Latin America is emerging as one of the most dynamic regions for the pet care industry worldwide. It is projected to rank second in terms of per capita expenditure growth over the forecast period (2023-2028), with a yearly growth rate of 5% in constant prices. While the region's average expenditure still trails behind advanced markets, its steady growth is notable, highlighting the increasing relevance of pets in Latin American families. Furthermore, Latin Americans' average expenditure on pets exceeds the worldwide average by 22%.
This explosive growth aligns with a series of trends changing the market landscape, not only from the perspective of product offerings but also from the dynamics of the competitive landscape itself. These short-term trends are to be considered by any brand that wants to remain relevant in the market.
The new profile of a human’s best friend
As Latin America has the second largest share of its population living in large cities (above one million), only after North America, the growth rate of apartment households has nearly doubled that of individual house units in the last few years. This has paved the way for the growing adoption of cats and smaller dogs, to become families’ new favourite companions. Small dog and cat populations in Latin America recorded respective CAGRs of 8% and 7%, from 2018 to 2023, while the large dog population only increased by a 1% rate.
Humanisation as a growth driver of indulgence and premium categories
The humanisation of pets has grown over the past few years, especially in the post-pandemic period, with consumers spending time at home helping to strengthen their emotional bond with pets. In Latin America, 74% of owners consider their pets beloved family members, marking the highest share for any region, extending consumer health and wellness trends to them, as well as quality time and recreational moments.
This is reflected in the growth of pet treats.
Dog treats in Latin America saw a CAGR of 10% from 2018 to 2023, second only to the Middle East and Africa; it reached 19% for cat treats, indicating significant dynamism and growth opportunities for small and large competitors in a relatively small market
Source: Euromonitor International
Mars and Nestlé are the leading brands in this category, with a combined 60% share.
From claims to product design, brands adapt to lure consumers looking for natural products
Along with the humanisation trend, there is greater demand for natural products in pet food, which suppliers have promptly responded to with strategies that include packaging and product redesign. Consumers want to see non-processed ingredients in their pets’ diets and are willing to pay significantly more.
Products with claims such as natural and organic are, on average, 49% and 81% more expensive across the region
Source: Euromonitor International’s e-commerce tracking tool Via
An example of new brands launched to the market that have leveraged this trend include Melvin’s BARF in Mexico, a premium frozen dog food brand that offers meat in the shape of burger patties. Another example is the launch of Naturalis Lifebites from ADM in Brazil, a new GMO-free line with packaging that primarily displays the ingredients of the formula in their most natural shape, while minimising the space of the kibble representation. Both examples clarify that their appearance is as relevant as the formula.
The pursuit of a more sustainable life is reflected in sustainable packaging
The trend of seeking a more sustainable life is growing globally, and Latin America is no exception. Consumers are looking for healthier products due to existing health and wellness trends, but they also seek products with a lower environmental impact that align more with their value system. In Latin America, using sustainable packaging is one of the leading sustainable habits consumers seek.
In addition, according to Euromonitor International’s Voice of the Consumer: Sustainability Survey 2023, Latin America is the region that most seeks claims of "recyclable" and "recycled" in its packaging, with 57% and 60% of consumers, respectively.
Benefits of e-commerce as the driver of growth
Due to its convenience and ease, e-commerce has gained relevance globally, especially since the pandemic. However, it has also been boosted in Latin America by greater internet access, smartphone penetration, and the growing trust in this channel within the region, positioning Petz as the most important online pet food retailer in Brazil, and Mercado Libre in Mexico in 2023.
According to Euromonitor International’s Voice of the Consumer: Lifestyles Survey 2023, 41% of consumers are primarily motivated to use this channel by the ability to find a better price, while 35% of consumers appreciate free shipping, and 33% value the variety of brands available.
Read our article Driving Premiumisation in Pet Care Through Value Propositions to see how pet humanisation has led to the premiumisation of the industry, and visit our E-Commerce page to closely follow the development of this channel in Latin America.