From 3-5 April, 2017, more than 2,700 people converged in Kansas City, Missouri for the 25th annual Petfood Forum conference. Attendees and speakers spanned the entire industry – from ingredients and machinery companies to manufacturers, marketers, retailers and academics. Despite this diversity, much of the discussion at the event centred around one theme: how can we adapt to the ever-growing pet humanisation trends that are dominating the industry? While this trend is hardly new, its prevalence is reshaping the entire industry with growing demands for novelty, transparency and accountability.
Standing Out In a Hypercompetitive Market
As pet humanisation trends mature, so has the market for premium dog and cat food. As a result, traits like “grain-free,” “natural,” or “meat-first” have become largely universal among premium brands and are no longer distinguishing features in the market. Ryan Yamka from Luna Science and Nutrition said it best when he called these features “the cost of entry in today’s market.” In fact, these traits that once defined a super-premium food are now trickling down into mass channels with brands like Rachael Ray Nutrish. GfK’s Maria Lange also highlighted a new tier of rapidly-growing “Value Natural” and private label brands within pet specialty channels. This leaves premium pet food manufacturers with a very difficult question: how can my brand stand out against cheaper “natural” and “grain-free” competitors?
Yamka’s presentation highlighted novel ingredients and protein sources as a key point of differentiation. In order to stand out in a crowded field, a brand must offer a unique protein source or ingredient and provide tangible benefits for pet owners. However, the process of finding, vetting and introducing these new ingredients from suppliers is a difficult one that must be done thoroughly and with great caution.
Biologically-appropriate (BA) diets have been a hallmark of some premium pet food brands, and growth from raw, freeze-dried and frozen foods has been especially strong in this space. Many advocates of BA diets employ comparisons of dogs to wolves and cats to lions in their marketing. Emma Bermingham of AgResearch Ltd dissected the science behind these diets, finding that cats actually benefit more from high-protein BA diets than dogs. Despite this, the cat food market remains far behind dog food in terms of premiumisation and the development of all-meat varieties. This presents a significant opportunity for brands and companies to expand in an underserved segment of the market.
A New Age of Mistrust Among Consumers
As pet owners become pet parents, they have grown increasingly critical of pet food manufacturers. Chris Mondzelewski of Mars Petcare discussed how the past decade has seen a dramatic increase in consumer mistrust of government and big business. This puts big pet food manufacturers at a distinct disadvantage, as pet parents are inherently biased against them in favor of small, craft or artisanal brands. GfK’s Lange also highlighted the shift toward family-owned, local brands as an emerging trend in pet food. This inherent mistrust – especially with bigger companies – poses a huge challenge in pet food.
Melissa Brookshire of North River Enterprises delivered a presentation on how customer service plays a vital role in this new age of mistrustful pet parents. Negative press, whether warranted or not, can go viral with the widespread adoption of social media and product review websites. Word of mouth is more powerful than ever, and mistrustful consumers are often quick to blame a pet’s food for almost anything. In this environment, the ramifications of bad customer service can be devastating and can threaten the equity of an entire brand. Companies need to develop a renewed commitment to customer service in ways that resonate with an increasingly tech-savvy consumer base.
This new era of pet parenthood has also transformed the way we study animal nutrition. Maria de Godoy, an Assistant Professor of Companion Animal Nutrition at the University of Illinois at Urbana-Champaign, highlighted how invasive research techniques like biopsies are no longer accepted in the study of companion animal nutrition. Although these techniques were widespread several decades ago, pet humanisation trends have led scientists to develop an entirely new set of research tools collectively called “omics” to study the effects of pet diets on disease and gene expression.
Addressing Industry Challenges
Petfood Forum highlighted the challenging market landscape facing companies in the pet industry in 2017. Longstanding humanisation trends have created a hypercompetitive pet food market in which former points of brand differentiation – like “grain-free,” “natural,” or “meat first” – have become a bare minimum and necessity for market entry. At the same time, pet parents have become increasingly distrustful of pet food companies. The risks related to product recalls, poor customer service or bad press have become astronomically higher, and companies face major challenges from distraught consumers that are prone to blame a pet’s food for any type of health issue. The speakers at this event provided a wide range of tools, advice, education and suggestions for the industry, offering ways for pet food companies to find their way in today’s complex market.
Petfood Forum 2018 will be held from 23-25 April in Kansas City, Missouri.