The global market for pet foods is projected to reach $95.7 billion by the year 2017, according to a new report from Global Industry Analysts, Inc. (GIA), with macro regional economic conditions, pet population, and most importantly, consumer attitude driving the market.

Due to changing lifestyles and increase in “alone or single-person family” and decreasing birthrate, pets are being considered as family members and companions rather than just animals. Factors such as attitudinal change toward pets combined with growing urbanization, and increase in disposable incomes have contributed significantly to the increase in number of households owning pets, which in turn, drives the demand for pet foods.

The pet food industry witnessed a significant increase in size in the last few years, with the market structure evolving as per the current requirements of the dynamic industry. In addition, pet foods represent one of the fastest growing sectors in the food industry. The industry has been growing on account of increased market segmentation and producer innovation. Numerous factors such as increased popularity of organic pet food, and greater interest in nutrition and health of pets are driving the pet foods market.

Private label cat and dog food brands are increasingly being used in developing markets. There is also a growing preference for adoption of smaller pets in some parts of the world, as they are considered economical and require relatively less maintenance vis-à-vis larger dogs and cats. The rise in popularity of small pets has resulted in a considerable growth in the small animal food market.

The humanization trend in mature markets is stimulating demand for value-added products, such as functional pet foods and nutraceuticals. Research & Development is also anticipated to drive the market with innovative products incorporating advanced formulations. Other market propelling factors include brand value enhancement in major developed markets as well as improved delivery and supply services, aimed at consolidation of multiple grocery retailers. Against this backdrop, future for pet foods appears robust, with demand for healthy and premium-end foods for pets providing the needed impetus.

As stated by the new market research report on Pet Foods, Europe continues to remain the largest regional market. The European market is primarily driven by mounting focus on health-oriented products, especially those meant for different ages and types of pets and pet treats. Asia-Pacific represents the fastest growing regional market displaying a CAGR of about 9% over the analysis period. In developing markets, including Vietnam, India and China, product pricing, value for money and cost factor represents prime criteria for the purchase and demand of pet foods. In the relatively affluent and developed markets such as Singapore, South Korea and Japan, growth drivers include innovation, shorter product lifecycles, healthier products and convenience. In Japan, the pet food market is witnessing change in terms of food supplements as pet food makers renew focus toward development of new products to meet the needs of increasing older pet population.

Dog Food continues to be the largest and the fastest growing segment. The present market for dog food also comprises health stage specific food; prescription food; breed specific food as well as holistic and natural food. Cat food is particularly formulated for consumption and usage by cats, looking into their specific nutritional and health requirements. Cats are obligate carnivores and majority of the commercially prepared cat food comprises supplementary nutrients such as amino acid derivative taurine.

Retail grocery chains dominate the distribution and marketing space. Smaller specialists and pet superstores also hold a moderate share, with the remainder accounted for by independent grocers. Principal trends affecting the distribution of cat and dog foods include emergence of the new veterinarian/clinic distribution format, waning role of pet shops, and rise of hypermarkets and supermarkets. Due to an uncertain global economy, there is a considerable emphasis on purchase decision in terms of selection of retail store for buying pet food. The year 2010 experienced a decline in number of new product introductions as retailers concentrated more on value products and private labels. However, with economy showing signs of revival post recession, leading companies are gearing up with new product launches.

Primarily, two types of player categories essentially drive the cat and dog food categories in the pet food industry. One comprises of specialty firms producing pet food exclusively meant for addressing health related or other specialty pet food requirements. The other market structure is made up of players focusing on large-scale food manufacturing.

The research report titled “Pet Foods: A Global Strategic Business Report” announced by Global Industry Analysts, Inc., provides a comprehensive review of trends, issues, strategic industry activities, and profiles of major companies worldwide.