Product safety and alternative petfoods report released
The latest report released by Packaged Facts traces the government, industry and consumer responses to the petfood recall crisis
The latest report released by Packaged Facts, Product Safety and Alternative Pet Foods: North American Market Outlook, traces the government, industry and consumer responses to the pet food recall crisis, all the while keeping an eye on implications for North American sales of alternative petfoods. This report examines the impact of the petfood recall crisis of 2007 on the North American market in terms of consumer trust in pet food safety, production, marketing and new pet food trends.
As a particular focus, it explores the premise that the recall has positive implications for certain types of pet food that may be purchased or prepared as alternatives to traditional mass produced foods, and that the repercussions of the crisis—especially heightened food safety concerns among consumers—will affect the North American pet food market in ways advantageous to these alternative product types.
Based on information from various sources, Packaged Facts believes that billions of dollars in pet food brand sales are currently up for grabs as a result of the recall and its ongoing effects. Taking the percentages of petfood customers who said they were open to switching brands—which range from a low of 8% in a GfK survey to a high of 27% in a Pet Food Institute (PFI) survey—and applying those percentages evenly (i.e., not factoring in different price point foods) to 2006 North American petfood sales of US$16 billion suggests a shift in the pet food brands market worth US$1.3 billion to US$4.3 billion in petfood retail sales.
The main beneficiaries in the brand-switching trend, Packaged Facts predicts, will be higher quality premium pet foods chosen as alternatives to traditional brands—especially natural and organic pet foods, but also the often overlapping product segments of raw/frozen, refrigerated, homemade, 100% US sourced, locally grown and other smaller-batch petfoods. Supporting the reports from individual manufacturers and retailers of alternative petfoods claiming a double-digit spike in sales as a result of the recall, data backing up the shift to alternative petfoods are already beginning to emerge.
In an online survey of pet specialty retailers conducted by Pet Age from May 23 to May 30, 69% of respondents reported increases in sales of natural/organic petfoods, and over one-third said sales of fresh/raw foods were up. On the other hand, 21% of the pet specialty retailers surveyed said sales of traditional petfood were down, a finding that reflects a similar situation in mass market outlets. Even before the recall, the shift to premium petfoods was in full force, with two-thirds of the pet owners surveyed by GfK indicating that they bought premium brands at least sometimes and 40% saying they did so regularly. For the past few years this shift has, in fact, been the primary driver of petfood sales in the North American market, with virtually all of the dollar gains coming from value as opposed to volume sales increases.
