurements are positive, but their YOY growth, +7.3%, is only 59% of their average since 2019. However, 82.4% of their 124.8% growth since 2019 is real. Ytd: +7.3%; Avg Growth: +14.5%, Real: +12.5%. As expected, they are by far the growth leader since 2019.
  • A/O Miscellaneous – Pet Stores are 22>24% of total $. In May 2020 they began their recovery which reached $100B for the first time in 2021. In 2022 their sales dipped in Jan, Jul, Sep>Nov, rose in Dec, fell in Jan>Feb 23, grew Mar>May, fell Jun>Aug, rose Sep>Nov, fell Dec>Jan 24, grew Feb>May, fell Jun>Sep, grew Oct, fell Nov, rose Dec, fell Jan>Feb, grew Mar>May, fell Jun>Sep, rose Oct. All comparisons are again positive, and they are in 2nd place, behind the Internet, in the % increase vs 19 and vs 21. Also, 77% of their 76.4% growth since 2019 is real. Ytd: +9.3%; Avg 19>25: 9.3%, Real:+7.5%

Oct had a 4.9% lift vs Sep. All Big groups & all 11 smaller channels were up. The YOY Oct lift vs 24 was 3.5% for Total & 4.0%  for Relevant Retl. (Avg for both: 4.6%) Prices are now not deflating in any channel, but cumulative inflation still impacts sales as 4 channels were ‘really’ down vs Oct 21. However, the Retail Recovery has definitely restarted.

Now, Let’s Take an Advance Look at November – First the Big Groups

Oct>Nov sales were down for all but Relevant Retail. An Oct>Nov Total Retail drop has only happened 8 times since 1992. The -0.8% drop is much worse than the +1.2% avg change. There were 3 YOY $ drops, 2 more than Oct. All but Auto were up vs Nov 24, but the Total Retail lift of 1.9% vs Nov 24 was 58.4% below their +4.7% 92>24 avg. The Relevant Retail 3.0% increase vs Nov 24 was 34.7% below their +4.7% avg. Inflation is still a factor. The CPI for all commodities stayed at 1.8% vs 24 but it fell to 8.6% vs 21. There is some Ok “real” news. Only 1 “real” measurement was down, the same as Oct and Gas Stations are again “really” up vs 2019. However, again only 3 Big Groups are all positive, down from 4 in Jul>Aug. Relevant Retail has been all positive in 17 of the last 19 months.

Overall Inflation Reality– The Total Retail CPI stayed at 1.8% but the $ lift vs 24 fell to 58.4% below avg. The Restaurant CPI slowed to +3.6% but their $ lift fell to 32.2% below avg. Gas prices flipped to +1.1%. They are still in turmoil. Auto inflation slowed to 1.7% vs 24 & 21, but sales fell -3.0% vs 24. Avg change: +4.5% – pre-tariff buying is over. Inflation slowed to 1.5% for Relevant Retail. Their lift was 34.7% below avg but they are again all positive. Progress slowed in Nov.

Total Retail – Since Jun 20, every month but Apr 23, Jun 24 & Feb 25 has set a monthly $ales record. In 2023>25, Sales were on a roller coaster. Up Jul>Aug, down Sep, up Oct>Dec, down Jan 24, up Feb>Mar, down April, up May, down Jun, up Jul>Aug, down Sep, up Oct>Dec, down Jan>Feb 25, up Mar, down Apr, up May, down Jun, up Jul>Aug, down Sep, up Oct, down Nov. Prices are 1.8% and YOY $ are +1.9%, 58.4% below the 92>24 avg. 42% of the 19>25 growth is real.  Inflation slowed but cumulative inflation is still impacting sales. Growth: 24>25: 3.7%; Avg 19>25: +6.2%, Real: +2.8%.

Restaurants – They were hit hard by the pandemic and didn’t begin recovery until March 2021. However, they have had strong growth since then, exceeding $1T for the 1st time in 2023. November $ are up vs 24 and they have the biggest lifts vs 21 & 19. Inflation slowed to 3.6% vs 24 but it is +22.5% vs 21 and +32.0% vs 19. Their 3.8% YOY lift is 32% below their +5.6% 92>24 avg. They are all positive again, but just 32.7% of their 56.5% growth since 2019 is real. They are 3rd in performance behind Relevant & Total Retail. Recovery started late but inflation started early. Growth: 5.4%; Avg 19>25:+7.7%, Real: +2.9%. They just account for 13.7% of Total Retail $, but their strong growth has helped Total Retail.

Auto (Motor Vehicle & Parts Dealers) – They overcame the stay-at-home attitude with great deals and advertising. They finished 2020 up 1% vs 2019 and hit a record $1.48T in 2021 but much of it was due to skyrocketing inflation. In 22, sales got on a rollercoaster. Inflation started to drop mid-year, but it caused 4 down months in actual $. Their YE real 2022 sales numbers were even worse, -8.2% vs 21 and -8.9% vs 19. 23 started a sales rollercoaster but the $ hit a record, $1.595T. $ fell in Jan 24, grew Feb>Mar, fell Apr, grew May, fell June, grew Jul>Aug, fell Sep, grew Oct, fell Nov, grew Dec, fell Jan>Feb 25, grew Mar, fell Apr>Jun, rose Jul>Aug, fell Sep, rose Oct, fell Nov. Nov $ were -3.0% vs 24. Avg: 4.5% Like Oct, they are not all positive and just 22.8% of 19>25 growth is real. Growth: 4.0%; Avg 19>25: +5.2%, Real: +1.3%

Gas Stations – Gas Stations were hit hard by “stay at home”. They started recovery in Mar 21, and inflation began. Sales got on a rollercoaster in 22 but set a record, $583B. Inflation started to slow in Aug and prices slightly deflated in Dec & Feb 23, then strongly fell in Mar>Jul to -20.2%. In Aug they rose to -3.7%. In Sep they were +2.7% but began deflating to -4.2% in Feb 24. In Mar>May $ grew, fell Jun, rose July, fell Aug/Sep, rose Oct, fell Nov>Feb 25, rose Mar>May, fell Jun, rose Jul, fell Aug>Oct, up Nov. Nov $ vs 24: +1.9% (4.6% avg). Down Ytd vs 24 & vs Nov 21. Real $ are all positive. Growth: -1.7%; Avg 19>25: +3.3%, Real: 0.1%.They show the cumulative impact of inflation can be positive & negative.

Relevant Retail – Less Auto, Gas and Restaurants– They account for ≈60% of Total Retail $ in a variety of channels. Their only down month until Feb 25 was Apr 20, and they led the way in Retail’s recovery. Sales got on a roller coaster in 22, but all months set new records with Dec reaching a new all-time high, $481B, and an annual record of $4.81T. In 23, the roller coaster continued. A Dec lift set a new monthly record of $494.7B & an annual record of $4.997T. $ales got back on the roller coaster in 24. The ride continued as $ rose Oct>Jan 25, fell Feb, rose Mar>May, fell Jun, rose Jul, fell Aug>Sep, rose Oct/Nov. The Nov 3.0% YOY lift is 34.7% below their 92>24 avg of +4.7%. However, they are all positive again and 42.3% of their 46.7% 19>25 growth is real, #1 in Big Group performance. Growth: 4.0%; Avg 19>25: +6.6%, Real: +3.1%. In 2024 their inflation rate dropped from 3.2% to 0.1%. It rose in 25, peaking at 1.8% in Sep then slowing to 1.5% in Oct>Nov. YOY Inflation is pretty low, but its cumulative impact can slow growth. We’ll see.

YOY inflation is low, but cumulative & impending lifts can affect sales. In Nov, 3 actual YOY $ comparison were negative, 2 more than Sep>Oct. In Aug/Sep, there were no real drops. That rose to 1 in Oct>Nov. In Sep, Gas Stations were down vs 24 & all others up, with above avg lifts. In Oct all were up with below avg lifts. In Nov only Auto was down but the lifts were all below avg. In Oct/Nov, 3 big groups were all positive. (4 in Aug/Sep) Relevant Retail has now been all positive in 17 of 19 months. Nov sales fell vs Oct. The drop was unexpected, but the 2nd smallest since 92. Recovery is still slow.

Here’s a more detailed look at November by Key Channels (98% of November Ytd Rel Retl $)

  • Relevant Retail: Ytd Growth: +4.0%; Avg 19>25: +6.6%; Real: 3.1%. % Real Growth: 42.3%. 7 of 11 were up from October. Vs Nov 24: 9 were up; 8 Real. Vs Nov 21: 8 were up; 7 Real. Vs 19: Only Dept Stores were down.
  • All Department Stores – This group was struggling before the pandemic hit them hard. They began recovery in March 2021. Sales are +29.9% from Oct, but all YOY measurements but vs Nov 24 are negative. Their 0.2% Nov YOY lift is miniscule but a big change from their -4.4% avg. Ytd Growth: -1.5%; Avg 19>25: -5.5%; Real: -7.1%. % Real growth: None
  • Club/SuprCtr/$- They fueled a big part of the recovery because they focus on value which has broad consumer appeal. $ales are +3.9% from Oct, and they are up in all comparisons. Their 1.6% YOY Oct lift is -80% below their 92>24 avg of +7.9%. Ytd Growth: 2.3%; Avg 19>25: +5.1%; Real: 1.4%. % Real Growth: 24.1%
  • Grocery- They depend on frequent purchases, so their changes are usually less radical. $ales are unchanged from Oct, but only really down vs 21. Cumulative inflation has hit them hard, especially monthly & Ytd vs 21. Their 2.2% YOY Nov lift is 32.1% below avg. Ytd Growth: 2.8%; Avg 19>25: +4.8%; Real: 0.4%. % Real Growth: 7.1%
  • Health/Drug Stores – Many stores are essential, but consumers visit less frequently than Grocery stores. $ are -7.7% from Oct but they are positive in all comparisons. Inflation has been relatively low, so it is a bit of a surprise that their +4.5% YOY lift vs Nov 24 is 15.6% below avg. Ytd Growth: 6.9%; Avg 19>25: +5.6%; Real: 4.0%. % Real Growth: 68.9%
  • Clothing and Accessories – Clothes mattered less if you stayed home. That changed in March 2021 with strong growth through 2022. Sales are +18.3% from Oct and positive in all YOY measurements. $ales are +7.4% vs Nov 24, more than double their 3.1% avg. Ytd Growth: 5.5%; Avg 19>25: +3.4%; Real: 2.5%. % Real Growth: 70.4%.
  • Home Furnishings – In mid-2020 consumers’ focus turned to their homes and furniture became a priority. Inflation is up to 2.9% in Nov. $ are +5.3% from Oct but are only up Ytd vs 24 & 19. YOY vs Nov 24, they are -4.1%, far below their 3.2% avg lift. Ytd Growth: 3.0%; Avg 19>25:+2.4%; Real: 0.1%. % Real Growth: 4.5%.
  • Electronic & Appliances – They have had many issues. Sales fell in Apr>May of 2020 and didn’t reach 2019 levels until March 21. $ are +18.0% from Oct and they are only down Ytd vs 21. They have had strong deflation so real sales are all up. Sales are +0.8% vs Nov 24, 63% below the avg. Ytd Growth: 0.6%; Avg 19>25: 0.5%; Real: 3.7%. Real Growth: 12.6%
  • Building Material, Farm & Garden & Hardware – They truly benefited from the consumers’ focus on home. In 2022 the lift slowed as inflation grew to double digits. Prices turned up again in Apr>Sep 25 but dropped Oct/Nov. Sales are down 10.2% from Oct and only up Ytd vs 21 & 19. YOY sales vs Nov 24 were -5.0%, far below their 4.4% Avg. Ytd Growth: -1.8%; Avg 19>25: +4.4%; Real: 0.8%. % Real Growth: 15.9%.
  • Sporting Goods, Hobby and Book Stores – Consumers turned their attention to recreation and Sporting Goods stores sales took off. Book & Hobby Stores recovered more slowly. They have been on a sales roller coaster since June 24 and $ are +19.0% from Oct. Actual & Real sales are only down Ytd vs 21. YOY Sales vs Nov 24 are +5.9%, more than double their 2.8% avg. Ytd Growth: +1.8%; Avg 19>25: +4.2%; Real: 3.4%. % Real Growth: 80.9%.
  • All Miscellaneous Stores – Pet Stores have been a key part of the strong and growing recovery of this group. They finished 2020 at +0.9% but sales took off in March 21 and have continued to grow. Sales are -10.1% vs Oct, but positive in all comparisons. They are 2nd in the % increases vs 19 & vs 21. Plus, their 14.6% YOY Nov lift is 4 times more than their 92>24 avg of +3.7%. Ytd Growth: +9.1%; Avg 19>25: +7.1%; Real: 5.3%. % Real Growth: 70.9%.
  • NonStore Retailers – 90% of their $ comes from Internet/Mail Order/TV. The pandemic accelerated online spending. They ended 2020 +21.4%. The growth continued in 2021 as sales exceeded $100B for the 1st time and they broke the $1 Trillion barrier. $ are +6.8% from Oct but their YOY lift of 5.5% is -44% below the 9.8% avg. However, they are positive in all comparisons. Ytd Growth: 6.9%; Avg 19>25: +13.5%; Real: 11.5%. % Real Growth: 81.5%.

Recap – Driven by Relevant Retail, the Pandemic recovery was widespread by Y/E 21. In 22 we were hit with the strongest inflation in 40 years. Inflation has slowed considerably from its Jun 22 peak but only 1 channel is deflating. Deflation helps, but cumulative inflation can still have a negative impact – slowed YOY growth and even sales drops. $ rose from Oct for 7 of 11 channels. Only 2 of the 7 lifts were above avg. The biggest concern is still YOY drops and smaller lifts. Relevant Retail’s 3.0% lift vs Nov 24 was 35% below avg. 9 channels had a YOY lift vs Nov 24, 1 less than last month. Plus, only 3 of the 9 lifts were above avg, down from 7 in Oct and 6 in Sep. The situation worsened. There are at least 2 major factors. High prices from cumulative inflation and the move to shop earlier for the Holidays. Let’s follow the money. Nonstore, Grocery, SupCtr/Club/$ and Bldg/Farm are the 4 largest channels and account for 73% of Relevant Retl $. Bldg/Farm had a Nov drop while the other 3 had below avg lifts. The biggest YOY lift was in Sep for Nonstore and Oct for the others, so holiday shopping is moving earlier. Also, all are driven by value shopping. We’ll see what Dec brings.

Here are the Oct/Nov inflation rates for the CPIs used to calculate the impact of inflation on retail groups and channels. This includes special aggregate CPIs created with the instruction and guidance of the US BLS. I also researched data from the last Economic Census to review the share of sales by product category for the various channels to help in selecting what expenditures to include in specific aggregates. Of course, none of these specially created aggregates are 100% accurate but they are much closer than the overall CPI or available aggregates. The data includes the CPI changes vs 21 to show cumulative inflation. Note: Oct data are estimates using a procedure from the US BLS’ Methodology Manual.

Monthly YOY CPI changes of 0.2% or more are highlighted. (Green = lower; Pink = higher)

Here are some answers to some obvious questions. Note: The rate of change in CPI’s has definitely slowed.

  • Why is the group for Nonstore different from the Internet?
    • Non-store is not all internet. It also includes Fuel Oil Dealers, the non-motor fuel Energy Commodity.
  • Why is there no Food at home included in Nonstore or Internet?
    • Online Grocery purchasing is becoming popular, but almost all is from companies whose major business is brick ‘n mortar. These online sales are recorded under their primary channel.
  • 5 Channels have the same CPI aggregate but represent a variety of business types.
    • They also have a wide range of product types. Rather than try to build aggregates of a multitude of small expenditure categories, it seemed better to eliminate the biggest, influential groups that they don’t sell. This method is not perfect, but it is certainly closer than any existing aggregate.
  • Why are Grocery and Supermarkets only tied to the Grocery CPI?
    • According to the Economic Census, 76% of their sales comes from Grocery products. Grocery Products are the driver. The balance of their sales comes from a collection of a multitude of categories.
  • What about Drug/Health Stores only being tied to Medical Commodities.
    • An answer similar to the one for Grocery/Supermarkets. However, in this case Medical Commodities account for over 80% of these stores’ total sales.
  • Why do SuperCtrs/Clubs and $ Stores have the same CPI?
    • Big Stores sell more fresh groceries, Groceries account for ¼ of $ Store sales. Same Ctgys – different mix.

Petflation 2025 – December Update: Back up to +3.5% vs Last Year

/in /by

It’s time to catch up with inflation. The Consumer Price Index peaked back in June 2022 at 9.1% then began to slow until it turned up in Jul/Aug 2023. Prices fell in Oct>Dec 23, then turned up Jan>Oct 24 but fell in Nov. However, they rose 10 straight months to a new record high in Sep, then fell Oct>Dec. The CPI vs 24 also slowed to +2.7% from +3.0% in Sep, the high point of 25. Grocery prices rose 0.5% from Nov and their YOY inflation rose to 2.4% from 1.9%. 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.

Petflation was +4.1% in Dec 21 while the overall CPI was +7.0%. The gap narrowed as Petflation accelerated. It was 96.7% of the national rate in June 22. National inflation has slowed considerably, but Petflation generally increased until June 23. It passed the CPI in July 22, fell below it from Apr>Jul 24. It passed the CPI in Aug, fell below in Sep>Oct, rose above in Nov, fell below in Dec>Aug, then passed it in Sep>Oct & Dec. As we drill into the data, all 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 25 vs 24 which will include Pet Segments and relevant Human spending categories. Plus
    1. CPI change from the previous month.
    2. Inflation changes for recent years (23>24, 22>23, 21>22, 20>21, 19>20, 18>19)
    3. Total Inflation for the current month in 2025 vs 2019 and vs 2021 to see the full inflation surge.
    4. Average annual Year Over Year inflation rate from 2019 to 2025
  • YTD comparisons (December = Annual)
    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 Dec 23 to Dec 25. We will use December 2019 as a base number so we can track the progress from pre-pandemic times through an eventual recovery. This chart is designed to give you a visual image of the flow of pricing. You can see the similarities and differences in segment patterns and compare them to the overall U.S. CPI. The year-end numbers from 2023 and 2024 are included. We also included and highlighted (pink) the cumulative price peak for each segment. In Dec, Pet prices rose +0.8% from Nov. All segments were up: Food (+0.2%). Supplies (+0.9%), Vet (+2.0%), Services (+0.2%).

In Dec 23, the CPI was +19.4% and Pet was +21.8%. The Services segments inflated after mid-20, while Product inflation stayed low until late 21. In 22, Food prices grew but the others had mixed patterns until July 22, when all rose. In Aug>Oct Petflation took off. In Nov>Dec, Services & Food inflated while Vet & Supplies prices stabilized. In Jan>Apr 23, prices grew every month for all segments except for 1 Supplies dip. In May Product prices grew while Services slowed. In Jun/Jul this reversed. In Aug all but Services fell. In Sep/Oct this flipped. In Nov, all but Food & Vet fell. In Dec, Supp. & Vet  drove prices up. In Jan>Mar 24 prices grew. In April, prices in all but Vet fell. In May, all but Food grew. In June, Products drove a lift. In July, all but Services fell. In Aug, Food drove a drop. In Sep, Products fueled a drop. In Nov all were up. Prices dropped in Mar & Oct>Nov 25, but all but Food set records in Dec.

  • U.S. CPI – The inflation rate was below 2% through 2020. It turned up in January 21 and continued to grow until flattening out in Jul>Dec 22. Prices rose Jan>Sep 23, fell Oct>Dec, rose Jan>Oct 24, fell Nov, rose Dec>Sep 25 to a record high, then slowed. but 26.1% of the increase since Dec 19 happened from Jan>Jun 22 – 8.3% of the time.
  • Pet Food – Prices were at the Dec 19 level Apr 20>Sep 21. They grew & peaked May 23, then got on a roller coaster. In 25 Jan>Feb↑, Mar>May↓, Jun>Jul↑, Aug↓, Sep↔, Oct>Nov ↓, Dec ↑. 99% of the lift was in 22/23.
  • Pet Supplies – Supplies prices were high in Dec 19 due to tariffs. They had a deflated roller coaster ride until mid-21 when they returned to Dec 19 prices & stayed there until 22. They turned up in Jan and hit a record high. They plateaued Feb>May, grew in June, flattened in July, then turned up in Aug>Oct to a new record. Prices stabilized Nov>Dec, grew Jan>Feb 23. fell in Mar, but the roller coaster went on. Dec>Feb↑, Mar/Apr↓, May/Jun↑, July↓, Aug↑, Sep/Oct↓, Nov/Dec↑, Jan>Feb 25↓, Mar>May↑, Jun↓, Jul↑, Aug↓, Sep↑, Oct>Nov↓, Dec↑(record).
  • Pet Services– Inflation is usually 2+%. Perhaps due to closures, prices increased at a lower rate in 2020. In 2021 consumer demand increased but with fewer outlets. Inflation grew in 21 with the biggest lift in Jan>Apr. Inflation was strong in 22 but prices got on a roller coaster. They turned up Jul>Apr 23, fell May. Jun>Aug↑, Sep>Dec↓, Jan>Mar 24↑, Apr↓, May↑, Jun↓, Jul>Nov↑, Dec>Mar 25↓, Apr>Aug↑, Sep↓, Oct>Dec↑(record).
  • Veterinary – Inflation has been consistent. Prices turned up in Mar 20 and grew through 21. A surge began in Dec 21 which put them above the overall CPI. In May 22 prices fell and stabilized in June causing them to fall below the CPI. However, they rose again & have been above the CPI since July 22. In 23>25 prices grew Jan>May, level Jun/Jul, fell Aug, grew Sep>Dec, fell Jan, grew Feb>May, fell Jun>Jul, grew Aug 24>Sep 25, fell Oct>Nov, grew Dec. (record)
  • Total Pet – Petflation is a sum of the segments. In Dec 21 the price surge began. In Mar>Jun 22 the segments had ups & downs, but Petflation grew Jul>Nov, slowed in Dec, grew Jan>May 23, fell Jun>Aug, grew Sep/Oct, then fell in Nov. In December prices grew through Mar 24 to a record high. Prices fell in April, rose May>Jun, fell Jul>Sep, rose Oct>Nov, fell Dec, rose Jan>Feb 25, fell Mar, grew Apr>Jul, fell Aug, rose Sep, fell Oct>Nov, rose Dec (record)

Next, we’ll turn our attention to the Year Over Year inflation rate change for December and compare it to last month, last year and to previous years. We will also show total inflation from 21>25 & 19>25. Petflation rose from 2.5% to 3.5% in Sep then fell to 2.6% in Nov. In Dec it is again 3.5% and is now 29.6% above the National rate. The chart will allow you to compare the inflation rates of 24>25 to 23>24 and other years but also see how much of the total inflation since 2019 came from the current surge. We’ve included some human categories to put the pet numbers into perspective.

Overall, prices were down -0.02% from Nov and were +2.7% vs Dec 24, the same as last month. Grocery prices rose 0.5% and the CPI rose from 1.9% to 2.4%. The only price decrease from last month was in the National CPI. In Nov there were 6 drops – a big change. The national YOY monthly CPI rate of 2.7% is 7% below 23>24, 21% below 22>23 and 58% less than 21>22. The 24>25 rate is only below 23>24 for Pet Services and Pet Supplies. In our 2021>2025 measurement you also can see that over 75% of the cumulative inflation since 2019 has occurred in 4 segments, Total & all Pet segments but Services. Except for Pet & Vet Services, where prices have surged, Service Segments have generally had higher inflation rates so there was a smaller pricing lift in the recent surge. Pet Products have a very different pattern. The 21>25 inflation surge provided 94% of their overall inflation since 2019. This happened because Pet Products prices in 2021 were starting to recover from a deflationary period. Services expenditures account for 63.8% of the National CPI so they are very influential. Their current CPI is +3.3% while the CPI for Commodities is 1.7%. This shows that Services are driving most of the current 2.7% inflation but Commodities did drive the small price drop from November. There is an even greater disparity in Pet, but products have a bigger share of $. Petflation is 3.5%. The combined CPI for the Service Segments is 6.2%, while the Pet Products CPI is 1.3%.

  • U.S. CPI– Prices are -0.02% from Nov. The YOY rate was stable at 2.7%. It peaked at +9.1% back in June 2022. The targeted inflation rate is <2% so we are 35+% higher than the target. The stability follows Oct>Nov drops, Apr>Sep lifts, Feb/Mar drops, 4 straight lifts and 6 consecutive drops from Apr>Sep 24. The current rate is below 23>24 and the 21>25 rate is still +16.2%, 62% of the total inflation since 2019. Inflation took off in Apr 21, +4.2%, up from 2.6%.
  • Pet Food– Prices are +0.2% vs Nov but +1.2% vs Dec 24. Prices have inflated for 6 straight months, but they are still far below the Food at Home inflation rate of +2.4%. The YOY Pet Food CPI has deflated in 15 of the last 22 months. The 2021>2025 inflation surge has generated 91.5% of the 22.3% inflation since 2019. Inflation began for Pet Food in June 2021, +0.9%, after 12 straight deflationary months.
  • Food at Home – Prices are +0.5% from Nov and the YOY increase rose to 2.4% from 1.9%. This is still radically lower than Jul>Sep 2022 when it exceeded 13%. The 30.6% Inflation for this category since 2019 is 17% more than the national CPI but only in 4th place behind 3 Services expenditures (2 Pet). 58.8% of the inflation since 2019 occurred from 2021>25. This is close to the national CPI rate, but we should note that Grocery prices began inflating in 2020>21 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 surge.
  • Pets & Supplies– Prices were +0.9% from Nov and the CPI rose to 0% from +0.3%. They still have the lowest rate vs 2019. Prices were deflated for much of 20>21. As a result, the 21>25 inflation surge accounted for 100% of the total price increase since 2019. Prices deflated after Oct 22. 3 lifts pushed them to a record high in Feb 23. Prices fell in March & the roller coaster continued. Prices grew Dec>Feb 24, fell Mar/Apr, rose May/Jun, fell July, rose Aug, fell Sep/Oct, rose Nov/Dec, fell Jan/Feb 25, rose Mar>May, fell Jun, rose Jul, fell Aug, rose Sep, fell Oct>Nov, rose Dec.
  • Veterinary Services– Prices are +2.0% from Nov and their YOY CPI vs 24 rose to +7.1% from +5.4%. They remain #1 in inflation vs 24 and are still the leader since 2019 with +48.8% and since 2021, +37.0%. For Veterinary, high annual inflation is the norm. However, the rate has increased during the current surge, especially since 23. They have the highest rate in 25, and 76% of the cumulative inflation since 2019 occurred from 2021>25.
  • 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. Prices were up +0.3% from Nov, but inflation vs 24 slowed to +3.4% from +3.7%. Medical Services are becoming a bigger part of the current surge as now 64.9% of the 16.8%, 2019>25 increase happened from 21>25.
  • Pet Services – Inflation slowed in 20 but grew in 21. In 24 prices surged Jan>Mar, fell April, rose May, fell Jun, rose Jul>Nov, fell Dec>Mar 25 to 3.9%. Apr grew, May fell, June rose, Jul rose to 6.3%. Inflation fell to 5.8% in Aug & continued down to 4.2% in Nov. In Dec it rose to 5.0%. They are #2 vs 24, 21 & 19. 72% of their 19>25 inflation is from 21>25. In Dec 23, it was 49%.
  • Haircuts/Other Personal Services – Prices are +0.7% from Nov and +4.8% from Dec 24. 17 of the last 24 months have been 4.0+%. Inflation has been pretty consistent. 63.6% of the 19>25 inflation happened 21>25.
  • Total Pet– Petflation returned to 3.5% from 2.6%. Vet (+7.1%) led the way but all segments had increased inflation. 3.5% is 75% more than the 23>24 rate and 29.6% above the U.S. CPI. Plus, 3.5% is 13% above the average Dec Total Pet rate since 1997. Dec prices rose +0.8% from Nov, and it was universal – all segments had a Nov>Dec increase. A Nov>Dec increase has happened in 65% of the years since 1997 (avg Chge: +0.16%). The Pet CPI rose from 2.6% to 3.5%, a 35% increase. Another factor enhancing the big CPI lift was that prices fell -0.2% in Nov>Dec 24. Pricing is very important in Retail Sales, but the CPI is a complex measurement.

Now, let’s look at the YTD numbers.

The 24>25 rate is lower than 23>24 for all, but Medical Services & Groceries. The 22>23 inflation rate was the highest for Pet Food & Vet. 21>22 has the highest rate for Pet Supplies, Total Pet, Groceries, Haircuts and the National CPI. 23>24 has the highest rate for Pet Services. The average national inflation in the 6 years since 2019 is 3.9%. Only 3 of the categories are below that rate – Medical Services (2.8%), Pet Supplies (1.9%) and Pet Food (3.5%). It is no surprise that Veterinary Services has the highest average rate (6.6%), but all 4 other categories are +4.3% or higher.

  • U.S. CPI – The 24>25 rate is 2.7%, down 7% from 23>24, but it is down 34% from 22>23, 66.3% less than 21>22 and 30.8% below the average increase from 2019>2025. However, it’s still 80% more than the average increase from 2018>20. 73% of the 26.0% inflation since 2019 occurred from 2021>25. Inflation is a problem that started recently.
  • Pet Food – Ytd prices are still deflating, -0.01%, up from -0.1% in Aug and significantly up from -1.1% in Jan. That’s a big change from 0.2% in 23>24, 10.6% in 22>23 and even the 1.5% 18>20 average. It’s even below 20>21. Pet Food has the highest 22>23 rate but is only #4 in the 21>25 rates. Deflation in the 1st half of 2021 kept YTD prices low then they surged in 22 and especially in 23. 96% of the inflation since 2019 occurred from 2021>25.
  • Food at Home – The 25 inflation rate is +83% vs the 23>24 rate, but at 2.2%, it is down 56% from 22>23, 81% from 21>22 and even 37% less than 20>21. Plus, it is now equal to the average rate from 2018>20. It is only in 4th place for the highest inflation since 2019 but still beat the U.S. CPI by 13.8%. You can see the impact of supply chain issues on the Grocery category as 71% of the inflation since 2019 occurred from 2021>25.
  • Pets & Pet Supplies – A true roller coaster, prices rose Jan>Feb 24, fell Mar>Apr, rose May>Jun, fell July, rose Aug, fell Sep>Oct, rose Nov>Dec, fell Jan>Feb 25, then rose Mar>May. Prices vs 24 flipped from inflation to deflation in June, back to +0.7% in July, slowed to 0.0% in Aug, then rose Sep>Dec. Supplies still have the lowest inflation since 2019. Their biggest YOY lifts since 2019 were in 22 & 23. The 2021 deflation created an unusual situation. Prices are up 11.8% from 2019 but 104% of this lift happened from 21>25. Prices are up 12.3% from their 2021 “bottom”.
  • Veterinary Services – Inflation was high in 2019 and steadily grew until it took off in late 2022. The rate may have peaked in 2023, but it is still going strong in 2025, +6.4%, the highest on the chart. They are also #1 in inflation since 2019 and since 2021. At +6.6%, they have the highest average inflation rate since 2019. It is 69% higher than the National Average but 2.4 times higher than the Inflation average for Medical Services. Strong Inflation is the norm in Veterinary Services.
  • Medical Services – Prices went up significantly at the beginning of the pandemic, but inflation slowed in 2021. In 2025 it is 3.4%, 21% above the 2.8% 2019>25 average rate. We should also note that 3.4% is obviously radically higher than the -0.3% deflation in 22>23.
  • Pet Services – After falling in late 2023, prices surged in 2024, then fell in 2025 until an Apr>Aug lift followed by a Sep>Nov dip and a Dec lift. The 24>25 5.1% CPI is 2nd, behind Veterinary on the chart. It is their lowest rate since 20/21, but it is double their 2018>20 2.5% average rate. Pet Services is also 2nd in both 19>25 and 21>25 inflation.
  • Haircuts & Personal Services – The services segments, essential & non-essential, were hit hardest by the pandemic. The industry responded by raising prices. 2025 inflation is 4.2%, 22% below its 20/21 peak, but 18% above the 18>20 average. Consumers are paying over 30% more than in 2019, which usually reduces the purchase frequency.
  • Total Pet – Petflation is 2.5%, up from 2.4% in Nov, but 4% less than 23>24. However, It’s 4% more than their 18>21 avg but 7% below the CPI. Petflation is still at its lowest rate since early 2021.This was primarily driven by deflation in Pet Products and lower inflation in Services. However, except for Mar/Aug/Oct/Nov, Pet prices have risen in 25.

The Petflation recovery paused in Aug 24, came back Sep>Oct, paused in Nov, resumed in Dec>Jan, paused in Feb, restarted in Mar and paused Apr>Sep. It improved Oct/Nov but paused in Dec. We tend to focus on monthly inflation while ignoring one critical fact. Inflation is cumulative. Pet prices are 24% above 2021 & 29% higher than 2019. Those are big lifts. In fact, Dec prices for all but Food are the highest in history. Note: Pet Food is within 0.8% of its record high. Only Supplies prices (+11.7%) are less than 22.3% higher than 2019. Since price/value is the biggest driver in consumer spending, inflation will affect the Pet Industry. Services will be the least impacted as it is driven by high income CUs. Veterinary will see a reduction in visit frequency. The product segments will see a more complex reaction. Supplies will likely see a reduction in purchase frequency and some Pet Parents may even downgrade their Pet Food. Products will see a strong movement to online purchasing and private label. At SZ and GPE 25, a huge number of exhibitors actively offered their OEM services. Strong, cumulative inflation has a widespread impact, but tarifflation can hit even harder. Supplies would likely be the most impacted by new high tariffs. We’ll see…

 

2024 U.S. PET SERVICES SPENDING $13.65B…Up $0.23B

/in /by

Except for a small decline in 2017, Non-Vet Pet Services had shown consistent, small annual growth. In 2018, that changed as spending grew a spectacular $1.95B. The number of outlets offering Pet Services has rapidly grown and more consumers have opted for this convenience. However, spending plummeted -$1.73B in 2020 due to COVID closures and restrictions. 21>22 brought a spectacular recovery, $5.47B (+79%). Growth slowed in 23 but especially in 24 +$0.23B (+1.7%) to $13.65B. In this report we will drill down into the data to see what groups drove the small 2024 lift. (Note: All numbers in this report come from or are calculated from data in the US BLS Consumer Expenditure Surveys)

Services’ Spending per CU in 2024 was $100.55, up 0.8% from $99.73 in 2023. Note: A 2024 Pet CU (68%) Spent $147.87

More specifically, the 1.7% increase in Total Pet Services spending came as a result of:

  • 0.9% more CUs
  • Spending 2.5% less $
  • 3.4% more often

The chart below gives a visual overview of recent spending on Pet Services

After the big lift in 2018, spending stabilized in 2019. Increased availability has significantly increased Services spending, despite a return to a normal inflation rate, +2.4%. However, inflation grew to 2.5+% in the 2nd half of 2019 and spending declined slightly. The 2020 pandemic brought restrictions and closures which drove spending radically down. In 21>22 it grew spectacularly despite 4.9% inflation in 21 & 6.3% in 22. In 23, inflation was 5.7% so real growth was only 2.7%. In 24, 7.0% inflation made the 1.7% lift a real -4.9% drop. Let’s look at the demographics of 2024 Services spending.

First, by Income Group.

In 2023 <$50K & $70>100K had big drops. The biggest lifts came from higher incomes, especially $200K> which was up $1.16B. In 2024 the only lifts were by $70>100K and over $150K. The biggest lift was +$0.82B from $150>200K. The 2024 50/50 dividing line in $ for Services was $156K, up from $147K last year and still by far the highest of any industry segment. It is readily apparent that income is overwhelmingly the primary driver in Pet Services spending.

  • <30K (20.1% of CU’s) – $19.06 per CU (-30.5%) – $0.52B, ↓$0.27B (-33.8%) – This segment is shrinking and money is tight, so Services spending is less of an option. Inflation was even higher in 24 and spending fell 33.8% to $0.52B.
  • $30>70K (27.6% of CU’s); $44.27 per CU (-11.7%); $1.66B, ↓$0.25B (-13.0%) – This low-income group is shrinking but they were the only group to spend more in 2020>23. In 24 their $ dropped. $30>50K: -$0.02B; $50>70K: -$0.23B
  • $70>100K (14.4% of CU’s) – $89.02 per CU (+35.6%) – $1.74B, Up $0.50B (+40.0%) – The spending of this middle income group slowly but consistently grew 2016>19, plummeted in 2020, rebounded somewhat in 2021, then took off in 2022, a 61% lift. In 2023, they had the biggest drop. They fully recovered in 2024 with a +40% lift.
  • $100>150K (16.3% of CU’s) – $117.07 per CU (-10.6%) – $2.59B, ↓$0.34B (-11.8%) – They had consistent growth from 2016>19. In 2020 they had the biggest drop. Growth returned 21>23 but their $ fell to the 2022 level in 2024.
  • $150K> (21.7% of CU’s) – $243.03 per CU (-1.3%) – $7.14B, Up $0.59B (+9.0%) – Spending fell 2019>20, then it took off in 21>24. They generate 52% of Services total $ and their CU spending is still over 2.4 times the national average.

Now, let’s look at spending by Age Group.

In 2023 <25, 35>64 & 75> spent more. In 2024 only 25>34, 45>54 & 75> had $ increases. The biggest was from 45>54 as they moved up to #1. The 35>64 age range has the 3 highest income groups and generates 2/3 of all Services spending. Here are the specifics:

  • 45>54 (16.3% of CU’s)- $161.10 per CU (+33.4%) – $3.57B – Up $0.83B (+30.1%) This highest income group was #1 in Services $ in 2019 and held on in 2020 despite a 20% frequency drop. In 2021 they had the only $ drop and fell to #3. In 2022/23 they became #2. In 2024 as 2.4% less CU’s spent 15.9% more $, 15.1% more often, they returned to #1.
  • 55>64 (17.6% of CU’s) $118.58 per CU (-12.0%) – $2.84B – ↓$0.39B (-12.1%) 2017>19 had small A big drop in frequency drove spending down in 2020 but they had a strong recovery 21>23 and took the top spot in Services $ in 2021. They held on in 23 but fell to #2 in 24 as 0.1% less CUs spent 13.8% less $, 2.0% more often.
  • 35>44 (17.9% of CU’s) – $110.61 per CU (-4.0%) – $2.69B – ↓$0.04B (-1.3%) A $1B increase in 2018 pushed them to #1. In 2019>20 spending fell. In 21 they moved up to #2. In 22 $ grew 18% but they fell to #3. In 23 their $ grew but they stayed #3. In 24 2.8% more CU’s spent 7.0% less $, 3.2% more often causing a small drop but they are still #3.
  • 65>74 (16.6% of CU’s) – $71.85 per CU (-26.3%) – $1.62B – ↓$0.48B (-22.9%). This group is very value conscious and growing in size. From 2017>19 their spending was stable. In 2020 it fell 20%. In 2021>22 they came back strong. In 23 spending fell but not as much as the 22.9% drop in 24 when 4.6% more CU’s spent 24.3% less $, 2.6% less often.
  • 75> (11.6% of CU’s) – $65.05 /CU (+25.5%) – $1.03B – ↑$0.22B (+27.1%) They have a big need for pet services, but money is always an issue. In 2019 they had a big lift but gave it back in 2020. In 21>22 spending surged but slowed to +6.2% in 23. In 24, spending jumped up +27.1% as 1.3% more CU’s spent 14.6% more $, 9.5% more often.
  • <25 (4.9% of CU’s) – $10.09 per CU (-63.6%) – $0.07B – ↓$0.10B (-59.4%) After 2018 spending fell and essentially stabilized from 2019>23. In 24 Services $ fell to almost $0 as 10.9% more CUs spent 47.8% less $, 29.9% less often.

Earlier, we saw that income was a big driver in Services spending, so it is no surprise that the 3 highest income age groups, 35>64, account for 66.7% of all Services $. They also have the only performance over 100% ($ share/CU share). 25>34 is close at 90.1%. Pet Services offer great benefits, but you need to have/find the money to get them.

Finally, here are some key demographic “movers” that drove the  lift in Pet Services Spending in 2024. The segments that are outlined in black “flipped” from 1st to last or vice versa from 2023. A red outline stayed the same.

You see slightly less stability in 2024. There were 5 that held their position and 2 flips from last to 1st or vice versa. In 2023, 7 held their position and there were also 2 flips. Also, no categories had no segments that spent less on Services. In 2023 there were 2. In fact, in 2024, 46 of 92 segments (50%) spent more on Services than last year. In 2023 the percentage was 75%. So, 2024 was not as good as 2023 but it wasn’t actually bad. Growth has definitely slowed but it is still happening although not as demographically widespread.

You see from the graph that, 8 of 12 winners’ changes were substantially larger than the losers’. 3 of the demographic categories had losers’ changes that equaled or exceeded the winners’ change. Also, regardless of the demographic category, there was always at least 1 segment that spent less on Services. 2024 was definitely not as good as 2023.

3 of the winners held their spot. Pet Services are a regular part of their Pet Parenting, and its importance continues to grow. The winners also demonstrate the importance of income to Services. While this segment has become more demographically widespread, higher incomes dominate. 7 of the 12 winners are either 1st or 2nd in income in their categories. The only winner that is a true surprise is African Americans – low pet ownership and the lowest income.

Many of the losers are not unexpected. Most have below average income, but some don’t. The 4 biggest surprises are:

•     Self-Employed    •   $100>149K    •    White, Not Hispanic    •   Baby Boomers

We should note that the biggest $ drop was by the Boomers. In 21>23 they increased their Services spending by $1.2B

In 2024, only 50% of demographic segments spent more on Services than in last year. This is down from 75% in 2023 but much better than 21% in 2020. The segment has strongly recovered. However, when you factor 7.0% inflation into the 2024 numbers, the 1.7% lift was really a -4.9% drop and only 13% of demographic segments really bought more Services. The recovery has definitely slowed. There is one spending trend that must be noted. Income continues to be the biggest factor in Services spending and its importance is growing. The 50/50 income dividing line in Services spending is now up to $156,000. That is 50% more than the average CU income and 86% more than the median income. $156K> is 23% of all CUs but accounts for 50% of Services $ and 64% of the $6.7B Services $ increase from 2020.

Overview – After the huge lift in 2018, Services spending plateaued in 2019. That changed with the pandemic in 2020. Like many retail services segments, Pet Services outlets were deemed nonessential and subject to restrictions. This resulted in a radically reduced frequency of visits and was the biggest reason behind the 20% drop in spending.

2021 and 2022 brought a strong recovery with the 2 biggest increases in history. They totaled $5.5B and spending grew by +79.4% from 2020. 2022 Spending was even +41.7% higher than the pre-pandemic peak of $8.72B in 2018. The segments that were hit the hardest by the pandemic generally had the strongest recovery. Both big lifts were largely driven by the same groups, but in 2022, 93% of all segments spent more. With continued high inflation, growth slowed markedly to 8.5% in 2023. 75% of segments had an increase in spending but only 60% had lifts that exceeded the inflation rate. In 2024 the situation worsened. The spending lift slowed to +1.7%. This lift was primarily driven by a 3.4% increase in purchase frequency but only 50% of segments spent more. The inflation rate was 7.0% so the 1.7% lift was really a 4.9% decrease in the amount sold and only 27% “really” bought more. Pet Services have become more important to Pet Parents and the Pet Industry, but growth is increasingly being driven by high income. However, many households still find the $ to fill this need.

 

 

2024 U.S. PET SUPPLIES SPENDING $23.91B…Up $0.89B

/in /by

Total Pet spending rose to $118.87B in 2024, up $1.27B (+1.1%) from 2023. After a record $8.65B (+57%) increase in 2021 the Supplies segment fell in 22. Recovery began in 23 and continued in 24, up $0.89B (+3.9%) to $23.91B. (Note: All numbers in this report come from or are calculated by using data from the US BLS Consumer Expenditure Surveys)

Supplies Spending fell -$4.6B 2018>20 due to Tarifflation and COVID. In 2021, Pet Parents caught up as spending rose a record $8.65B. In 2022, it plateaued in the 1st half then fell sharply in the 2nd half. 2023 had a 1st half lift & a 2nd half drop. 2024 had a small increase. We’ll drill down into the data to determine what/who drove the 23>24 3.9% lift in Spending.

In 2024, the average household spent $176.15 on Supplies, up 3.0% from $171.08 in 2023. (Note: A 2024 Pet CU (68%) Spent $259.04) The 3.0% CU lift doesn’t exactly match the 3.9% total $ increase. Here are the specific details:

  • 0.9% more CU’s
  • Spent 1.5% less $
  • 4.6% more often

Let’s start with a visual overview. The chart below shows recent Supplies spending history.

Since the great recession, spending in the Supplies segment has been driven by price. Although many supplies are needed by Pet Parents, when they are bought and how much you spend is often discretionary. When prices fall, consumers are more likely to buy more. When they go up, consumers spend less and/or buy less frequently.

2014 was the third consecutive year of deflation in Supplies as prices reached a level not seen since 2007. Consumers responded with a spending increase of over $2B. Prices stabilized and then moved up in 2015.

In 2015 we saw how the discretionary aspect of the Supplies segment can impact spending in another way. Consumers spent $5.4B for a food upgrade and cut back on Supplies – swapping $. Consumers spent 4.1% less, but they bought 10% less often. That drop in purchase frequency drove $1.6B (78%) of the $2.1B decrease in Supplies spending.

In 2016, supplies’ prices flattened out and consumers value shopped for their upgraded food. Supplies spending stabilized and began to increase in the second half. In 2017 supplies prices deflated, reaching a new post-recession low. The consumers responded with a $2.74B increase in Supplies spending that was widespread across demographic segments. An important factor in the lift was an increase in purchase frequency which was within 5% of the 2014 rate.

In 2018 prices started to move up in April and rapidly increased later in the year due to the impact of new tariffs. By December, Supplies prices were 3.3% higher than a year ago. This explains the initial growth and pull back in spending.

In 2019 we saw the full impact of the tariffs. Prices continued to increase. By yearend they were up 5.7% from the Spring of 2018 and spending plummeted -$2.98B. The major factor in the drop was a 13.1% decrease in purchasing frequency.

2020 brought the pandemic. Prices deflated but with retail restrictions and the consumers’ focus on needed items, both the amount spent and frequency of purchase of Supplies fell.

In 2021 the recovery began with a record lift. Pet parents bought all the supplies that they had been putting off for 2 years. 2021 spending ended up where it was headed in 2018 before being “derailed” by outside influences. In 2022 inflation took off and spending fell -$1.87B. In 2023 spending increased, primarily because of inflation which slowed in the 2nd half. In 2024 inflation slowed to 0.9% from 2.6% in 2023. Although YOY inflation slowed significantly, retail prices were at a record high. This was a factor in the small 3.9% lift.

That gives us an overview of the recent spending history. Now let’s look at some specifics regarding the “who” behind the 2024 lift. First, we’ll look at spending by income level, the most influential demographic in Pet Spending.

National: $176.15 per CU (+3.0%) – $23.91B – Up $0.89B (+3.9%).

$ for the $30>70K group were unchanged but only <$30K spent less. The 50/50 $ divide moved up to $120K from $117K.

  • <$30K (20.1% of CUs)- $70.75 per CU (+3.5%); $1.93B– Down $0.03B (-1.4%). This group is very price sensitive, but they still need Supplies. Their Total Supplies $ only fell because they have 4.8% fewer CUs.
  • $30K>70K (27.6% of CUs)- $119.61 /CU (+1.5%); $4.48B – No Chg $0.00 (0.0%). This lower income group matches the spending pattern of the $150K+ group. 2019 Tarifflation and 2022 inflation had big impacts. 23>24 $ were unchanged. $30>50K were down, but $50>70K was up. <2019 they were the leader in Supplies $. Now, they’re 3rd.
  • $70>$100K (14.4% of CUs) – $179.76 per CU (-0.2%); $52B – Up $0.10B (+3.0%). Lift due to 3.3% more CUs. Consistent spending until 2020 hit them hard. They rebounded strong in 2021 and spending grew slightly in 22>24.
  • $100K>$150K (16.3% of CUs) – $231.93 /CU (+8.0%); $5.13B – Up $0.32B (+6.6%). They had the 2nd biggest COVID drop and the 2nd biggest recovery. In 22, they had a 14.0% lift. In 23 their $ fell 3% but they came back +6.6% in 24.
  • $150K> (21.7% of CUs) – $301.53 per CU (-4.1%); $8.86B – Up $0.50B (+6.0%). This highest income group often has the biggest drops and lifts. In 23 they provided 93% of the Supplies lift. This came from 12.3% more CUs. In 24, the situation was similar. 10.5% more CUs spent 4.1% less but provided 56% of the Supplies increase.

With high prices, income matters. Only $70K> spent more but 92.1% of the overall lift came from $100K>.

Now, we’ll look at spending by Age Group.

National: $176.15 per CU (+3.0%) – $23.91B – Up $0.89B (+3.9%)

In 2024 the age group spending rollercoaster got simpler. Under 35: ↓; 35>44: ↑; 45>54: ↓; Over 55: ↑

  • 45>54 (16.3% of CUs) $238.59 per CU (+0.3%); $5.29B – Down $0.12B (-2.2%). From 2007>18 & in 23/24 this highest income group was the leader in Supplies $. They had a pandemic drop but strong growth in 21>23. The lift ended in 2024 as 2.4% less CU’s spent 11.5% less, 13.4% more often. However, they stayed #1 in $.
  • 35>44 (17.9% of CUs) $214.02/ CU (+13.1%) $5.20B – ↑$0.73B (+16.3%) They are #2 in income & expenditures. Inflation drove their $ down in 2019 but COVID had little impact. Spending took off in 21, fell in 22, then grew slightly in 23 & strongly in 24 as 2.8% more CUs spent 2.6% more $, 10.3% more often. They are still #2 in $.
  • 55>64 (17.6% of CUs) $197.62 /CU (+7.8%); $4.73B – Up $0.34B (+7.8%). Tarriflation caused a spending drop in 2019. Spending fell in 2020 as they binge bought pet food. They had a strong recovery in 21. Growth slowed in 22. $ fell in 23 but rose in 24 as 0.1% less CUs spent 13.4% more on Supplies, 4.9% less often. They stayed #3.
  • 65>74 (16.6% of CUs) $151.90 per CU (+4.5%); $3.43B – Up $0.29B (+9.4%). This older group is very price sensitive so rising prices caused them to cut back on spending in 2019. Like the 25>34 yr-olds, they also increased spending in 2020 and spending soared in 2021. However, unlike the 25>34 yr-olds and despite high prices, their spending grew in 22>23 and even more in 24 as 4.6% more CUs spent 2.3% more, 2.2% more often.
  • 25<34 (15.0% of CUs) $155.96 per CU (-5.7%); $3.17B – Down $0.32B (-9.1%). After trading Supplies $ for upgraded Food and Vet Care in 2016, these Millennials turned their attention back to Supplies. Tarriflation hit them hard in 2019 but they actually increased spending in the pandemic. The lift grew even stronger in 2021 but then spending fell slightly in 22>23 and even more in 24 as 3.5% less CUs spent 11.5% less $, 6.5% more often.
  • 75> (11.6% of CUs) $99.87 per CU (+42.1%); $1.58B – Up $0.48B (+44.0%). This low-income group is price sensitive but they are committed to their pets. Their spending was severely impacted by COVID but they strongly recovered in 21/22. Their $ fell in 23 but spiked in 24 as 1.3% more CU’s spent 25.0% more, 13.7% more often.
  • <25 (4.9% of CUs) $78.51/CU (-54.5%) $0.53B – Down $0.52B (-49.5%). It looks like they cut their Supplies spending in every possible way in 2024 as 10.9% more CUs spent 41.9% less $, 21.6% less often.

Supplies spending was again on an age roller-coaster but the most notable trend may be that <35 spent $0.84B less.

Next, let’s take a look at some other key demographic “movers” in 2024 Pet Supplies Spending. The segments that are outlined in black “flipped” from 1st to last or vice versa from 2023. The red outline stayed the same.

In 2024, even with only a small increase, 64.1% of segments still spent more. In 2023 it was 66%. There was again 1 Category  in which all spent more, Race/Ethnic. In 2023 it was Housing. In 2024 there were 11 “flips” but none that held their spot. In 2023 there were 9 “flips” and 5 “holdovers”. 2024 clearly had more turmoil and less stability than 2023.

5 winners are the “usual suspects”:  • Masters/Phd.    • $200K>    • 2 Earners    • Mgrs/Profess.    • Suburbs 2500>

4 are surprising:  • 4 People    • South    • Homeowner w/o Mtge    • Hispanics

Among the losers, most often show up here. There are only 2 big surprises:  • $150>199K    • Married, Couple Only

After the post pandemic binge buy in 21, Supplies spending fell $1.86B (-7.8%) in 22. This was not surprising after the record $8.65B lift. It is very similar to the binge/bust pattern in Food. Although spending fell by $1.9B, 52% of 92 demographic segments spent more on Supplies. In 23 spending grew $1.08B (+4.9%) as 65.6% of demographics spent more. In 24 spending was +$0.89B (+3.9%) and the demographic spending lift was 64.1%. There is a key factor to put Supplies spending in a better perspective. Many Supplies cartegories have been commoditized and are more susceptible to price changes. Prices fell 2016>18 and spending grew by $5B. Prices rose in 2018>19 and spending fell -$4.6B. In 22 inflation was 7.7%. That means that the amount of Supplies purchased in 22 was “really” -14.4%, almost double the actual $ drop. In 23 Supplies spending grew by $1.08B (+4.9%). Inflation was 2.6% so the “real” lift was +2.3%. (47% real) In 24 inflation slowed to 0.9% but spending was only up $0.89B (+3.9%). The “real” lift was 2.9% (75% real). Supplies are more discretionary, but many are needed for a better life. Supplies spending is moving to higher incomes but perhaps Pet Parents are becoming less sensitive to the high prices from cumulative inflation. We’ll see.

 

2024 U.S. PET FOOD SPENDING $40.04B…Down ↓$5.46B

/in /by

Total Pet spending reached another record high of $118.87B, up $1.27B (+1.1%). All segments but Food increased sales. Pet Food had a record drop while Veterinary $ continued double digit growth. Supplies & Services $ were up <4.0%. The big bad news was Pet Food. Their record decrease put them only 3.5% above 2022 and for the 1st time they are not the spending leader. Product inflation slowed but it is still strong in both Service Segments. Here are the 2024 $ specifics:

  • Pet Food – $40.04B; Down -$5.46B (-12.0%)
  • Pets & Supplies – $23.91B; Up $0.89B (+3.9%)
  • Veterinary – $41.26B; Up $5.60B (+15.7%)
  • Pet Services – $13.65B; Up $0.23B (+1.7%)

The industry truly is a “sum” of its integral segments, and each segment has very specific and often very different buying behavior from the many consumer demographic segments. For this reason, we’re going to analyze each of the industry segments first. This will put the final analysis of Total Pet’s 2024 Spending into better perspective. Note: The numbers in this report come from or are calculated by using data from the current and past US BLS Consumer Expenditure Surveys. In 2024, this was gathered by the U.S. Census Bureau from over 42,000 interviews and spending diaries. The final data was then compiled and published by the US BLS. All inflation numbers are also provided by the US BLS.

We will start with the formerly largest Segment, Pet Food (& Treats). In 2024 Pet Food Spending totaled $40.04B in the U.S., a -$5.46B (-12.0%) decrease from 2023. Pet Food inflation was 0.2% in 2024 so the record drop was “really” slightly worse in the amount of product sold than the actual numbers. In earlier research we discovered a distinct, long-term pattern in Pet Food Spending. In 2018 we broke the pattern due to outside influences – 1st the FDA warning, then with COVID in 2020. In 24, the pattern returned with a record $ drop. Here is Pet Food Spending since 1997 in full Retail Dollars and adjusted for inflation.

The pattern began in 1997. Retail Pet Food Spending increases for 2 consecutive years then reaches a plateau year or even drops. There was a notable exception in the period from 2006 to 2010. During this time, there were two traumas which directly impacted the Pet Food Retail market. The first was the Melamine recall, which resulted in radically increased prices as consumers insisted on made in USA products with all USA ingredients. The second affected everyone – the great Recession in 2009. This was the first time that annual U.S. retail spending had declined since 1956. The net result was that the plateau period was extended to include both 2009 and 2010.

For 20 years, Pet Food was driven by short term trends. A new trend catches the consumers’ attention and grows …for 2 years. Then sales plateau or even drop…and move to the next “must have”. After 2014, the changes  became bigger and the situation got more complex due to a number of factors starting with the move to high priced super premium foods, but including increased competition, especially from the internet, and behavioral changes, like increased value shopping. In 2018, outside influences came into prominence. The first was the FDA warning on Grain Free dog food. This caused many Pet Parents to back away from certain foods. When the warning was declared bogus, the Food segment began to recover. Then came COVID. Fear of possible shortages caused some groups to binge buy food. That ended and spending dipped in 2021. It turned up again in 22>23. Much of the lift was due to 10+% inflation. As expected, $ fell in 24. Of note: Considering inflation, only 38% of the 97>24 growth is real. Now, let’s take a closer look at spending since 2014.

First, some specifics behind the $5.46B (-12.0%) decrease to $40.04B. In 2024, the average U.S. Household spent a total of $295.90 on Pet Food. This was an -12.5% decrease from the $338.33 spent in 2023, which doesn’t exactly “add up” to the -12.0% decrease in total Food Spending. With additional data provided from the US BLS, here is what happened.

  • 0.6% more U.S. CUs
  • Spent 4.0% less $
  • 8.9% less often

By the way, if 68% of U.S. CUs are pet parents then their annual Pet Food Spending is $435.15. Here’s a rolling history.

2014 marks the beginning of the Super Premium era. It began in the 2nd half of 2014 with the 25>34-year-old Millennials making the 1st move. In 2015 the Baby Boomers got on board in a big way, producing a $5.42B increase in spending, the biggest lift in history at the time. 2016 saw a spending change that was accelerated by the high prices of Super Premium Pet Foods. After consumers upgraded to a more expensive pet food, their #1 priority became, “Where can I buy it for less?” Value Shopping on the internet was a major contributing factor in the big spending drop in 2016.

2017 was an up year which should have been due to a “must have” trend. However, a closer look at the data showed that the $4B increase in Pet Food spending in 2017 came not from a new trend but from a deeper demographic penetration of Super Premium foods. Value shopping in a highly competitive market, especially on the internet, had made Super Premium pet foods more accessible to a broad swath of consumers.

Like Pet Food, human behavior has changed over the years in regard to our pets. In the 90’s, Pet Owners became Pet Parents. Then, after 2000 we began truly humanizing our pets, which is very accurately reflected in the evolution of Pet Food. We became more focused on fulfilling the health needs of our pets, beginning with the first move to premium foods in 2004. This radically increased after the Melamine scare in 2007. Now consumers read pet food labels, research ingredients and expect their pet foods to meet the same quality standards as the best human foods. This was very evident in 2018. It should have been a year of increased spending but the consumers’ reaction to the FDA grain free warning threw the pattern out the window. In 2019 the warning lost credibility. Pet Food spending stabilized in the 1s half of the year and then grew by $2.3B in the 2nd  half. Some Pet Parents began to return to the topline Super Premium Foods while others opted for even more expensive varieties. Also, new groups got on board the Super Premium Express.

After the 2019 recovery came the pandemic of 2020. There is nothing more necessary to a Pet Parent than pet food. This spurred binge buying, especially in the 1st half of the year and drove the biggest annual spending increase in history. However, binge buying doesn’t increase usage and it causes an overstock in home supply. In 2021, Pets “ate down” the extra food so spending fell. Another factor was the ongoing strong search for value & convenience which continues to drive many consumers online. In 2022, Pet Food spending returned to a more normal pattern. In 2023, there was a record lift driven by 10.6% inflation and a 6% lift in frequency. Inflation slowed to 0.2% in 2024 and the transaction size dropped by 4%. However, the biggest change was in purchase frequency, -8.9%. Together, these factors produced a record $5.46B decrease in spending.

Even with the 2024 drop, the growth of Pet Food spending since 2014 reflects the rise of Super Premium but also another trend – the spectacular increase in the number and use of Pet Medications and Supplements, which are often produced in the form of treats. Together, the strength of Pet Food and these product subcategories reflect the Pet Parents’ top priority – the health, wellbeing and safety of their Pet Children, which starts with the quality of their food.

Now let’s look at some specific 2024 Pet Food Spending Demographics. The first is income. Prior to 2014 it was less of a factor in Food spending. However, the move to Super Premium has brought it more to the forefront. In 2015 the spending of the $70K> group exceeded the <$70K for the 1st time. In 2024, both <$70K & $70K> had drops but <$70K was -$4.2B while $70K> was only -$1.3B. All big groups but $70>100K were down but <$30K had the biggest drop. In 2015, the 50/50 divide on Pet Food spending was about $70K. By 2020, it was up to $107K. In 2022 it had fallen to $91K, but rose to $93K in 2023 and to $99K in 2024. That’s 5% less than the average CU income but 18% more than the median income. Higher income is increasing in importance in Pet Food spending. All CUs over $70K have 100+% performance ($ Share/CU Share) but the $150K> group is the best at 135%. The chart below shows annual spending for major income groups from 2018>2024. This should put the 2024 numbers into better perspective.

In 2023 and 2017 all major income groups spent more on Food. In 2024, only $70>100K spent more – a big change. Since 2018, we have seen the major impact on various groups by outside influences. In mid-2018 it was the FDA grain free warning. In 2020 it was the pandemic and in 2022 it was the first inflation spike. In 2023, consumers adapted to high prices. However, in 2024 “value” became a top priority. Some downgraded but many moved online or to private label.

    2024 National: $295.90 per CU (-12.5%); $40.04B; ↓$5.46B (-12.0%);  2018>2024: Up $11.20B (+38.8%); Avg: +5.6%

The biggest drops came from the Highest and lowest income groups, which clearly shows that value/price is important to everyone, regardless of income. The only spending increase was by the $70>100K group. This was not unexpected. They have fewer children than $100K> CUs so they have money to spend on pets.

Here are 2024 specifics:

  • Under $30K: (20.1% of CU’s) – $162.17 per CU (-29.7%) – $3.92B – ↓ $2.71B (-40.9%). Obviously, this group is very price sensitive. The number of CU’s was down 4.8% in 2024 and their avg CU income only grew by $208. Even with a $68 drop in Pet Food, their avg CU total expenditures rose by $540 – a big change from a -$682 drop in 2023. Their financial situation obviously got worse in 2024. Their spending lift in 2023 was likely due to an upgrade in Food. The drop in 2024 is so large that many CUs downgraded their Pet Food. They still spend 0.47% of their Total CU expenditures on Pet Food. The national avg is 0.38%. They remain committed Pet Parents.
  • $30K>$70K: (27.6% of CU’s) – $242.33 per CU (-17.0%) – $9.62B – ↓ $1.48B (-13.3%). They are also very price sensitive, so inflation had an impact. Their average income was up 0.3% while the national average increased by 2.4%. They had a 1.5% decrease in the number of CUs and a 0.4% decrease in CU spending. Their total Pet Food spending was down but it was driven by the $30>39K group. The $30>39K group lost 2.6% in CUs and CU Food spending was -41.8% & $ were -$1.97B (-46.9%). The $40>49K group fell -0.1% in CUs but their CU Food spending was +18.4%. Their $ were +$0.56B (+3.9%). $50>69K lost -1.6% in CUs and spent -11.2% less per CU on Pet Food. Their Pet Food $ only dropped by $0.04B (-0.8%). Behavior was mixed – upgrading, downgrading & value shopping. They are still committed to their pets, spending 1.09% of total expenditures on their pets and 0.45% on Pet Food.
  • $70K>$100K: (14.4% of CU’s) – $329.78 per CU (+4.1%) – $6.97B – Up $0.53B (+8.2%). This group has an up/down spending pattern. They committed to Super Premium food in 2017, but they have been very sensitive to outside influences – the FDA warning in 2018, COVID in 2020 and inflation in 2022. They have big family responsibilities and are under monetary pressure. They got used to inflation and made a comeback in 2023 which continued in 2024.
  • $100>150K (16.3% of CU’s) – $353.48 per CU (-11.4%) – $7.81B – ↓ $0.57B (-6.9%). They drove the binge buying of Food in 2020. It was pure emotion, but they had the $ to do it. In 2021, they had an expected big drop. In 2022, inflation and a 9.6% increase in CU’s drove a 23% increase in $. In 2023 they had 7.4% more CUs and spent 22.5% more $ per CU…+$1.67B. In 2024, 1.3% less CUs and CU spending dropped, most likely due to value shopping.
  • $150K> (21.7% of CU’s) – $415.26 per CU (-15.4%) – $11.72B – ↓ $1.23B (-9.5%). Their Pet Food CU spending fell by 15.4%, but CUs increased by 10.5%. Total $ were -9.5%. There may be some downgrading but most of the drop was due to value shopping or switching to private label. In performance, share of $/share of CUs, their score of 135.2% is only exceeded by a subgroup of theirs, $200K>, with 148%. Higher income is even more important.

The pandemic certainly caused turmoil. First, the fear-based binge buying, which caused a record increase in 2020. This couldn’t be repeated so spending fell in 2021. Spending returned to more normal, positive behavior in 2022 as only the $70>100K group spent less. In 2023 Inflation was high, but the welfare of their Pet children mattered more than the price, so most Pet Parents just paid more – a record lift. In 2024, we expected and got a drop. It was a record -$5.46B. It was widespread but focused <$70K. The 50/50 $ split moved up from $93K to $99K. High income matters even more.

Now, Spending by Age Group…

   2024 National: $295.90 per CU (-12.5%); $40.04B;  ↓$5.46B (-12.0%);  2018>2024: Up $11.20B (+38.8%); Avg: +5.6%

The 45>64 yr-old groups spent more, while all others spent less.

  • 65>74 (16.6% of CU’s) – $298.48 per CU (-27.8%) – $6.58B – Down $2.42B (-26.9%). This group is all Baby Boomers. They are starting to retire but many are still working (0.7 per CU). Their Pets are a priority. In 24, they spent 0.46% of their total CU expenditures on Pet Food, the highest % of any group but a big drop from 0.64%. Also, until the drop in 24, they are the only group to spend more on Pet Food every year since 2016. In 2024, 1.3% more CUs spent 13.1% less $, 16.9% less often. A downgrade by some CUs seems likely. Value shopping is a certainty.
  • 55>64 (17.6% of CU’s) – $361.15 per CU (+2.7%) – $8.71B – Up $0.23B (+2.7%). This group has been at the forefront of recent major spending swings. In 2015 they upgraded to Super Premium. In 2016 they shopped for a better price. In 2017 they led a deeper penetration of the upgrade. In 2018 they had a -$3.5B reaction to the FDA warning. They began to recover in 2019 but then came 2020, which saw a huge lift in spending. There were 3 major factors. First was binge buying due to pandemic. They also were still recovering from the FDA warning. Finally, the pandemic caused the loss of over 2 million <25 CUs. Many of them moved back with their parents bringing their pets with them. In 2021, there was a big drop in food $ as they “ate up” the extra stock and many of their kids moved out. In 2022 inflation brought a big lift. In 2023 they increased value shopping. In 2024 they had a small lift but were essentially stable as 0.02% more CUs spent 6.0% more $, 3.1% less often.
  • 35<44 (17.9% of CUs)- $292.96 per CU (-16.9%) – $7.04B – down $1.40B (-16.6%). They are 2nd in income & spending but have the biggest families. Until 23 their spending pattern matched the 45>54 yr-olds. In 23 their total Pet Food spending exceeded the older group. In 24 they fell behind as 0.4% more CUs spent 9.0% less $, 8.7% less often.
  • 45>54 (16.3% of CU’s) – $374.77 per CU (+11.5%) – $8.23B – Up $0.78B (+10.4%). This group is #1 in income and CU expenditures. Up until 2015 they were #1 in Pet Food spending. They didn’t “buy in” to Super Premium until 2017. They were negatively impacted by the FDA warning but strongly rebounded. In 2020, their spending dropped significantly. Much of the decrease was due to value shopping on the internet. In 2021, they opted for even more expensive food, spending 24% more on each purchase. In 2022, despite strong inflation, their purchase frequency and $ grew. In 23, their $ fell a little but this reversed in 24 as 1.0% fewer CUs spent 11.7% more $, 0.3% more often
  • 25>34 (15.0% of CU’s)- $256.17 per CU (-22.0%) – $5.56B – Down $1.26B (-18.5%). In the early Super Premium years their spending often foreshadowed the overall market for the next year. In pandemic 2020 they spent 22.3% more. Their $ stabilized in 21>22, then surged in 23. In 24 they fell as 4.5% more CUs spent 16.8% less $, 6.3% less often.
  • 75> (11.6% of CU’s) – $217.29 per CU (-6.8%) – $37B – Down $0.20B (-5.6%). Pet Parenting becomes harder as we age. They strongly moved to Super Premium Food in 2021. In 2022, inflation impacted them as many downgraded. In 23 they strongly rebounded but this slowed in 24 as 1.2% more CUs spent 4.7% more $, 10.9% less often.
  • <25 (4.9% of CU’s) – $93.14 per CU (-65.7%) – $0.56B – Down $1.19B (-68.1%). Many moved in with other adults or got married. They value shopped and likely downgraded food as 7.2% less CUs spent 38.1% less $, 44.5% less often.

In 2020 the 55>64 yr olds binge bought Pet Food. In 21 their spending naturally plummeted, the only decrease by any age group. In 22 we had high inflation. It affected everyone. In 23, there was a widespread spending surge. In 24, this flipped as the only lifts came from 2 older high income age groups.

Next, let’s take a look at some other key demographic “movers” in 2024 Pet Food Spending. The segments that are outlined in black “flipped” from 1st to last or vice versa from 2023. The red outline stayed the same.

The first thing that you notice is that the biggest decreases are radically larger than the biggest increases. We should also note that in 1 demographic category all segments spent less on Pet Food in 2024 than in 2023. The drop was also widespread as 81.5% of 92 demographic segments spent less than in 2023. These are signs that Pet Food spending was not doing well. Also note: 2024 was the 1st year in history that Food was not the biggest Pet $ segment. You can see that 17 of the 24 segments flipped from last to first or vice versa. Last year there were 4. None held their position from 2023. In 2023 there were 4 the same as 2022. There was a lot of change and almost no stability.

Only 3 of the winners are the “usual suspects”:

  • Gen X      ●   45>54 yrs old      ●   Married Couple Only

But there are 5 big surprise winners:

  • No Earner, 2+ CU      ●   $40>49K      ●   Asians      ●   Center City       ●   Occupation Not Defined

These winners indicate that despite the resulting high prices from cumulative inflation, there is a strong commitment to premium pet foods that is widespread across demographic categories.

Among the losers, 5 of the segments are not unexpected:

  • Singles     ●   Single, No Earner     ●   1 Person     ●   <$30K    ●   65>74 yrs old

There were 5 surprises. Most have higher incomes.

  •    Boomers    ●   Homeowners w/mtge     ●   White, Not Hispanic    ●   BA/BS Degree    ●   Suburbs 2500>

The 2023 $6.81B (+17.6%) increase was the biggest in history. It was widespread across 87.5% of 92 demographic segments. In 2024 it was followed by a -$5.46B (-12.0%) drop, also the biggest in history. It too was widespread across 81.5% of demographics. Pet Food spending is now up $8.85B from 2019, +28.4%, a growth rate of 5.1%, 4% less than the 5.3% from 2014>19. In terms of inflation adjusted sales, the amount of Pet Food sold in 2024 is only 4.3% more than in 2020. Pet Food Inflation was 10+% in 22/23, slowed to 0.2% in 24 & -0.5% in the 1st half of 25. We’ll see what happens.