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SymphonyIRI
Pet
Pulse
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For analytical purposes the data sourced from available retail databases has been consolidated to provide consistent results. However, for some countries it has not been possible to source data pertaining to certain categories. When this has occurred it has been documented in the Notes section found at the end of the report.
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In the Radar
The Pet macro-category is not hit hard by the economic recession: value growth across Europe in Q3 2012 stays positive but is slowing down to 3.1%. This result is worse than the growth of Q2 2012 (+3.4%). The Pet macro-category does not grow like in the past, but once more its trend is better or at least in line with the trend of FMGC products. The value growth is driven by a an increase in prices more than by an increase in volumes. Price inflation and more premium sectors in small sizes matter in this value growth. Different tendencies coexist: smaller premium products grow together with convenience products by private labels.
The PET Community of Interest- Symphony IRI Group Contact: Paolo Garro Business Insights Director/ +39 02 52.579446 / mob: +39 335 12.80.902; paolo.garro@SymphonyIRI.com
Population in Millions
Unemployment (%)
GDP in Millions ()
January 2011 France Germany Italy Netherlands Spain United Kingdom 65.0 81.7 60.6 16.6 46.1 62.4
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Global Trends
Value sales and growth and decline in the last year
Value Sales in Millions ()
+4.2%
Total EU DE
+1.0%
+1.4%
UK FR IT ES NL
+3.5%
+7.1% +2.3%
Negative Trend
France
455
Germany
545 517
309 75 132
291 72 131
521
497
2-Oct-11
1-Jan-12
2-Apr-12
1-Jul-12
1-Oct-12
Period Ending
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Europe
4,073
50.3% 36.9%
Millions Euros
3,500
2,990
3,000 2,500 2,000 1,500 1,000 500
760 279
3.4%
9.4%
Cat Food
Dog Food
Pet Accessories
Category Evolution
Value Sales () and % Change vs. Yr Ago 4.073
93
Key Trends
The value of the European market grew by 3.1% on average across the six countries during the year ending Q3 2012; this is slightly worse than the growth of Q2 2012 (3.4%) Spain, UK and France are confirmed as the top countries for growth in the year ending Q3 2012 . Cat food remains the core business and the trend setter of Pet Care, showing the fastest growth. Dog food is also growing but not at the same pace; the growth of Pet accessories is positive, whilst other Pet food is negative. The marketplace continues to become more competitive for branded products due to the increased promotional activity and the growth of Private Label. Pet Care is not as promotionally reliant as most major FMCG markets, but promotions are growing across most of the countries and pushing sales.
73
2.990 Millions
53
33
760
4,1 2,7 2,3
13
279
-5.3 -7 Other Pet Food
Cat Food
Dog Food
Pet Accessories
Total Sales
% vs. YA
Europe includes: France, Germany, Italy, Netherlands, Spain and United Kingdom Source: SymphonyIRI Retail Databases; Period Ending 01 Oct, 12
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Europe
Cat Food
161.3
Dog Food
77.7
Pet Accessories
17.2
-15.6
Category Key Findings The main contributor to the growth of Pet Care across Europe is Cat Food (+161 million ), whilst a smaller but relevant contribution comes from dog food (+77.7 million , where the driver is snacks and treats) and a limited contribution from Pet Accessories. Dog Snacks & Treats segment are becoming increasingly more important and significant due to its growth in Value and Volume in all European Countries Wet cat single serve is the driver for Cat food, where brands are investing most, and to a lesser extent dry cat food. The main focus of NPD by major brands is on new premium tastes in small sizes or on new user friendly packages; no real new concept innovations in the market unless we consider the growing importance of oral care concept in snacks and treats. Private Label is growing across most of the markets and represents a cheaper but acceptable alternative offer compared to major brands, in the tough economic climate were living. Pet Care appears to be an increasingly polarised category; economy products are growing (Private Label) as well as Premium products in small sizes. The shopper is not unique and the shopper of Dog food may behave very differently from the shopper of Cat food.
Europe includes: France, Germany, Italy, Netherlands, Spain and United Kingdom Source: SymphonyIRI Retail Databases; Period Ending 01 Oct, 12
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France
918
31.1% 46.1%
Millions Euros
620
330
123
6.2%
16.6%
100 0
Cat Food
Dog Food
Pet Accessories
Key trends
Category Evolution
Value Sales () and % Change vs. Yr Ago 918
The market trend of Pet Food is similar to the FMCG trend (about +3%). Growth is still mainly driven by the Cat Food : Wet Cat growth is moderate (+3.5%) whereas Dry Cat continues to be very dynamic (+8%). Snack and Treats is the fastest growing category : Cat Snack & Treats(+21%) grow through assortment development (+28%) Dog Care & Treats (+12%) benefit from more NPD and more promotions.
Millions
620
330
123
4.4 -2.8 Pet Accessories % vs. YA Other Pet Food
The growth of the cat population has a positive impact on Cat Food, Pet Accessories , and Cat Litter (7.5%). No change on other Pet Food. This decrease is due to all types of products. The Dog Food trend continues. Wet food is negative (-6%) with dry food positive (+4) thanks to Care and Treat, Main meal (+2%) has also made a contribution to growth.
Total Sales
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France
Cat Food
48.2
Pet Accessories
14.0
Dog Food
7.9
-3.5
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Germany
56,7%
1.200 1.000
1.186
Millions Euros
683
32,7%
146
76
3,6%
7,0%
Cat Food
Dog Food
Pet Accessories
Category Evolution
Value Sales () and % Change vs. Yr Ago
Key Trends The Pet Food category in Germany is growing at a steady pace in value (+1.9%) which can be attributed to increase in average prices by 2.1% while volume sales show a slight decline (-0.2%)
1.185,87
Millions
683,49
Cat food maintains its position of the leading category within pet food and is the only category with rising volume sales despite the rise in average prices
145,90 75,55
-11,5 Other Pet Food
3,5
Cat Food
Decline of Other Pet Food and Pet Accessories is mainly driven by birds and rodents, fish food is growing in volume however declining in value sales Private Labels Pet Food grows due to increase in average price while volume declines for all the categories except for the cat food
vs. YA
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Germany
Millions 50
Cat Food
39,6
Dog Food
4,9
-5,5
Pet Accessories
-9,8
Category Key Findings Cat Food & Dog Food are the only drivers of the growth in the Pet Market and all other pet food and accessories are declining in sales Hypermarkets & Hard discounters are the most important sales channel for Pet Food private label products are driving the growth of Hard discounters Cat Food which holds more than half of the sales share of the Pet Market is mainly driven by wet food which grows by 4.1% in value sales and 3,3% in volume sales; however declining in dry food by -4.1% in value sales and -8.6% in volume sales. Single packs are compensating the loss done by multipacks, indicating the that consumers prefer convenience Dog Food which holds around one-third the sales of the Pet market is mainly driven by the growth in the Dog Snacks in value sales(3.5%),however is declining in volume sales(-1.0%);Chews is the main segment of Dog Snacks Dog wet food declines by -1.8% in value sales and -3.7% in volume sales and Dog Dry Food grows by 1.2% in value sales, primarily based on the core size class of 2.5 4.9kg(3.6% growth in value sales). The trend is contrary to the Cat Food where wet food grows and dry food declines The subcategories of Bird Care, Small Animal Care and category Cat Litter (-3.5%) are the strongest drivers of the negative trend for the Pet market.
10
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Italy
636
53,2%
Millions Euros
403
400 300 200 100
33,7%
137 21
1,8%
11,4%
Cat Food
Dog Food
Pet Accessories
Key Trends
Category Evolution
Value Sales () and % Change vs. Yr Ago
636,31
Total Cat and Dog Food continues to increase in value sales and in the year ending Q3 2012 (2.7% for Cat and 3.0% for Dog); but volume sales do not keep up (so: less kilograms sold but more value sales for Cat Food and Dog Food ). Cat Food remains the core business of the category, accounting for 53,2% of the total value sales, and shows an increase of 2.7%. Dog Food performes slightly better (+3.0%) while both Pet accessories and Other Pet Food are losing value sales.
Millions
402,81
136,65
2.7 Cat Food 3 Dog Food
21,16
-1.5
As a general comment, Dry Petfood is performing better than Wet Petfood but inside Wet Petfood two trends -which relate to premium products- are remarkable : Wet Single Serve drives the performance of Cat Food with a growth of 4.6% in value sales, whilst Dog Food is still driven by wet small and medium package products (+1.1%). Snacks &Treats remains the fastest growing segment of the category for both Cat (+51.8%) and Dog Food (+10.3%).
Total Sales
11
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Italy
Cat Food
17,0 11,7
Dog Food
Italy
-0,3 -1,3
Other Pet Food Pet Accessories
Category Key Findings The main contribution to the growth of Pet Care category comes from Cat Food, with a 17.0 million increase in sales; the growth of Dog Food is smaller, but anyway relevant (11.7 million ). Products in small packages are still driving the positive performance of the market both in Cat and in Dog Food, confirming that there is a cluster of shoppers who keep on buying premium products -with user friendly packages and special tastes- regardless of the difficult economic situation. The increasing attention of the shoppers to pets health is reflected in the considerable growth of Dog Functional Snack & Treats segment. Cat Snack & Treats still is a niche market, as if it shows highly positive trends. Pet Accessories and Other Petfood are losing value and volume sales, thus confirming their marginal weight in comparison to Cat and Dog food. The growth of promotional activities and the increasing importance of DOBs in most of the segments make this market a highly competitive one (the % of promoted volumes in Pet food gets up to 25.0 with +0.5 points vs last year. Private Label reaches a 41.8% volume market share, with +1.2 points vs last year in Hyper+Super+Small Self Service). So Petcare is not a category that is highly impacted by the recession, as it is growing above the average of FMCG products (food and non food; +1.1% year ending Oct 2012); however,the growth in value goes with a decline in volumes.
Source: SymphonyIRI Retail Databases; Period Ending 01 Oct, 12
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Netherlands
148
50.7%
Millions Euros
29.2%
120 100 80 60 40 20 0
85
48
3.9%
16.3%
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Cat Food
Dog Food
Pet Accessories
Category Evolution
Value Sales () and % Change vs. Yr Ago
Key Trends Cat Food is still the most important category within Pet Food. This year this category increased by 2.2% to a total of more than 148 million euro. The increase is caused by the increase of Dry Cat Food. The second largest category, Dog Food, is decreasing for a couple of periods now and decreased by more than 1%. The segment Pet Accessoires is growing for a long time now. The total turnover is now more than 47 million euro; an increase of 5.5%
148,19
85 75 65 55
Millions
85,32
45 35
47,60
2.2 5,5 -1.2
25 15 5
11,42
-14,0
Pet Other Pet Food Accessories
-5 -15
Cat Food
Dog Food
Total Sales
% vs. YA
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Netherlands
Millions 4
Cat Food
3.2 2.5
Pet Accessories
-1.0
-1.9
Dog Food
Category Key Findings The total sales of Pet Food in the Netherlands is growing very little. The total sales of supermarkets is growing faster in total than in Pet Food. The volume of Pet Food in the Netherlands is decreasing; so the increase of the sales is mainly caused by higher prices combined with higher sales in the mix of Pet Food Both Cat and Dog Food volumes are decreasing; it is striking that both Cat and Dog Food sold from the freezers are increasing in volume. This may be caused by the crisis; shoppers are buying cheaper food for their pets and food which can be stored easily. Also a much higher promotion share of freezing pet food has caused this. Promotions in total Pet Food have increased as well. In the third quarter of 2012 the promo share is higher than in the same quarter in 2011: from 30% to 31%.
14
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Spain
Category Value Sales and Share of Value in the Last Year
59.8%
316
Millions Euros
185
35.0%
5.1%
27
Dog Food
Cat Food
Category Evolution
Value Sales () and % Change vs. Yr Ago
Key Trends
The Pet Food market shows a good behavior due to the growth of its three segments: dog food (+7.5%), cat food (+7.4%) and other pet food (+1.1%). Private label has reached a 48.3% market share and it is higher in the dog food segment (54,8%). Dry dog food experienced major growth (+8,2%) wet dog food increased by only a +5.1% in value since this segment has a higher level of private label presence (+76.8%). Wet food is a more expensive product but the private label is focused on formats with major volume, whereas the manufacturers are focused on the single serve products with a higher value but less weight. Cat food experienced a growth of 8.1 % in value. This behavior in value is due to the success of the single serve products.
1.1
315.67
Millions
184.84
7.4
27.12
The snacks and prizes segment is growing significantly (+10.2 % for dogs and +29.5% for cats) due to new launches in the market. Other Animals has increased mainly due to Birds (+4.1%) and Rodents (+6,5%).
% vs. YA
15
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Spain
Millions 20 25
Dog Food
Cat Food
Category Key Findings Notwithstanding four years of economic crisis, the pet food market continues to demonstrate good health, it is experiencing growth over the FMCG market (+2.2 %). There are several factors that have a direct influence in the mentioned growth; for example the continuous innovation of companies that offer products with more added value. This added value 48.3% market share that the private label has is leading to lower pricing. The decrease in prices is also influenced by the dry food for dogs since it is the lowest priced product in the market, it experienced a growth of +8.2%. Meanwhile, cat food experienced a growth of 8.1 % in value due to the wet single serve success stimulated by the latest launches. But, it seems that the manufacturers are concentrating their efforts in innovating the snacks and prizes segment, which has had an increase of +10.2% for dogs and +29,5% for cats.
16
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United Kingdom
1,000 883
Millions Euros
49.9%
44.1%
1.0% 5.0%
0
100
21
Cat Food
Dog Food
Pet Accessories
Key Trends
Category Evolution
Value Sales () and % Change vs. Yr Ago
1,000 883
The Uk has been experiencing an extremely wet summer , with localised flooding. These poor conditions are helping to keep volumes in Pet Food buoyant, with Pets staying in the home more we have seen volumes for Dry Food, Care and Treats along with Litter all do well this year. Price inflation is also a large factor driving value growth. Cat Treats continues to grow well with Nestle now launching into this growth market.
Millions
100
4.2 Cat Food 3.8 Dog Food
8.1
21
-1.8
Total Sales
Data for the United Kingdom does not include Northern Ireland Source: SymphonyIRI Retail Databases; Period Ending 01 Oct, 12
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United Kingdom
Millions 40 50
Cat Food
Dog Food
Pet Accessories
-0.4
Category Key Findings Own Brand ranges continue to develop, with Waitrose launching their own label offer in the UK with a two tier price strategy for Own Label. We continue to see trading up into premium cat food sectors encouraged by significant promotion.
Data for the United Kingdom does not include Northern Ireland Source: SymphonyIRI Retail Databases; Period Ending 01 Oct, 12
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Final Notes
Notes on Category Definitions for Countries Due to the diverse products found in individual countries across this market it was necessary to consolidate the available data into the categories in this report. In some cases it wasnt always possible to align products across all 6 countries hence the need to highlight any anomalies in the report. Those exceptions are listed below: Other Pet Food The UK data in this report only includes bird food where the other countries include fish food and rodent food Pet Accessories The UK data in this report only includes cat litter and does not include pet hygiene products, aquarium accessories or pet toys The Spain data in this report does not include this category The Germany data in this report does not include pet toys
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Resources
To gain insight into opportunities across specific categories, segments, channels or retailers, contact your SymphonyIRI client service representative regarding custom analyses leveraging the following resources: InfoScan Census is a syndicated retail tracking service that enables manufacturers and retailers to acquire industry insights used to make better business decisions. InfoScan Census utilizes the data that SymphonyIRI Group collects from grocery, drug, and mass merchandise retailers to provide the most comprehensive and accurate syndicated data offering in the Fast Moving Consumer Goods (FMCG) sector. With access to accurate, granular detail by category, geography, measure, and time period, clients have the tools needed to develop marketing and sales strategies based on product performance, distribution, and promotion responsiveness. All data about pet comes from InfoScan Census. SymphonyIRI Consulting provides strategic insights and advice leveraging a variety of data sources, predictive analytics, enabling technologies, and business analyses to help FMCG manufacturers and retailers address significant sales and marketing issues effectively
About SymphonyIRI Group SymphonyIRI group, formerly named Information Resources, Inc. (IRI), is the global leader in innovative solutions and services for driving revenue and profit growth in CPG, retail and healthcare companies. SymphonyIRI offers two families of solutions: core IRI solutions for market measurement and symphony advantage solutions for enabling new growth opportunities in marketing, sales, shopper marketing and category management. SymphonyIRI solutions uniquely combine content, analytics and technology to deliver maximum impact. SymphonyIRI helps companies create, plan and execute forward-looking, shopper-centric strategies across every level of the organisation. For more information, visit www.SymphonyIRI.eu
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