Young Americans in the millennial generation often treat their dogs and cats as one would a first-born child, and according to experts, their spending habits show it. Now big pet-food brands are starting to feel the pinch, as these members of so-called "Generation Me" are insisting on higher-end cuisine for their fur babies.
What are the details?
Classified as ages 22-37, millennials with household earnings of $70,000 or more spent an average of $183 to buy gifts for their pets this past holiday season. That's $116 more than the typical American pet-owning consumer, so it's no wonder this demographic is having an impact on the pet food market.
The Wall Street Journal reported in November that major pet-food brands are starting to experience the same slump that big-name people-food giants have been battling in recent years: consumers opting for less-processed, fancier product.
Chris Mondzelewski, vice president of customer development at Mars Inc.'s North America petcare business, told the Journal, "The challenges you see across both industries are actually quite similar."
Spending on food has gone up across the board, but experts point to millennials as drivers of the trend. That age group is half as likely to be married than their counterparts from 50 years ago. They're also putting off having kids, and according to Jean Twenge, the author of "Generation Me," millennials are opting to adopt dogs and cats instead.
"Pets are becoming a replacement for children," Twenge told the Washington Post. "They're less expensive. You can get one even if you're not ready to live with someone or get married, and they can still provide companionship."
Beverly Petrunich, owner of doggy-daycare center DoGone Fun, agrees. She told the Journal, "They treat them like it was their firstborn child."
All this love for fur babies drove the average price of pet food from $1.71 a pound in 2011, to $2.55 a pound in 2017, according to analytics firm GfK. Demand for brands like Gravy Train, Kibbles 'n Bits, and Pedigree have slowed, while consumers favor grain-free foods with human-grade meats — at a higher price, and higher profit margin.
Don't worry about the pet-food companies just yet. Bobby Modi, head of pet strategy for J.M. Smucker (which owns several brands, including Racheal Ray's Nutrish line of pet foods), told the Journal: "Pet population growth is faster than with humans."