AcatplayswithatoyduringPetFairAsiainShanghaiinAugust.(ZHANGLONG/FORCHINADAILY)
Drivenbytheincreasingnumberofpetsandtheevolvingdemandsofconsumers,China'spetindustryhasseenstronggrowthinrecentyears,propellingproductinnovationsthatprioritizehealthandnutrition.
Sincethebeginningof2024,newlyregisteredenterprisesrelatedtothepetindustryreached945,000inChina,theEconomicInformationDailyreported.Thepetcaremarket'ssizetotaled279.3billionyuan($39.6billion)inurbanareasin2023andisexpectedtojumpto361.3billionyuanby2026.
AccordingtomarketconsultancyiiMediaResearch,petfoodreachedamarketscaleof190billionyuanin2023andisexpectedtoreach267billionyuanin2025.
TheWhitePaperonChina'sPetFoodIndustry,publishedbyDeloitteChina,forecaststhepetfoodmarketwillreach114billionyuanby2026,withpetstaplefood,nutritionproducts,andsnacksexpectedtogrowatacompoundannualgrowthrateof17percent,15percent,and25percent,respectively.
Demandforpetfoodandsuppliescontinuestorise,andthemarketisexpectedtogrowataCAGRof13.1percentoverthenextfiveyears,accordingtoareportjointlyreleasedbytheAsiaPetAllianceInstituteandEuromonitorInternational.
Thissurgeinconsumerdemandisreflectedinthestrongperformanceoflistedcompanies.ChinaPet,aveteranplayerinthesector,reportedarevenueof1.96billionyuaninthefirsthalfofthisyear,markinga14.1percentyear-on-yearincrease.
Thecompany'snetprofitalsogrew,up48.1percentyear-on-yearto140millionyuan.Itsgrossprofitmarginroseby3.33percentagepoints,reaching28.98percent,withstaplepetfoodscontributingmosttothisgrowth.
Withcompetitionheatingupandconsumerpreferencesbecomingmoresophisticated,China'spetsectorispoisedforcontinuedgrowthandinnovation,drivenbyacommitmenttohealth,technology,anduserengagement.
HaoBo,deputydirectoroftheAsiaPetAllianceInstitute,saidofthegrowingconsumerpreferenceforhigh-endfreshandfunctionalpetfoods,"Wehaveobservedashifttowardmorerefinedproductssuchashigh-endfreshfoodsandfunctionalstaplefoodsthatcatertothehealthandnutritionalneedsofpets."
Pethealthisbecominganincreasingconcernforconsumers.JDHealthdatashowagrowingfocusonpethealthcare,withproductsforjoint,dental,liver,andimmunesupportexperiencingrapidsalesgrowth.
LiuRui,managerofJDHealth'spethealthdivision,saidthatpetownersarewillingtoinvestmoretoimprovetheirpets'qualityoflife,particularlyforagingpets.
Thepetfoodsectorhasalsoattractedattentionfromdairycompanies,withbrandslikeYiliGroup's"Yibao"focusingonlactose-freeandgut-health-enhancingdairyproductsforpets.
Sincethelaunchofits"Yibao"seriesinOctober2023,YiliGrouphasrapidlyascendedtothetopofthepetmilkcategory,boastingmillionsinmonthlysales.
Asscientificfeedingconceptsgaintraction,thedemandforrefinedpetfeedingsolutionsisontherise.Thepetdairymarketholdssignificantpotential,thoughcompetitionisfierce.
"Petsareoftenlactoseintolerant,makingthedevelopmentofhigh-quality,low-lactose,orzero-lactosedairyproductscriticalforgrowth,"thecompanysaid.
Sellersintroducepetparrotsvialivestreamingduringthisyear'sPetFairAsia.CHINADAILY
Meanwhile,Novonesis,formedthroughthemergerofNovozymesandChr.Hansen,hasintroducedinnovativebiologicalsolutionstothepetindustry.
Thecompanydebutedthreekeyofferings—enzymaticpetgrooming,probiotics,andodorremoval—positioningitselfasaleaderinbiotechnologyforpets.
YeXiaofeng,vice-presidentatNovonesisAsia-Pacific,said,"Biotechnology-basedsolutionsarethekeytoaddressingthesechallenges,makingpetproductssafer,healthier,andmoresustainable."
Inaddressinghealthissuesinpets,suchashairballsanddigestiveproblemswithgroomingcats,Novonesishasintroducedamildenzymatichairtreatmentsolution.Thiscanbeincorporatedintohaircareproductsorfunctionalpetfoodstohelpmanagehairball-relatedissues,ensuringbetterintestinalhealthforcats.
Astechnologicaladvancementsreshapetheindustry,companiessuchasHangzhouPatriegIntelligentPetTechnologyCoLtdarepushingboundariestoimprovelivingconditionsforpetstokeepthemhealthier.
Patrieg's"SmartPetCabin"series,equippedwithfreshair,heating,andmonitoringcapabilities,attractedsignificantattentionattherecentPetFairAsia2024exhibitioninShanghai,receivingover1,100professionalbuyersfrom27countriesandregionsandsecuringcontractsformorethan30,000units.
Patrieg'sfounder,JiangXiaomeng,saidthepotentialofsmarttechnologyisexpectedtoplayanincrementalroleinthepetsector,comparingtheir"SmartPetCabin"tohowsmartphonesdisruptedtraditionalphones.
Howtobetterengagewithpetownersisconsideredkeytowinningmoreconsumers.E-commerceremainsacriticalchannelfortheindustry,with80.6percentofpetownerspurchasingtheirmainpetfoodthroughtraditionalonlineplatforms.
DuringtheJune18ShoppingFestivalthisyear,onlinepetconsumptionexperiencedsignificantgrowth,withsalesofnicheproductssuchas"catanddogbakedgoods"and"catanddograincoats"increasingbyover100percentand166percentyear-on-year,respectively.
Additionally,livestreamingplatformsarebecomingincreasinglypopular,withthenumberofpetownerspurchasingthroughthesechannelsrisingby6.3percentagepointsin2023comparedto2022,accordingtoTianfengSecurities.
On-siteengagementhasalsobecomeafocusformanybrands.ChenNiehan,vice-generalmanagerandCEOofPeidi,apetfoodproducer,emphasizedtheimportanceofbalancingonlineandon-siteefforts.Peidireportedastrongfirsthalf,withrevenueincreasingby71.64percentyear-on-yearto845.6millionyuan,andnetprofitsoaringby329.38percentto97.9millionyuan.
"Thisyear,weareintroducingmoreengagementcampaignsincitieslikeShanghai,Beijing,andChengdutoboostbrandloyaltyandenhanceourinteractionswithconsumers,"hesaid.
Thegrowingpetmarkethasalsoboostedthepetinsuranceindustry.
Awhitepaperonthedevelopmenttrendsofthedigitalpetinsuranceindustryin2023,jointlyreleasedbyZhong'anInsuranceandAntInsurance,reportsthatcatinsurancepolicieshavesurpasseddogpoliciesintermsofgrowthandcoverageforthesecondconsecutiveyear,withcatinsurancenowaccountingforover60percentofpolicies.Themostpopularinsurancetypesincludethird-partyliabilityandmedical.
Despitethesegains,thewhitepapernotesthatthedomesticpetinsurancemarketisstillinitsearlystages,withanoverallpenetrationrateoflessthan1percent,signalingroomforsignificantfuturegrowth.