00:00Welcome back to Bloomberg This Weekend. I'm David Guerrero with Christina Ruffini, pet parent to Brutus, joins us here on
00:06set.
00:06Special segment.
00:07As well. Americans' pet obsession is expanding beyond traditional preventative care over the next decade.
00:13The U.S. pet market expected to grow more than, grow to more than $250 billion from about $150 billion
00:19today.
00:20And I'm only spending about a billion of that on my tiny dog.
00:23All right, Bloomberg Intelligence Consumer Staples analyst Diana Rosera-Pena is here.
00:27What is the future of pet retail? Is it online shopping? Is it traditional stores? I limit I do both.
00:34We have this fabulous, quite overpriced soccer jersey that I impulse purchase for Brutus.
00:38Show that off if you want.
00:39Let's see. I'm not sure which guy. Okay, see.
00:41Oh! I dropped my dog.
00:43But this is an impulse purchase, but I also, there's a lot of targeted ads online.
00:47There's a lot of Instagram ads. Where are people buying for their pets the most?
00:52I mean, it really depends on, you know, how young you are, your income level.
00:57It's, it's all across. The pet mania continues in the U.S. for sure. So it's, it's really interesting to
01:04see.
01:05Sorry, go ahead.
01:06No, you go ahead.
01:08Do we know, is there a certain category that's more likely to do, like if you're younger, you're more likely
01:12to shop online.
01:12If you're older, you're more likely to pick it up in person, or is it all, it's just across the
01:16board?
01:16So, actually, younger consumers are more likely to go to pet specialty retailers, such as Petco and PetSmart.
01:23Oh, interesting. Okay.
01:23Um, they, in our survey, they actually did about, you know, they, they, they said that they were going to
01:29these formats about 30%, uh, compared to like a little lower for e-commerce.
01:34And I think it's because there is that one-stop shop, uh, alternative that they seek, particularly if you're, you
01:41know, young, a young, you know, pet parent, you probably want to get, you know, into the grooming and like
01:48your, your accessories and food and all of that.
01:51We do have a lot of accessories.
01:52Is this a term you use, pet parent?
01:53I do. I don't. I, I stick to human. I say I'm his human, but I know most people say
01:58pet parent. Yes.
01:59Yes. When it comes to online spending, sort of what's driving those sales and that growth? I think about sort
02:04of the, the ads, you mentioned them, like get on some recurring plant.
02:07We have cats for cat food. Get, get on this plant. We're going to get them every month. Is that
02:11a main driver for, for those businesses?
02:13So auto ship, which is something that Chewy offers is not necessarily a big driver. In our survey, we found
02:20out that about 18% of respondents think that that is very important.
02:24However, over 60% of respondents said that, you know, they're, they like free shipping, the convenience, and also they,
02:31they're not going to say no to coupons and the like.
02:34So they, you know, there's a lot of, it seems to be while people prioritize their pets, there seems to
02:40be that, that underlying drive of, of, you know, value driven behavior.
02:47So you, you can see that online as well.
02:49And when you look at the big retailers, how is it split up between, I guess it would be Amazon,
02:53Petco, and Chewy? Are those the major players?
02:55Yes. So, um, Amazon is actually, um, from, you know, from what we saw, it was about 50% of
03:02the respondents said that they are going to, you know, Amazon.
03:05Chewy is also a high contender as well as Walmart. Um, it really depends on, you know, what your priority
03:12is.
03:12I, I will guess that for Amazon is more of a, you know, you're a prime member, you want to
03:17buy for, you know, every week you have your, your, you know, box of, of things.
03:22And then you're, you're buying stuff from Amazon.
03:25Um, you've surveyed a lot about sort of multi-pet households.
03:28Of course, there's only room for one Brutus in the Ruffini apartment.
03:32Um, but this is a trend as well.
03:34I mean, this is an important driver of, of growth and spending too.
03:36Yeah. So, um, obviously for multi-pet, um, households, we find out that they spend about $300, uh, a month
03:44compared to like 200.
03:46Um, so how much do you guys spend?
03:48Do you spend 300 a month?
03:49No, no, I'd say like 200, probably 150 to 200.
03:54Okay. That's significant.
03:55Yeah. Yeah.
03:56Yes. And, and, you know, there's always, that is, is very important for, you know, the, the producers as well
04:02as the retailers,
04:03because it gives them a little bit more alternative to, you know, for, for them to visit the store or
04:09buy more.
04:10So it's, it's definitely a profitable for them.
04:12You guys also asked what people were spending, were spending money on or were, no, I'm sorry.
04:17You also asked what people were concerned about.
04:19And this year you asked a new question and what was that?
04:23And it's like off the charts.
04:25Yes. So the first time that we asked about anxiety,
04:28and it seems that pen anxiety seems to be, um, something of concern for, for pet parents.
04:35Brutus, are you anxious?
04:36He doesn't seem anxious.
04:37I don't, I don't think he seems that anxious.
04:39No, he's fine.
04:40I look at that.
04:41I see anxiety and I see obesity as two of the main drivers there.
04:45Yes.
04:45So people are spending money on what?
04:47They're buying sedatives?
04:48And GLP one for it.
04:49No, no.
04:50GLP one for it.
04:50Is that true?
04:51My God.
04:52Peptides.
04:52Not yet.
04:52We just did a whole thing on peptides.
04:54Peptides are the new rage.
04:55But there's, uh, you know, a higher concern for, um, putting their pets on a diet and making
05:02them as comfortable as possible.
05:03And this is, you know, a big opportunity for obviously pharmaceuticals as well as, you
05:08know, um, especially specialty foods and the like.
05:11So it's, it's, you know, it's a boon for, for, for those.
05:14Is this the world in which you're waiting?
05:15You do all this stuff?
05:16No.
05:16No.
05:17I mean, he's not obese.
05:17He's not obese.
05:18He runs, I mean, he's very calm now, but he runs like a maniac.
05:21He burns it all off.
05:22But, um, you guys also talk about wellness visits and how you said around 17% of dogs
05:28and 29% of cats are missing their annual wellness visits.
05:31We don't do it.
05:32We don't either.
05:33I feel bad about that.
05:34But that's getting so expensive.
05:37I was just talking to some other pet owners in the park about this.
05:39And we were saying like the mission creep on vet visits and they want to see you four
05:43times a year and it's $800 each time.
05:45And so people are just not going now.
05:47Yeah, exactly.
05:48They're prioritizing other things.
05:50And that is, I would say, uh, food companies are doing a lot of good marketing on that because
05:56they are trying to convince, uh, pet parents that, Hey, if you feed your dog, good quality
06:01food, which usually comes at a higher price, then you can probably be comfortable, uh, skipping
06:07a few doctor visits.
06:08If that is true or not, it really depends on who you ask.
06:12That's not part of your survey.
06:13Yes, exactly.
06:13I mean, we have talked to, uh, vets and they mentioned that, you know, food, while they
06:19think it, you know, for dieting and the like, it's, it's a, it's a good thing.
06:23It doesn't necessarily, you know, cure any of the issues that we have seen with vets.
06:28Wow.
06:29All right.
06:30Uh, thank you so much for joining us.
06:31Diana Rosario Pena.
06:32Thank you so much.
06:33And the rest of the survey can be on Bloomberg.com, right?
06:36Correct.
06:36You get all your pet parent information right there.
06:39There you go.
06:39There you go.
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