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The U.S. pet industry continued its strong run in 2021, growing 14% overall to $123 billion, according to a new report from market research firm Packaged Facts. As one facet of those gains, non-medical services such as grooming and boarding — the only pet industry sector to lose ground in 2020 — rebounded almost entirely in 2021, according to the US Companion Animals Market Outlook 2022-23 report.
A number of factors contributed to the impressive performance, said report analyst David Lummis, including “an increased focus on pet health and welfare among owners of pets in close contact with their pets, an increased reliance on digital pet care, including online shopping, and the impressive adaptability of consumers, merchants, retailers and service providers.”
Throughout 2021 and into 2022, the pet industry has seen a record pace of M&A deals as well-established participants carve out more “omnimarket” stakes and international territory and outside investors flock to the fold. Packaged Facts coined the term omnimarket (rather than retail-rooted “omnichannel” to characterize the much broader competitive trend that has reshaped the pet industry over the past two decades, with strategic border crossings and aggressive between brick and mortar and e-tail, pet specialty and mass, products and services, medical and non-medical, and food supplies versus non-food pet supplies, officials said. One tie that binds these business operations overhauls has been companion animal health as the basis for innovation and differentiation, and doubly so in this era of COVID-19, officials said.
All sectors of the pet industry will continue to benefit from this ever-broader focus on pet health and welfare, which provides a solid framework for continued premiumization in areas ranging from alternative forms of pet food and types of pet treats to pet product autoship/subscription programs. , to compound pet medications, to custom dog grooming services, officials said. Additionally, in the wake of the COVID-19 pandemic, Packaged Facts expects marketing to increasingly focus on the mental health benefits of “pet-sitting,” in accordance with this trend in consumer markets.
RELATED: Why We Expect a Slew of New Pet Industry M&As in 2022
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