Rapid urbanization, nuclear family set-ups, and pet humanization in recent years have been instrumental factors in the boom of pet ownership across the world. India is globally noted to be an active contributor to this league and portrays a promising pet population of 32 million, which is growing at a rate of more than 12 percent annually. This increasing pet ownership is giving the desired impetus to the pet-care ecosystem entailing retail chains, pet nutrition, and services along with pet care services.
Even against such promising figures, the pet care industry in India is in its nascent stage. But with Gen Z riding this new wave of pet parenting, there is an increased and informed demand for pet products, ranging from packaged goods to pet treats, branded toys, and accessories giving rising consumer awareness. Additionally, the urban and affluent millennials and the DINK population also form a considerable part of this consumer base. They show a strong tendency for staying aware and choosing the best for their pets. Consequently showing a remarkable rise in multi-brand retail outlets in recent years.
Also, it is estimated that the minimum basic spending to raise a pet, accounts for Rs 1,000 per month creating an opportunity size of more than $5 billion where the organized market makes up for less than 20 percent of the total opportunity size. Gauging this large gap, investors are moving ahead with alacrity to tap this unrealized market i.e the scope of growth in the organized segment. The market promises opportunities that go beyond pet products. Considering that urban pet parents lookout for quality content, community, and education to enhance their pets’ lives; there will be a rise in demand for expert services, consultation facilities, quality training, grooming, etc. forming an ancillary market for the sector.
In line with this, pet healthcare and nutrition will be the primary factors augmenting the growth of the market. Out of the total pet care industry, the food products are estimated at approximately Rs 8,000 crore annually which makes up half of India’s pet care industry. Though food makes up a generous share of the market, it is a paradoxical effect that the packaged food penetration in India is less than 7 percent compared to the upward of 70 percent penetration in the US and Europe. But the trends of growing income, rapid urbanization, and rise in health awareness, cumulatively are leading to the promotion of good health in pets. As a result, a paradigm shift has been noticed amongst pet owners moving towards premium and natural foods, unadulterated from any form of genetically modified organisms, artificial flavors, and colors.
The pet food industry analysis estimated that around $300 (accounting for approximately Rs 23,000) is spent per annum on pet food and treats by Indian pet owners. Accordingly, it has been forecasted that the Indian pet food market will be registering a CAGR of 13.5 percent between the period 2021-2026. Going by these statistics, the gap in the packaged food penetration can be bridged in the next 5-10 years when a large organized market is bound to come into existence. Tapping on to this, many companies are emerging as industry players offering food enriched with high-quality proteins and vitamins aimed at maintaining the overall health of pets from their skin to digestive health, allergies, and many more.
The huge gap between the Indian and Western pet care industries opens up the scope of intensive reformations that need to be devised and implemented to narrow down the existing gap. For instance, the average lifespan of a dog in western countries is 25-30 percent more than that of an Indian dog. This is because India only has 100-120 pet food brands as compared to more than 700 brands in the west accompanied by evolved markets. Likewise, healthcare also falls short with India having 6,000 pet households per vet against 1,500 households per vet in the US. While countries like the US and Singapore have specific dog training mandated by the law and regularized registration of pets with the law authorities. India, on the other hand, doesn’t allow pets in various public spaces like malls, parks, and at times even areas inside a gated community. Another aspect to counter in the Indian pet care space is the absence of a separate regulation for pets, it is currently covered under the broader livestock regulation.
To bring about considerable pet-friendly reformations in the sector, a robust framework will be required to educate the pet parents to improve the pet care environment in the country. As a result, more commerce will be happening in the space beyond the primary food market. Consequently, more brands will emerge in the Indian pet care market leading to the regulation following suit and aiding the growth of this under-served category helping India become a far more pet-friendly country than the current state.
Also dwelling on the rate at which digitization is happening around and the nativity of the new pet parents on the tech front, there is immense opportunity for the proliferation of e-commerce in the segment. Even the online pet food sales statistics indicated that about 73 percent of pet owners prefer purchasing food online while the purchase from pet specialty stores stands at 27 percent.
The pet care industry’s landscape looks impressive considering the positive effects of the discussed points above and the rise of digitally native pet parents. Being part of such a dynamic stage of a market, there is a lot of scope for the steep growth of an otherwise unrecognized pet care industry.