Pet Products in Brazil

PROSPECTS

As the economy shows signs of recovery, consumers begin to trade up in cat litter

While cat litter posted positive growth rates during the economic crisis, they were well below other pet products categories. This is especially due to the fact that consumers traded down in cat litter products during the recession, opting for cheaper brands and private label lines and buying in bulk through the advancing atacarejo (warehouse club) channel.

Other pet products and pet healthcare show promising prospects for the forecast period

Pet humanisation is an undeniable trend among Brazilian consumers, especially those with higher disposable income, who increasingly think of pets as members of the family. These niche consumers are also becoming more willing to pay for products they perceive as premium, reflected in the growth of premium wet and dog food for example.

Pet dietary supplements see less attention from consumers

Despite the fact that Brazil is the second largest pet care market globally, it is still a relatively underdeveloped market when it comes to spending per pet. This market immaturity is reflected in the steep growth of pet dietary supplements over the final years of the review period as well as in the forecast period, even coming from a small base.

COMPETITIVE LANDSCAPE

Pet healthcare companies continue to dominate pet products

Traditional multinational pet healthcare players have a well-established leadership in pet products, especially due to being more historically available across a number of channels, from veterinary clinics to pet shops and pet superstores. There are virtually no national companies in the pet healthcare space, as it is a category with regulatory barriers to entry and a history of partnerships with veterinarians who recommend products.

Bayer AG and Merck & Co Inc gain relevance in pet healthcare in 2018

Although Bayer AG confirmed the global sale of its pet care division, to be consolidated in 2019, the manufacturer saw a good performance in Brazil in the previous year. Like its competitor Merck & Co, both companies invested heavily in marketing campaigns directly at consumers.

Other pet products remains highly fragmented

At the same time that leaders are further consolidating their shares in pet healthcare, other pet products remains highly fragmented. Current leader Total Quimica Ltda has been able to increase its share in recent years, especially through channels like modern grocery retailers and pet superstores, where working with chains allows it to increase scale and distribution.

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