In 2022, China's urban dog and cat consumption market reached 270.6 billion yuan, up 8.7 % year on year, but the growth rate decreased by 21.2 % year

In 2022, China's urban dog and cat consumption market reached 270.6 billion yuan, up 8.7 %?year on year, but the growth rate decreased by 21.2 %?year on year

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Paidu, a Chinese pet market data platform, recently released a White paper on China's pet industry -- a Report on China's Pet Consumption in 2022. The summary is as follows:

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1. Insight into the development of China's pet market: the market size continues to grow, but the growth rate slows down

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In 2022, the consumption market size of urban dogs and cats was 270.6 billion yuan, an increase of 8.7% compared with 2021, and a significant decrease compared with 21.2% in 2021. Among them, the growth rate of dog consumption market slowed down to 3.1% compared with 2021, while the growth rate of cat market was 16.1% compared with 2021.

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Under the covid?situation, the "cat economy" has given the pet industry a momentum of steady growth. In 2023, when the covid?situation is over, when the "going out economy" returns to normal again, the development of the dog economy can not be underestimated.

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Dogs and cats remain the most popular types of pets among pet owners in 2022. The number of dogs and cats in urban areas reached 116.55 million, an increase of 3.7 %?over 2021. Among them, the number of dogs was 51.19 million, accounting for 51.3%, which decreased by 5.7% compared with 2021, falling back to the level of 2020. While the number of cats was 65.36 million, accounting for 60.7% of the total, showing a continuous rising trend and a 12.6% increase from 2021, reaching a new high.

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In 2022, the average annual consumption of each?single dog was 2,882 yuan, an increase of 9.4% compared with 2021; The average annual consumption of a single cat was 1,883 yuan, an increase of 3.1% over 2021.

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Food, as a rigid product needed by pets, is still the main consumption market of pets. Among them, the penetration rates of snacks and nutrition products have increased significantly, accounting for 84.7% and 66.1% respectively.

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By category, the dog food market share was?48.5%, a continuous decline from 2021. Staple grains decreased by 0.8 %, snacks decreased by 1.0 %, and the share of nutrition products was stable, up by 0.3 %?from the previous year. Cats' share of the food market was 53.4%, down 0.5 %?from 2021. The market share of staple food and snacks decreased slightly, while the market share of nutrition products increased slightly.

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In terms of pet medicine, the medical market share of dogs was 29.0 %, down 0.8 %?from 2021, with diagnosis and treatment down 1.6 %?and medicine up 0.7 %. Cat medical market share was 29.2%, up 0.6 %?from 2021.

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2. Pet owners' insight: the proportion of high-consumption pet owners has fallen

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In 2022, pet owners was?further younger, with the post-1995 generation taking the dominant position, accounting for 36.8%. Compared with 2021, the proportion of pet?owners?born in the 1980s decreased by 10.2 %. The share of pet?owners?born in the 1970s rebounded, rising 0.5 %.

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In 2022, 52.0?%?of?pet owners?had kept their pets for three years, 20.5%?had kept their pets for one year, and 31.5 %?had kept them for one to three years. Among pet owners born after 1995, 29.7 %?of them have kept their pets for one year.

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The proportion of high-consumption pet owners decreased somewhat, accounting for 23.1%, down by 1.9 %?year-on-year. High-consumption pet owners accounted for 25.9%, down 2.9 %?year-on-year. The proportion of people with high consumption of cats accounted for 20.7%, which has been declining since 2019.

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Economically developed cities and regional central cities have a relatively high proportion of pet owners. Among the TOP10 cities in terms of pet owners, 8 cities ranked among the top 10 in terms of GDP in the first half of 2022. Among the TOP10 cities for dog owners, 13.5% are in Beijing. Shanghai followed with 6.3 %. Among the TOP10 cities with cat owners, Guangzhou has a relatively high proportion of cat owners, accounting for 9.5%; Beijing followed with 8.4 %.

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3. Insight into pet food consumption: emerging categories are rising, and e-commerce channels are still the mainstream

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In the dog staple food market, puffed food and frozen dry food are the main food purchased by dog owners, with a penetration rate of over 40%. Compared with 2021, the permeability of frozen and dry food increased significantly. In the staple food market, "frozen dry food" has overtaken "puffed food" to become the most preferred food category for cat owners. Compared with 2021, cat owners pay more attention to the nutrition of staple food, and the penetration rate of "frozen dry food" and "baked food" has increased significantly. Among them, "frozen dry food" has overtaken "puffed food", accounting for 47.1% of the market, and becoming the main food type for cat owners to buy.

In terms of channels: comprehensive e-commerce platforms are still the preferred channel for pet owners, with a low preference for emerging live-streaming brands and a high preference for offline pet shops. For example, ?more than 80% of pet owners choose online channels to buy staple food. Among online channels, large comprehensive e-commerce platforms have a clear advantage in preference. Among them, pet owners' preference for "Tmall/Taobao" has been nearly 90 %, "JD.com" nearly 50%. The use rate of emerging live streaming platforms is relatively low, accounting for only 9.8%. Among the offline channels, pet shops have a high preference rate of nearly 30%.

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In terms of brands: Foreign brands still dominate the dog staple food market, while the preference of Chinese brands in the cat staple food market increased slightly, and Chinese brands in the snack and nutrition market surpassed. In the staple food sector, dog owners prefer "foreign brands", while cat owners increasingly prefer "Chinese brands". Among dog owners: 48.7% have no clear brand preference, and only 19.7% buy Chinese brands, which was lower than 2021. Among cat owners: more than 50% of cat owners do not have a clear brand preference. The number of cat owners who buy foreign brands decreases significantly, while the number of cat owners who buy Chinese brands increases slightly. In the field of snacks and nutrition products, among the Top20 brands in terms of usage rate, Chinese brands have surpassed and occupied a dominant position.

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In terms of decision making factors: pet owners' concerns are more focused when purchasing main food and snacks, while nutritional products are relatively more dispersed than in previous years. In the main food market, for example, consumer decision factors are relatively stable, but the focus factors are more concentrated. Nutritional ratio", "ingredient composition" and "palatability" are still the most important decision factors for pet owners, with "nutritional ratio" and "ingredient composition" being the most important factors. The "nutrition ratio" and "ingredient composition"?increased?significantly compared to 2021.

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4. Consumption insight of small pet industry: consumer goods category is close to that of dogs and cats, and pet owners are getting younger

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The majority of people who keep small pets are mainly post-95 pet owners, accounting for 33,7%; followed by post-80s pet owners, accounting for 24.1%. The majority of pet owners have a Bachelor's degree, accounting for 52.2%, followed by college, accounting for 27.0%. Small pet owners mainly live in second-tier cities, accounting for 46.0%. Income is mainly middle income (monthly income of RMB 4,000-9,999), and married families with children are the main pet owners, followed by single/unmarried people.

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In the small pet market, food as a pet demand product, the penetration rate is relatively high, but there is still a large room for growth. The second is supplies. Different types of pets have different demands for supplies. The demand rate of rodent products is higher, accounting for 71.3%.

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Pet owners who keep small pets have scattered consumption pain points. There are problems with commodities, medical care, behaviour, feeding and small pet purchases, all accounting for more than 20% of the total.

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Pet owners of different pet types have different consumption pain points. For rodent pet owners, the main pain point is that there are fewer hospitals, for reptile pet owners, the biggest pain point is "not understanding the behavior of pets", for aquarium pet owners, the biggest pain point is "uneven quality of pet products", and for birds, "expensive medical treatment ".