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Pet Food and Pet Care Retailing - UK - October 2008

ISSUES IN THE MARKET
Main themes
Definitions
Abbreviations
INSIGHTS AND OPPORTUNITIES
MARKET IN BRIEF
Market staying strong
Robust pet ownership numbers
Definitely a family pet
Humanisation
A costly business
New laws on vet meds
Distribution
Influence of celebrities and the media
The future
FAST FORWARD TRENDS
 TREND 1: CORNER STORE
Definition
What next?
 TREND 2: SLOW IT ALL DOWN
Definition
What next?
 TREND 3: DECLINE OF DEFERENCE
Definition
What next?
INDUSTRY INSIGHTS
Key points
Market views
Quality opportunities
Lifestyle issues
Canine, feline or human?
Vital signs online
Specialism an absolute must
INTERNAL MARKET ENVIRONMENT
Key points
Pet ownership alters
Figure 1: Top pets in the UK, 2008
Figure 2: Top dog breeds in the UK, 2008
Figure 3: Population of dogs and cats and the number of households owning these animals, 2000-08
Figure 4: Trends in pet ownership, by type of animal, and pet insurance, 2002-08
There’s money in anthropomorphism
Porky pets
Love and attention but not disease prevention
Legislation change
BROADER MARKET ENVIRONMENT
Key points
The economy – a contradiction
Figure 5: PDI and consumer expenditure, at current and constant 2003 prices, 2003-13
Changing population dynamics change pet dynamics
Figure 6: UK population, by age, 2003-13
Figure 7: Trends in the number of children, by age, 2003-13
Household structure
Figure 8: Number of UK households, by number of persons in household, 2003-13
Working women
Figure 9: UK workforce and employment, by gender, 2003-13
Lifestyle changes
Figure 10: Percentage of adults booking UK and overseas holidays, 2003-07
Grocery trends
Media influence
MARKET IN CONTEXT
Key points
Pet products versus total retail sales
Figure 11: UK retail hand sales of pet food and petcare, 2003-07
Figure 12: Changing shares of main categories of spend, at current prices, 1997 and 2007
STRENGTHS AND WEAKNESSES IN THE MARKET
Strengths
Weaknesses
WHO’S INNOVATING?
Key points
Making pets at home
Making the most of medical rules
New format specialists
Product diversity creating niches and specialisms
Retailing beyond the grave
Growth in professional services
MARKET SIZE AND FORECAST
Key points
Robust sales throughout the market
Figure 13: Retail sales of pet food, pet accessories and healthcare, and pet insurance, at current and constant 2008 prices, 2003-13
Figure 14: Annual household spending on pets, 2001/02-2006
The future
Factors used in the forecast
SEGMENT PERFORMANCE
Key points
Pet food
Figure 15: Retail sales of pet food, at current and constant 2003 prices, 2003-08
Figure 16: Retail sales  of cat and dog food, at current prices, 2003-08
Pet healthcare and accessories
Figure 17: The market for pet healthcare and pet accessories, at current prices, 2003-08
Pet insurance
Figure 18: The value of the pet insurance market, by gross written premiums, 2003-08
PET OWNERSHIP AND BUYING PET PRODUCTS
Key points
 PET OWNERSHIP
Every dog has its day
Figure 19: Pet ownership, 2005 and 2008
Bringing out the nurturing instinct
Keeping it in the family
Money no object?
Multiple pet owners in a minority
Figure 20: Number of types of pet owned, August 2008
Figure 21: Pet ownership, by number of types of pet owned, August 2008
 WHERE CONSUMERS SHOP FOR PET FOOD
Supermarkets leading food source
Figure 22: Outlets used for buying pet food in the last month, 2005 and 2008
Pets at Home attracting new pet owners
Tesco not always first for food
Figure 23: Outlets used for buying pet food in the last month, by pet ownership, August 2008
Who is most loyal?
Figure 24: Number of suppliers used, by pet ownership, August 2008
One in five only buy at Tesco
Figure 25: Outlets used for buying pet food, by number of outlets used for pet food, August 2008
More pets = more specialist
Figure 26: Outlets used for buying pet food in the last month, by number of types of pet owned, August 2008
 WHERE CONSUMERS SHOP FOR PETCARE PRODUCTS
Specialists dominate in accessories
Figure 27: Outlets used for buying petcare products in the last 12 months, 2005 and 2008
A role for niche areas at specialists
Figure 28: Outlets used for buying petcare products in the last 12 months, by pet ownership, August 2008
Pet owners don’t always buy petcare
Figure 29: Number of petcare suppliers used, by pet ownership, August 2008
Loyalty to specialists for petcare
Figure 30: Outlets used for buying petcare products, by number of outlets used for petcare products, August 2008
SHOPPING BEHAVIOUR FOR PET PRODUCTS
Key points
Figure 31: Shopping behaviour when purchasing pet food and petcare products, August 2008
Creatures of habit
Presents for pets
Taking advice
Internet interest but not activity
Supermarkets could watch the birdie
Figure 32: Shopping behaviour when purchasing pet food and petcare products, by pet ownership, August 2008
Paying more is a luxury
Families want it to be good enough
Young people like to treat
ATTITUDES TOWARDS PET OWNERSHIP
Key points
One of the family
Figure 33: General attitudes towards pet ownership, August 2008
Figure 34: Attitudes towards pet ownership, by pet ownership, August 2008
Women are the biggest pet lovers
Keeping it in the family
Holidays become more of a problem
Regional differences
Pets get an emotional rescue
Figure 35: Where pet(s) acquired, reasons for getting and attitudes among pet owners, August 2008
Mum’s the word
It starts with the pet shop
No time for pets
Figure 36: Attitudes towards pet ownership by those without pet(s), August 2008
What’s stopping them?
 IDENTIFYING TARGETS
Figure 37: Pet shopping typologies, August 2008
Store-loyal, brand-loyal and ready to purchase for their dog
Pet Pamperers (21% of pet owners aged 15+)
Figure 38: Agreement with statement: ‘I sometimes see something for my pet and just have to buy it’, by typology, August 2008
Super-pampering stays niche
Figure 39: Agreement with statement: ‘I like to buy gifts for my pet’, by typology, August 2008
Brand- and store-loyal owners
Loyalists (38% of pet owners aged 15+)
Figure 40: Agreement with statement ‘I usually buy the same brand of pet food’, by typology, August 2008
Offer Seekers (41% of pet owners aged 15+)
Figure 41: Agreement with statement ‘I usually go for whatever pet food is on special offer’, by typology, August 2008
CHANNELS OF DISTRIBUTION
Key points
Industry bodies
Retailers
Specialist pet stores
Supermarkets
Garden centres
Other non-specialists
Pet food
Figure 42: UK retail sales of cat food, by type of outlet, by value, 2003-07
Figure 43: UK retail sales of dog food, by type of outlet, by value, 2003-07
Figure 44: Pet accessories (excluding cat litter), by value, by channel, 2003-07
Figure 45: Pet healthcare, by value, by channel, 2003-07
RETAIL COMPETITOR ANALYSIS
Key points
Figure 46: Petcare retailers, 2008
How are they faring?
Future prospects
RETAILER PROFILES
Outlet numbers
Figure 47: Pet retailers, number of outlets, 2002-08
 PET SPECIALISTS
Pets at Home
Strategic evaluation
Background
Financial performance
Figure 48: Pets at Home, financial performance, 2004-08
Store portfolio
Retail offering
Marketing and operational issues
E-commerce and home shopping
Recent developments
Jollyes Pet Centres
Strategic evaluation
Background
Financial performance
Figure 49: Leonard F Jollye (Brookmans Park) Ltd, financial performance, 2003-07
Store portfolio
Retail offering
Marketing and operational issues
E-commerce and home shopping
Recent developments
Pets Corner (UK) Ltd
Strategic evaluation
Background
Financial performance
Figure 50: Pets Corner, financial performance, 2004-07
Store portfolio
Retail offering
E-commerce and home shopping
Recent developments
Just for Pets (Wynnstay Group plc)
Strategic evaluation
Background
Financial performance
Figure 51: Wynnstay, financial performance, 2003-07
Retail offering
Marketing and operational issues
E-commerce and home shopping
Recent developments
PamPurredPets
Partners Pet Supermarkets
Big H Pet Superstore
 ONLINE PET SPECIALISTS
Pet-supermarket.co.uk
Strategic evaluation
Background
Financial performance
Retail offering
Marketing and operational issues
Recent developments
PetPlanet.co.uk Ltd
Strategic evaluation
Background
Retail offering
Marketing and operational issues
Petlife Online
Zoo Plus
Petmeds
Manufacturer-operated internet sites
 GARDEN CENTRES
Wyevale Garden Centres
Company overview
Petcare products offering
Recent developments
Dobbies Garden Centres (Tesco)
Company overview
Petcare products offering
Recent developments
Klondyke Group Ltd
Company overview
Petcare products offering
Recent developments
Notcutts Garden Centres
Company overview
Petcare products offering
Recent developments
 VETERINARY PRACTICES
 OTHER RETAILERS
Countrywide Farmers plc
Background
Financial performance
Store portfolio
Retail offering
E-commerce and home shopping
Recent developments
Argos
Company overview
Petcare products offering
Wilkinson
Company overview
Petcare products offering
Recent developments
Grocery multiples
Tesco
Company overview
Petcare products offering
Recent developments
Sainsbury’s
Company overview
Petcare products offering
Recent developments
Asda
Company overview
Petcare products offering
Recent developments
APPENDIX – PET OWNERSHIP AND BUYING PET PRODUCTS
Figure 52: Pet ownership, by detailed demographics, August 2008
Figure 53: Outlets used for buying pet food in the last month, by detailed demographics, August 2008
Figure 54: Outlets used for buying petcare products in the last 12 months, by detailed demographics, August 2008
Figure 55: Outlets used for buying petcare products in the last 12 months, by number of pets owned, August 2008
APPENDIX – SHOPPING BEHAVIOUR FOR PET PRODUCTS
Figure 56: Shopping behaviour when purchasing pet food and petcare products, by detailed demographics, August 2008
Figure 57: Shopping behaviour when purchasing pet food and petcare products, by detailed demographics, August 2008
Figure 58: Shopping behaviour when buying pet products, by number of types of pet owned, August 2008
APPENDIX – ATTITUDES TOWARDS PET OWNERSHIP
Figure 59: Attitudes towards pet ownership, by detailed demographics, August 2008
Figure 60: Where pet(s) acquired, reasons for getting and attitudes among pet owners, by detailed demographics, August 2008
Figure 61: Attitudes among pet owners, by detailed demographics, August 2008
Figure 62: Attitudes among non-pet owners, by detailed demographics, August 2008
Figure 63: Attitudes among non-pet owners, by detailed demographics, August 2008
Figure 64: Shopping behaviour when purchasing pet food and petcare products, by consumer typology, August 2008
Figure 65: Type of pet owned, by consumer typology, August 2008
Figure 66: Outlets used for purchasing pet food in the last month, by consumer typology, August 2008
Figure 67: Outlets used for purchasing petcare products in the last 12 months, by consumer typology, August 2008
Figure 68: Attitudes towards pet ownership, by consumer typology, August 2008
Figure 69: Consumer typologies, by detailed demographics, August 2008

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