March 12 , 2015 - The pet industry has seen amazing growth over the past 15+ years. And there is a very specific reason for that.
During the economic boom following the Great Depression and World War II, over 75 million children were born. These children, known as Baby Boomers, were the largest generation of Americans to be born in US history, and the first generation of 'humanizing' pet lovers.
As this generation aged and became empty-nesters they grew to consider their pets as replacement 'kids,' lavishing even more discretionary funds on them with innovative toys, sports and activities, healthier foods and treats, supplements, higher levels of veterinary care, day care, pet sitting, grooming and more.
The Baby Boomers are completely responsible for the phenomenal growth of the pet industry over the past 15+ years. But times are changing; and we're beginning to see, and will continue to see, a transitional and leveling off phase in the growth of the pet industry.
According to the American Pet Products Association’s annual report on pet industry spending, Americans spent $58 billion in 2014 on their 397 million pets. As pets have become more of an important part of the family spending has grown well over the years with spending growth at 4.2 percent from $55.72 billion in 2013 to $58.04 billion last year.
The only category that decreased in size was the sale of animals with a 2 percent drop from $2.23 billion in 2013 to $2.15 billion in 2014. Pet ownership rates tend to drop among people in their golden years. And Boomers are starting to hit retirement age, with the oldest turning 69 this year.
If not already, pet product and service providers should look ahead to when the Baby Boomers decrease the number of pets as part of their families due to fixed incomes, smaller homes, and/or health issues, and a new generation comes forward as the primary pet product and service purchaser.
In summary, there are three specific reasons a transitional and leveling phase in the pet industry will occur within the next year or two:
- The economy continues to steadily grow following the recent recession, however it isn't projected to grow like it did during the Baby Boomer years.
- Baby Boomers are aging and with that comes a current and projected decrease in pet ownership and a consequent leveling off of pet product and service purchases.
- The upcoming generations, Gen X and Millennials, are a very different breed of individuals and have very different lifestyle and purchasing habits than the Baby Boomer generation, particularly relating to pets.
But all is not doom and gloom for our industry. There is much opportunity in the coming years if you understand who will be buying pet products and services in the future, what products and services they will want and need, and how best to market to them.
With these thoughts in mind we see various pet product and service trends coming for 2015-2016.
Quality will prevail, but cost savings will be the deciding factor.
As the economic landscape continues to challenge many, pet loving consumers are looking for high quality at a good price in an effort to maximize their pet product and service dollar. We see this continuing in the near future with Baby Boomers, and also see it continuing well into the next generations, as Gen X and Millennials have grown up in an age of economic challenge and have become very cost conscience consumers.
Healthy will reign.
The pet food recall of 2007 was a big wake up call for pet loving consumers who were outraged by the harm that came to their pets, and the pets of their friends and family. Since then it's been a challenge for consumers to fully understand what pet food and treats are healthier, and what products will keep their pet safe and thriving.
The trust they once had in pet food and treat companies has been tarnished; yet consumers still have a hard time understanding who they can believe and if the claims they read and see are true or just marketing spin.
Over the past years the Internet has provided a wealth of information to consumers through a wide variety of well-respected and not so well-respected sources as to what is best to feed their pet. Consumers have gradually and consistently gravitated toward higher priced, premium (and in some cases raw and dehydrated whole foods) in an effort to provide a healthier, safer diet for their pets.
The days of believing what they read, what pet food and treat companies say, listening to the advice of their veterinarian on what foods and treats are best for their pet are over for many and will be over for many more to come. As the generations following the Baby Boomers have learned, 'you can't believe everything you read.' It takes a wealth of research from a wide variety of trusted sources to convince Gen X and Millennials on the best foods and treats for their pets.
Consequently it will be imperative for pet food and treat companies to not patronize consumers, but to be completely truthful in their marketing and advertising, sympathetic to their concerns, responsive, as well as open and honest in their communications in order to retain and garner new pet loving customers.
Not only will this be important, but more and more we will see companies being held accountable for marketing claims through legal actions and regulatory organizations.
While healthier, organic pet foods and treats will continue to grow, we will also see other health oriented products and services grow and develop over the coming years.
We see these including weight and health management tools to help consumers understand what is the 'standard' for health and weight for their particular pet. These tools may come in the form of technology and wearable tech to monitor pet's health and activity; through mobile apps that help pet loving consumers make more informed and educated decisions about diet, health and activity; online educational opportunities to more fully understand diet, health, and exercise for their particular pet; and more sophisticated and interactive toys, games and activities that help pets get more exercise with and without their human.
In the areas of healthcare services, we will continue to see more and more sophisticated veterinary services and procedures for pets that mirror human healthcare, helping pets live longer and healthier lives. Everything from the proliferation of MRIs & CTs to stem cell therapies, transplants, stent procedures; and alternative treatments such as massage, acupuncture, chiropractic and more.
These services will continue to increase in cost as they have over the past years, consequently making pet insurance a more and more attractive alternative. We see, however, that it will be important that consumers shop around for pet insurance, just as they would shop around for any insurance for themselves, as services, prices, pre-existing conditionals and other terms and conditions are often not made clear enough to the consumer prior to signing and become a problem later on in their pet's life. We see this mostly unregulated pet service will be pushed (by consumers) to be more regulated as time goes by, as we've recently seen in California.
As humans have seen supplements and herbal remedies assist their health in a wide variety of ways, we will also see continued growth in the pet supplement category.
We also see increased services pertaining to the aging pet population including in-home hospice services and out-of-home senior care, as consumers look for services to care for their senior and ailing pets.
With this healthcare growth, comes complicated and difficult to understand healthcare issues for pet parents; consequently we wouldn't be surprised if we see the beginning growth of health care and information management practitioners for pets added to practices and as independent consultants.
It's going to be all about the lifestyle.
As cognition labs study how pets think, and trainers better understand how pet learn, we'll see more and more products and services develop that help pets have a better, more well-rounded, lifestyle.
Expect to see everything from toys and activities that stimulate not just the mind, like interactive puzzle games and toys, but the senses; as well with products and services that help a pet play and be stimulated in a variety of ways while their pet loving parents are at work or away, or at home or away engaging with them.
Interactive games and toys for pets have been on the market for some time, but we believe we will see an increase in these products to a wider pet loving market as pet parents strive to help them have a happier, healthier, more well-adjusted pet. Pet loving parents will increasingly see the benefit of playing and exercising with their pets, and will have the resources and services to help them learn how they can do this easily and efficiently.
Groomers, day cares, dog walking and pet sitting services will need to expand their range of services to more fully satisfy the needs of the pet loving consumer to be successful. Areas of expansion we see will include alternative care, health care management, nutritional counseling, interactive and integrated play services and more.
Integrating pets into busy lives is always challenging. With this in mind we will continue to see growth in products and services to help pet loving consumers integrate their pets into their total life with expanded and full services for off-site and on-site total care.
We will also see continued growth within the travel industry in a variety of products and services catering to pets including hotels, airlines, and consolidated resort facilities catering to both pets and pet parents.
Made in the USA. Sink or swim?
Jaded by the recent recalls and pet health concerns over foods, treats and toys made in other countries, it will become more and more important to pet loving parents that the products they purchase for their pets are sourced and made in the US.
With this comes a higher price. But as we've stated before, quality will be very important to the present and future pet product purchaser, and healthier and safer will be an overwhelming consideration in their final decision. Companies that source and make their products in the US will have an advantage not only now, but in coming years.
Retailers will need to step it up!
With big box and many other large companies now targeting the pet loving consumer with products and services, retailers will need to step up their game in the coming years. By providing a more full service and/or niche service to their current and prospective customers, retailers will have an edge in becoming a trusted and reliable, full lifestyle resource for pet lovers.
Manufacturers and service providers will need to be more innovative and bold.
You may think that everything a dog would need in life has been invented and is currently or soon to be on the market, but think again. Many innovative and creative companies and individuals are designing and bringing to market a wide variety of toys, games, pet care and lifestyle services that will do well in contributing to a more full and happier, healthier lifestyle for pets that satisfies even more of their senses. We will see everything from scent related toys to unique and helpful services come to market in the coming years that will help pet lovers engage, entertain, and manage their pets lifestyles more completely.
Consumers will want more from pet related product companies and service providers.
The pet industry has done well in reaching, speaking to and connecting with the most prolific pet purchasing consumers in the past years, aka the Baby Boomers. But the upcoming consumers, Gen X and Millennials, will demand more from companies and service providers within the pet category to be convinced to purchase their products and/or services.
Pet related product companies and service providers will need to be much more creative in reaching these new segments, while still satisfying their marketing 'speak' to the Baby Boomers. Not reaching out to these new generations the way they want to be marketed to now will create a void and dip in sales in the coming years.
The new pet loving consumer will demand high service, responsiveness, stellar customer service, full disclosure, strong ethical marketing, truth in advertising and want to be reached in a variety of ways through presumer marketing, demographic marketing, testimonial marketing, location based marketing, free, open communications, on a more personal level and in a very prolific way.
These new pet industry consumers will not be as loyal to a company or a service provider as the past Baby Boomer generation has been, creating a marketing challenge for retailers and manufacturers. They will demand higher quality at a good price and will be educated enough to do their research from a wide variety of resources, ultimately coming to their own conclusions. If your company is not involved in that 'research' mix you may lose out on the opportunity.
The pet industry is currently a $58B+ industry, with over 45% of households owning a cat and over 56% owning a dog. Pet ownership is flattening, however the monetary growth of the industry continues to grow at a rate of approximately $2-3B per year.
We see growth within the industry continuing in the coming years, but the focus of that growth will need to change as the wants and needs of the current and upcoming consumer changes. There will be a lot involved in how the pet industry markets to the next generation of pet product and service purchasers (Gen X and Millennials). Trust, reliability, frequency, truth, and abundance will be key to reaching these individuals and speaking directly to them in a way that will push them to act.
As the economy has become more stable, we have seen a boom of consolidation and acquisition within the pet industry and an influx of capital as investors see future opportunity. We expect to continue to see larger brands dive more effectively and prolifically into the pet industry in an effort to gain pet loving consumers as customers. A continued increase in co-branding, private labeling, partnerships and licensing deals will continue as companies look to bring more products and services to their current and prospective market.
In addition we see more and more US pet related companies look toward International markets for growth and expansion opportunities, as these markets pick up steam in pet industry growth. Countries showing significant opportunity include Asian markets.
Legislative influences will continue to affect the pet industry as concerned consumers strive to be a champion for pets. Everything from the push to ban sales of pets in pet stores to lobbying for involvement in the FDA in regulating pet foods, as well as individual and state actions in banning certain ingredients in pet food, and more.
Pet business who move and act to change with the times and align their businesses, products and services to the current and future wants and needs of the new pet loving consumer will be much more successful in the short and long term, and better position themselves to evolve and become a respected leader in their market.
Leslie May, founder of Pawsible Marketing, is a 30 year marketing veteran, with over 8 years in the pet industry. This is her sixth year investigating and predicting trends within the pet industry. Prior to becoming an independent marketing and branding consultant for the pet industry, May held executive marketing positions with VIFI (an Internet banking company), Wellpoint, Anthem, Macmillan Publishing and more. With branding as her passion, May has been featured in Entrepreneur Magazine's "10 Branding Successes (and How They Did It)," listed as one of Entrepreneur Magazine's 100 Brilliant Ideas, and featured along with Oprah, Martha Stewart, Lillian Vernon and more in a new book 'Entrepreneurial Women: New Management and Leadership Models.'. She now lives in a cabin in the mountains of North Georgia with three dog agility obsessed herding dogs and two senior cats. Learn more about May and her company by visiting the Pawsible Marketing website and blog.
American Pet Products Association
March 12 , 2015 - The pet industry has seen amazing growth over the past 15+ years. And there is a very specific reason for that.
Your wading through all the information, samples, business cards, photos and more from Global Pet Expo, so what's next?
After spending thousands of dollars it's imperative that you act now to make the most of your involvement whether you are a retailer looking to add new products and/or services to your business, or a manufacturer wanting to increase the sales of your products, or a service provider looking to gain more clients.
What you do now will make all the difference in reaching the expectations you had when your committed to attending Global Pet Expo.
The following are our top six essential things you need to do now to make the most of your involvement and recoup the marketing expenses you incurred to attend:
Sort through all the contacts you made at the show, review your notes and send thank you notes to visitors to your booth; whether they be high level current prospects or prospects for your future. Contact now will keep you top of mind with every visitor to your booth and help you begin to build a relationships with those you hope to work with soon and later.
Follow up, follow up, follow up.
I can't stress this enough with my clients to make following up with prospects and leads a top priority. According to the Center for Exhibition Industry Research (CEIR), nearly 80% of leads generated are never followed up. Start by focusing on the top leads first, the most important prospects you made and those most seriously interested in what you have to offer; then progress through the remainder of your list. Remember you don't have to completely 'close the sale' at this point, the important thing is to 'close to the next step'.
Keep your promises.
Were you asked to send a sell sheet? A brochure? An order form? A replacement order? Did you receive new orders? Throughout the show, it's my bet that your top level and other prospects asked for something. Fulfill all your promises and requests as soon as you return to the office to positively maintain current and new business contacts, and build and solidify your relationship.
Measure your success.
We always recommend to our clients to perform a complete evaluation to gauge the success of involvement in Global Pet Expo, immediately following the show and six to eight months later. When evaluating your involvement measure the number of qualified and unqualified leads you received, the number of contacts and orders placed immediately and at later dates, the number and quality of other contacts you made, i.e., media, partnerships, private label ops, etc. Then weigh those potential and current sales against the cost of attendance to see the value of your involvement.
If you haven't already we highly recommend you immediately post and talk about your involvement on all your social media sites. Hopefully you did this throughout the days of the show, as well. Show off your booth, talk and post about those you met, post photos and repost any important announcements you made at the show, go through your contacts social media and repost their involvement, and engage with your prospects and contacts, ask questions and more.
Keep top of mind.
The most important thing you can do is keep top of mind and do not let your contacts and leads forget about you. Remember, they are busy too. So, keep up with them over time. Sales don't happen overnight.
For more information about how you can get the most from your the trade shows you attend for your pet business, contact us today for a 30 minute free consultation.
Along with Oprah, Martha Stewart, Rachael Ray and Lillian Vernon, Leslie May, founder of Pawsible Marketing, is included as a contributor and highlighted in a new book, Entrepreneurial Women: New Management and Leadership Models, available on Amazon and Google Books.
In the chapter, 'You Are What You Brand,' author Louise Kelly reviews the history of personal and individual branding beginning with Lillian Vernon in the 1950's, through Oprah and Martha Stewart today, and explores the downside of creating a personal brand with the individual as the 'face' and the name of the brand.
Kelly highlights Leslie May as the creator of a brand that is positioned as an extension of the individual, rather than the individual herself, and why this positioning will help the company evolve and grow beyond the individual.
Entrepreneurial Women: New Management and Leadership Models explores how women everywhere are empowering themselves socially and economically through entrepreneurship and business ownership. The work draws on empirical studies, data sets, case studies, and descriptions of career trajectories to portray the realities of women entrepreneurs today.
Author Dr. Louise Kelly is a professor of Strategy at the School of Management at Alliant International University in San Diego, California. She has a PhD in Strategic Management from Concordia University, Montreal. She specializes in international strategic entrepreneurship research- looking at top management team leadership, from a social networks perspective,
Read more excerpts from the book.
Individuals are bombarded by advertising and marketing messages on a daily basis.
How many? If you Google the question you get a wide variety of answers with the most prolific information indicating individuals are exposed to anywhere from 247 to 3000 ads (via TV, websites, the Internet, radio, paper media and more). My estimate is more in the 250-500 range.
With all this bombardment, it's difficult to stand out in a sea of ads and get noticed by prospective and current customers.
This is why shocking advertisements have become 'popular.' Their aim is to "deliberately, rather than inadvertently, startle(s) and offend(s) its audience by violating norms for social values and personal ideals," according to Darren W. Dahl, et. al in a report from 2003 entitled "Does It Pay to Shock? Reactions to Shocking and Nonshocking Advertising Content among University Students."
Shock advertising may seem like it has it's advantages. It can be done with a lower budget, helping a company garner more attention per dollar spent. It can increase the chances of going viral on social media. And can be stickier to those targeted.
But the downside or disadvantages of shock advertising includes a high amount of creativity to pull off a successful shock campaign that may take a lot of targeted marketing research to estimate if the creative accomplishes the goal. And, if not done correctly, it can damage a brand if the ad 'crosses the line,' sometimes even to the point of inviting legal and regulatory issues.
Shock advertising may be effective and possibly lead to increased brand awareness and sales, but it may also be so negative with some consumers, that it creates a negative impression toward the brand.
In addition shock advertising is and has become 'ubiquitous,' losing it's 'shock' value and going out of favor by those who have become 'shell shocked,' leading to ineffectiveness, and potentially creating a negative impact, as well.
To understand how advertising works you have to understand that individuals react to advertisements from many perspectives, leaving their 'take away' varied in many ways.
The principle measure of ads and marketing communications is the recall of the commercial content. To make an ad effective individuals need to remember the brand as well as the product/service advertised.
If individuals feel anger, their anger may overshadow their memory of the ad message. If the ad is overly sexual for those that are offended by sexual content, the memory recall of the product/service may wane. If the ad isn't memorable at all, then the product and service will not be recalled. You see where this is going.
Matching the emotion of the ad to the specific target individual's potential emotional response to the ad is the key to memory recall and consequently allowing the individual to remember the product and/or service.
One of the biggest risks a firm takes in using shock advertising is that it can alienate its consumers and create a negative image in the minds of consumers. Studies have shown that consumers are less likely to buy products from a brand who uses offensive advertisements if similar products are available from a firm who does not make use of this type of advertising (An & Kim, 2006).
What one person sees as offensive, another may find funny. Take the GoDaddy Super Bowl commercial for example. While the rescue and pet related community online (primarily baby boomers) was very offended and up in arms over the ad, many of the Gen Y, Gen X generation individuals I talked with who don't frequent the dog loving community online (but are dog and pet lovers) thought the ad was funny and meant to be a parody. Which is what I believe GoDaddy intended it to be.
These individuals also said to me that the ad didn't influence whether they would purchase the service providers products or services. Why is that?
These younger individuals have grown up on shock advertising. Nothing is surprising them anymore. Whereas the 'baby boomer' generation didn't really have shock advertising come into their lives until the 90's. So shock advertising may still be 'shocking' to them.
Is this a generational 'thing?'
I remember well the Brooke Shields Calvin Klein ad in the mid '90's. Showcasing a very young girl in a sexually suggestive ad was deemed 'blasphemous' by some. What individuals saw as shocking in the 90's would not even phase most people today.
Shock advertising really began with the fashion industry, utilizing sexual connotations within their ads to get attention. Soon advertisers saw that shocking individuals garnered more attention leading other industries to follow, including Volvo with their controversial crash ads, to several charitable organizations utilizing shocking images of AIDS patients, starving children and abused animals to get attention and consequently more donations.
Now shock advertising is nearly everywhere from BuzzFeed's 'shocking' attention getting headlines for mundane articles, to pet related websites geared toward the younger generations utilizing teaser and shock headlines to garner more traffic.
This movement is one reason that Dog Fancy and Cat Fancy have made their way to the rainbow bridge when taken over by I-5 Publishing, and have now gone the way of the new Catster and Dogster (more on that in a later post).
But the real question is does shock advertising/marketing work? Does it sell more product and services?
Advertisers, marketers, professors, university students and the media have debated that question for years. And as far as I know there are no scientific studies to say that they work or don't work.
Here is my advice if you are thinking of utilizing a little shock advertising and marketing for your pet business:
The one and only thing to really consider is your brand. Do you want your brand to be shocking, controversial, and potentially risk a negative connotation? Some pet businesses do and utilize shock advertising. But if you want to have a well-respected, well made product, provide the ultimate in customer service and showcase your brand as such, then shock advertising is probably not for your business.
The current demographic that purchases the most pet products and services (baby boomers) likes warm and fuzzy, they like funny with 'taste,' they like cute. However that will change with the move to millennials and the Gen Y & Z generations. You will have to utilize more attention-getting advertising and marketing tactics to stand out from the crowd. Remember, they have seen a lot of 'shocking' things, much more at their age than baby boomers.
But the key will be how to garner their attention without creating a negative connotation to your brand. Creativity will be key.
For more information about how you can be more effective with your advertising and marketing, email us to schedule a time for a free 30 minutes consultation.
Journal of Advertising Research
Mediterranean Journal of Social Sciences
Photos courtesy of Leslie May (her Gracie is always shocked by something, usually a squirrel.)
Within just hours of this posting the online dog loving community took to social media in an uproar over the message of the new GoDaddy ad. If you didn't see the video you can see it below.
It's obvious that GoDaddy really missed the mark with this ad creating a media backlash that consequently gave them a lot of publicity. GoDaddy CEO Blake Irving said in a tweet today...
Thank you @animalrescuers for the candid feedback. What should have been a fun and funny ad clearly missed the mark and we will not air it. — Blake Irving (@Blakei) January 27, 2015
Two big questions: Was this stunt planned by GoDaddy and will this fiasco hurt their business or help it.
UPDATE 1-28-2015: In the shadow of the GoDaddy backlash, this morning A-B Budweiser released their new puppy themed Super Bowl commercial that will air during the Sunday broadcast.
Puppies sell, so it seems there will be no shortage of utilizing pets to sell products and services during the Super Bowl. GoDaddy, previously known for their risque ads featuring Danica Patrick, will be striving to appeal to a broader audience by featuring puppy, Buddy.
In December, GoDaddy held a social media contest to name the puppy, which was selected and announced the day the commercial was shot in December. The company officially named the puppy Buddy as the company's "chief companion officer" and has given Buddy his own office — with couch and doggy door — at the company's Scottsdale, Arizona headquarters.
According to USAToday, GoDaddy's chief marketing officer, Barb Rechterman, vows that the 30-second ad has a serious twist that goes well beyond a cute puppy finding its way home. "We know that puppies hit an emotional chord with people," says Rechterman. She also notes, "Puppies garner more news media coverage. And we want to get the spot watched."
But the end of the commercial will surprise you as GoDaddy targets small online businesses, and may strike a negative cord among dog lovers, rescue volunteers and the plethora of online dog lovers who consistently discourage individuals from selling/buying puppies online. Will the GoDaddy puppy commercial backfire?
Another prolific Super Bowl advertiser Anheuser-Busch, known for their consistent, adorable, 'tug at the heart strings' commercials featuring their Clydesdales and dogs, may strike a friendlier cord with dog lovers.
While the commercial hasn't been released, and won't be until the big event this Sunday, A-B has been offering teaser gifs and photos. The Budweiser ad, “Lost Dog,” will feature the world-famous Budweiser Clydesdales and their favorite companion. In the spot, the Budweiser Clydesdales will tell an emotional story and help a puppy who has lost his way learn the true meaning of friendship. "We've turned to animals in our ads because they help universalize our storytelling," says Brian Perkins, vice president, Budweiser. "To us, it's less about puppies specifically, and more about how the Budweiser Clydesdales and their friend, the puppy, help us tell a story around (the) quality (of) our beer."
Here is a small sneak peak:
Super Bowl ads in 2015 will cost approximately $4.5M for a 30-sec spot, up $500K from 2014.Google
On Friday, Facebook dropped a bit of a bombshell for Facebook Fan Page marketers when they announced that beginning in January 2015, people will see less organic promotional posts within their news feeds from Facebook fan pages that they have liked.
These posts will primarily be:
- Posts that solely push people to buy a product or install an app
- Posts that push people to enter promotions and sweepstakes with no real context
- Posts that reuse the exact same content from ads
Samples of these types of posts they cited include:
Facebook explained their reasoning for reducing the number of promotional posts from fan pages in an individuals news feed this way...'As part of an ongoing survey we asked hundreds of thousands of people how they feel about the content in their News Feeds. People told us they wanted to see more stories from friends and Pages they care about, and less promotional content.'
What does this mean for your pet business?
It means that increasingly Facebook is reducing how much of the content you post on your Facebook fan page in the news feeds of those that have liked your page; first with their algorithm changes in recent months, and now with this new change coming in January.
Without a big ad budget for Facebook advertising, it's clear to me that Facebook is becoming less and less a way to reach, engage, promote and market to your pet business current and prospective customers and am encouraging all of my clients to continue to work with their Facebook page, but to also begin strengthening their other social media outlets in the wake of this announcement.