What’s Trending: Man’s best friend will always be man’s best friend and the ongoing pandemic accelerated the willingness to spend on his furry friend. The growth keeps climbing with no signs of slowing.

Over the last quarter century, the industry has not seen a single year of negative growth. Pet lovers don’t see their spending as optional — making for a recession-proof market.  “Animal humanization” has caused funding to soar:

• $65m VC raised in the first 3 months of 2021 ($61m of this in the US)
• Surveyed owners saying “pets are family”: 90% in 2019 to 95% in 2020 
• Pet insurance: US market leader Trupanion’s revenue grew 31% YoY to reach $502m in 2020, and UK-based Bought by Many raised $350m this June
• Shelter pet adoptions, boosted by the pandemic, continued to surge this year (notably, with a ~25% lower return rate. We’re not crying, you are)

 

The Opportunity: There are plenty of new opportunities to capitalize on this ever-growing industry. Here are three to chew on:

High-End Food

Nowhere is the humanization of pets more pronounced than in the food segment. The era of dry kibble is over; enter human-testedpet meals (and you thought lavender macaronswere just for your afternoon tea).

The fresh pet food market is expected to reach $1.1B+ by 2026. Demand is particularly high in the US and Australia. Current US market leader The Farmer’s Dog has 1.5m+ site visits/month.

And there is still time for more to enter the space and compete with fresh, personalized food options. Raw dog food is a high-growth niche. Mirroring human food trends will be another profitable approach.

Entrepreneurs could also focus on treats and special occasions. Per Google Trends, searches for “cake for dogs near me” hit an all-time high this June — a 450%+ increase from just a year ago (no, our dog did not write this).

Pet Wearables

The market for pet wearables is forecast to reach $1.7Bwithin the next 3 years, at a 19.6% CAGR.

Source: MarketsandMarkets

Owners’ desire to monitor their precious pooches while away is driving demand for connected smart collars and harnesses that track everything from location to emotional state.

Entrepreneurs could focus on personalized gear, user-friendly apps, data analysis, or connected ranges (wearables that link to smart food and water bowls, pet doors, treat dispensers, etc.). Manufacture/sourcing of required tech components such as sensors is another option.

Niching down to develop wearables for the growing number of exotic pets is also an attractive route, as are rental options for pet tech (that will come with a high price tag).

Doggy Day Care

Google search interest for doggy day care centers hit an all-time high in 2H 2021.

 

Someone please let the dogs back in. Source: Google Trends

Enrolling Fido in day care can cost $240-$550/month (excluding overnight boarding and weekend stays).

Demand will soar as owners trickle back into the office post-pandemic. 

People looking for at-home pet services are also rising: Dog boarding and walking app Rover had 100k downloads last month, hot off a February announcement about plans to go public.

Next Steps:

If you haven’t already thought about this exploding sub-category in pet healthcare, it is certainly something to pounce on now.  

Prospect smAARt, pitch with purpose, and most importantly, with passion.