Think four-legged friends and you’d probably think cats and dogs, but you should think again. That’s because more and more families are switching to hamsters, rabbits and guinea pigs as pets.
Supreme Petfoods marketing director Ann Tenison explains: “The small animal pet food and accessories market is growing at an exceptional rate. The increase in urban living, coupled with the fact that people are becoming more time poor, has meant that small animals have grown in popularity. Depending on the small animal, they can require less space and are not so much of a commitment as a dog.
The day-to-day cost of feeding and looking after a small animal can also be significantly lower than a dog or cat.
“Rabbits and guinea pigs remain the most popular pets kept outdoors, however there is an increasing number of rabbits being kept indoors as ‘house rabbits’. And hamsters are the number one choice for a small pet in the home.”
Many c-stores’ pet food shelves fail to offer small mammal feed, but Tenison argues that they should: “With the rapid rise in small animals being kept as pets retailers really need to rethink their range. Space should not really be an issue as small animal food comes in small, easy-to-stock bags. In addition, the food has an extensive shelf life - for example, our rabbit food has a shelf life of 15 months.”
Supreme Petfoods produces Russel Rabbit, Gerty Guinea Pig and Harry Hamster products for small animals. Products come in bright packaging and Supreme provides extensive pos material to ensure shelf standout. The range is available through wholesale and cash and carry channels. The 1kg size bags are sold in cases of 10 but Tenison says some distributors break down the cases to sell in single units. When sold at the suggested retail price, she says retailers get an average margin of 35%.
Last year Supreme scored a first for a small animal pet food brand when it ran an on-pack promotion that tied in with the Wallace & Gromit film, The Curse of the Were-Rabbit. Says Tenison: “Pet food companies are having to differentiate and add value to their brands in the same way that grocery products have, which is why we ran the promotion.”
Such differentiation for Supreme also means offering health benefits, as with its Science range of small pet feeds. The Science Selective Rabbit food, for example, is an extruded biscuit that’s designed to encourage rabbits to chew in a way that will help avoid dental problems. It’s high in fibre and contains no sweeteners.
Another company that offers small animal feed is Pascoes. Its Guinea Pig Goodness, Hamster Health and Bunny Balance products each claims different health benefits - Hamster Health provides plenty of fibre to encourage chewing, and smooth kibble to ensure the cheek pouches are protected. This all might sound a little over the top but pet owners really do want to keep their pets in the best of health - particularly as vets’ fees can be so high.
In its recent pet care report, Mintel talks about the increasing ‘humanisation’ of pets, where animals are treated more like one of the family. This has led to owners buying products that claim to benefit pets’ fur and other body conditions in the same way that they buy products for their own well-being. This ‘humanisation’ of pets has even resulted in the arrival of a new pet being marketed to in the same way as a new baby. On their first visit to the vet, for instance, a new dog owner receives a puppy pack, just like the new baby Bounty packs given to mothers in hospitals.
Leading pet food player Masterfoods has identified owners’ awareness of pets’ needs as having great sales potential. The company reckons this is particularly true when it comes to lifestages, with more and more owners buying into products that cater for kittens, then adult cats, then senior cats. And when you realise that 500,000 kittens are born in the UK every year and 49% of cats are classed as ‘seniors’, you can see the potential.
More opportunity also comes from the fact that consumers increasingly view their pets as ‘one of the family’, which has led to a growing demand for super-premium products. Nestlé Purina’s Gourmet brand is performing particularly well in this sector. The company’s customer development director Andrew Harding comments: “Convenience retailers need to make sure they trade up their pet food offering so shoppers can buy these premium lines in their stores as well as in the supermarkets.”
Harding says pet food should be treated as a major category within the convenience sector as consumers buy it on average 36 times a year, or approximately every 10 days. “This means there is increased footfall opportunity from having a well-stocked pet food range that offers the leading brands.
“Increasing disposable incomes have had a massive influence on customer purchases with many switching to higher priced convenient products which offer ease of use and strong lifestage and health benefits.”
In wet cat food, the switch has been from cans to single-serve sachets. Says Harding: “Shoppers are used to buying multipacks of these sachets in supermarkets, so when they do their top-up shop in c-stores, multipacks are a popular choice as it tides them over for a few days - after all, one cat eats three pouches a day.”
Interestingly, Harding also identifies an opportunity for impulse purchases of pet food. “Treats are a major driver of market growth,” he says.
EASY DOES IT
Getting the right pet food range needn’t be a problem with Masterfoods’ Easy 4 You. It’s an initiative that’s designed to take all the hassle out of selecting pet products by bringing together the right range in an easy-to-use fixture, specially designed for retailers with limited shelf space.
The idea began in 2004 when a range was tested in 500 Costcutter stores. Costcutter trading director Angela Barber explains: “Being involved with the project had an incredible impact on sales. By making simple changes such as trading up from single cans or pouches to multipacks, and stocking snacks and treats, we experienced 89% growth in profitability.”
Easy 4 You aims to represent the optimum range of products for a half-metre fixture. The 19 ‘essential’ products can be found in a separate Easy 4 You section in cash and carry depots. For retailers with more space for pet food, Easy 4 You represents a ‘starter’ range, to which other products can be added.
Some 40% of convenience shoppers own a pet, yet six out of 10 shoppers never buy pet food in convenience stores. Nestlé Purina offers these tips to help the pet food shelves stand out:
Give pet food a priority position in the store and use clear shelf-edge labels to make identifying products as easy as possible
Use POS material to highlight new products and promotions
Separate cat and dog items, making sure that different types of pet food are well segmented
Stock the best-selling ranges across cat and dog
Concentrate on stocking brand leaders and ensure that you have enough shelf space for the fastest-selling products
Ensure products are well stocked - consumers are brand loyal and won’t hesitate to shop elsewhere if their preferred product isn’t available
Place premium products at an easy-to-reach level
Place larger packs like complete dog foods on the bottom shelves.
The percentage of households with a pet has fallen from 54% in 1999 to 48% today
Changing lifestyles mean fewer people are willing to commit themselves to pet ownership, particularly to owning larger animals with longer lifespans such as dogs. As a result, cats, rabbits and fish becoming more popular
Between 1998 and 2004, the pet food and petcare market increased by 30% to reach an estimated £3.8bn. Pet food accounts for 51% of the market
The market growth was achieved despite a reduction in the ownership of some pets, indicating an element of trading up to premium foods, rising vet and healthcare costs and the greater availability and purchase of accessories
There are no indications that declining pet ownership is related to consumers not liking animals in their home or that they are considered too expensive to keep
Specialist pet shops are still the leading distribution channels for pet accessories and healthcare but grocery stores dominate when it comes to pet food and cat litter
Tesco has the largest percentage of consumers using it to buy pet food. Some 29% of consumers use Tesco for pet food with pet shops being the next most popular source, with 27%.
Source: Mintel’s Pet Food and Pet Care Retailing report, May 2005
Christian Whitfield, who has two c-stores on the outskirts of Bristol, believes retailers should check out local and regional suppliers for profitable volume sellers. He did this and now sells a range of Mr Ben’s Pet Supplies. “We were looking for small mammal feed, for rabbits, guinea pigs and hamsters, and treats for cats and dogs. I saw the Mr Ben’s range in another shop and decided to give it a try. Now we stock a range of its best sellers. Our best seller is pigs’ ears - we sell 10-12 units week and each unit comprises two ears.
“Mr Ben’s offers us a range that dovetails nicely with our branded range. It’s never going to be a huge volume seller but does okay. The Mr Ben’s range has turned pet food into a basket-builder for us. It brings in new shoppers plus converts occasional shoppers into regulars.”
Christian’s best-selling pet food by far comes from Masterfoods - Chum for dogs and Whiskas for cats. “Over the past 12 months we’ve noticed a decline in sales of Felix; I don’t know why, perhaps it’s because its black and white cat ads have not been on TV much. Tertiary brands don’t work for us in cat food but they do in dog, where we sell a lot of pricemarked Bounce.”