In developed countries, the pet industry has developed for more than 100 years, formed a relatively mature market including pet supplies, pet food, pet raising, pet medical care, pet training, pet insurance and other services. Thus, the pet market in developed countries has become an important part of their national economy. According to Euromonitor, the global pet market reached nearly $120 billion in 2017 and is growing at around 3.5% a year. In detail, pet food industry is an important economic pillar of the pet economy, with the characteristics of large demand, high frequency and desirable repurchase rate. The global pet food market was expected to be around $102.9 billion in 2021, growing at the rate of 6.17% since 2012, according to Statista. First, the pet food industry revealed a trend of diversified and personalized development, whereas food staples, snacks and health products have been divided into different market segments. Second, technological progress stimulates consumers put forward higher requirements for pet food safety, and the high-end market of pet food keeps expanding. Third, since the brand concentration of pet food is low, the new brand company could gain seed round investment or pre-A round of financing from investment institutions. However, it is a thorny problem for pet food enterprises to expand their profit scale, and many leading enterprises have fallen into the dilemma of sharp decline in net profit. As for the reasons, besides the rising price of raw materials and frequent incidents of pet food safety, the increasing operating costs caused by the fierce market competition are also taken into account.

On one hand, pet medical care is a rigid demand, with the characteristics of strong professionalism, high technical barriers, service dominance and discourse power. According to authoritative statistics, the revenue of pet diagnosis and treatment, pet medicine and pet vaccine accounted for 95%, 4% and 1% respectively. On the other hand, the pet medical market is highly profitable, which is reflected in the ultra-high gross profit rate of pet medical enterprises. In 2020, Rip Bio, which focuses on the field of veterinary drugs, achieved a net profit of 398 million yuan, with a year-on-year growth of 104% and a compound growth of 31% in the past five years. Generally speaking, traditional pet medical chain brands take advantages of the number of stores, and firmly occupy the offline market share. In addition, there are a growing number of businesses improve the service efficiency of enterprises and promote the digital transformation of the industry by building online HIS system or SAAS system. With the rapid development of the pet medical market, the shortcomings of the lack of strict policy supervision are gradually exposed, and the problems such as arbitrary charges are also gradually revealed. Thus, the relevant departments issued a number of pet medical related norms and policies to alleviate the occurrence of industry chaos. 

In terms of other market segments, the pet funeral market shows an explosive growth trend, and the implementation of pet funeral market is because of both emotional and practical factors. First of all, it is difficult to dispose of pet remains in the city, and cremation is the best option. Secondly, pet funeral franchise stores operate with lower costs and higher profits, so entrepreneurs are more interested in them. Moreover, pet funeral meets the emotional requirements of consumers since owners are very reluctant to face the death of pets. However, the service level of the pet funeral industry is seriously differentiated and the user evaluation of performance needs to be improved. If standardized and industry regulations are established in the future, the pet funeral market will further expand.

The Impact of COVID-19 on Pet Adoption

Since the COVID-19 outbreak, people have been socializing less and spending more time at home. Therefore, there were an increasing number of people choosing to buy or adopt a pet in order to obtain companionship in their home life and relieve the stress and anxiety caused by COVID-19. Statistics show that more than 3.2 million stray animals were adopted during home confinement in the United Kingdom.

As the world’s largest pet consumer market, the pet ownership rate in the United States is as high as 70 percent, implying that about 90.5 million households have pets. According to a survey, 80 percent of Americans claimed that their pets have helped them through the tough times of COVID-19. Thus, pets are not only their emotional sustenance but also their important family members.

The growing number of pets has also led to a rise in pet-related spending. Since 2002, the size of the pet market in the United States has maintained a continuous positive growth. Even in the face of the economic crisis in 2008 and the outbreak of COVID-19 in 2020, the growth rate has not slowed down, which also reflects the high growth of the pet market and the property of anti-economic cycle.

The Unethical Behavior of Abandoning Pets and Prevention Measures

However, as people became less restricted to travel, the animals once treated with tenderness were becoming a new concern for many people, resulting in a wave of pet abandonment. It is worth mentioning that the website of a dog charity in the United Kingdom is full of thoughts and comments about getting rid of pets. From February to June last year, the number of people who visited the site to abandon the dog module rose 180 percent. When directors of this organization first saw the adoption and buying boom, they thought about the possibility that unprepared adopters and buyers would end up abandoned, but it was unexpected that they would face such an unprecedented crisis in the post-pandemic era.

Actually, people who suffer from isolation and loneliness did not realize the responsibility to buy and adopt a pet. As they return to their old work and life routines, a plenty of owners find they no longer have the time and energy to spend with their loyal companions.  And, as pets get older, owners start to realize how difficult it is to care for a pet.

What’s more, some people give up their pets for financial reasons. There was a similar wave of pet abandonment during the 2008 economic crisis. The impact of COVID-19 on the global economy is significant, and many people have lost their jobs during the pandemic. One shelter worker stated that many people return adopted pets because they cannot afford to keep them.  However, at any time, abandonment is a disgrace and should be punished by the authorities.

In order to prevent further abandoned cases, we should take advantages of regulatory measures such as laws to formulate and improve the pet ownership rules. The pets raising process management in Japan is worth learning, because the local government has made the detailed provisions, from pet registration (including the usage, quantity, type), the vaccine in the process of breeding, feeding, to the pet’s death. And owners should take the responsibility under strict supervision so that each pet has good end-result. Also, it is recommended to increase penalties and raise abandonment costs. In many countries, the barriers to getting a pet are low and there is little cost to getting rid of it. But in Japan, owners face a fine of up to 300,000 yen if they abuse or abandon their animals. In Germany, owners who abandon their dogs would be fined up to 90,000 euros or, in serious cases, face jail. Moreover, heavy punishment is not the only way to reduce abandonment, hence the unethical behavior could be linked with personal credit information system to improve owners’ credit awareness and reduce abandonment behavior. Finally, it is a long-term systematic project to improve the public’s literacy of pet raising, which cannot be accomplished overnight.

By Xin Wang