Unmet pet care potential in Asia: Hong Kong leads the way

Valued at $27.1 billion in 2021, Asia-Pacific is one of the fastest growing regions in pet care, registering a CAGR of 11.8% over the period under review (2016-2021). This performance is mainly due to the significant growth in the population of cats and dogs. While Asia-Pacific already stands out as the largest market for cat and dog population, its growth is also the highest among other regions, increasing by a CAGR of 7.4% over the same period. .

Source: Euromonitor International, Pet Care, 2023 edition

Cats in particular are gaining popularity over dogs due to rapid urbanization and relatively smaller living spaces in the region. Cats need less space and are also relatively independent, making them a great choice for busy singles or two-income households, who reside in small apartments or houses in urban areas. This leads to a rapid expansion of cat food, which grew from 22% to 32% of total pet care product sales during the reporting period.

Global Pet Care Products Breakdown.pngSource: Euromonitor International, Pet Care, 2023 edition

It should also be noted that in addition to developing countries, developed countries are also experiencing rapid expansion. Although slower than developing countries such as China and Indonesia, which posted high double-digit CAGRs during the review period, all developed Asia-Pacific countries except Japan , such as South Korea and Hong Kong, are also recording high single-digit or low mid-double-digit growth rates. This trend is also contributing to the overall growth of the Asian pet care market.

Asia Pacific Pet Care Sales.pngSource: Euromonitor International, Pet Care, 2023 edition

Hong Kong’s ultra-premium pet market, driven by extremely sophisticated consumers

Hong Kong has the highest per capita expenditure on pet care in Asia-Pacific. Markets in the region with similar dynamics and attitudes towards pets, such as Taiwan, Japan and Singapore, lag behind in comparison.

Expenditure per capita in Asia-Pacific.pngSource: Euromonitor International, Pet Care, 2023 edition

Hong Kong and Singapore have a similar number of pets per household at around 0.5, but Hong Kong experiences significantly higher per capita spending, nearly six times that of Singapore. The share of premium dog and cat food is close to 75%, while it is only around 55-60% for Japan, Taiwan and Singapore, highlighting the appetite for premium food and products in Hong Kong. Kong.

Premium Cat and Dog Food from Market.pngSource: Euromonitor International, Pet Care, 2023 edition

Neighboring countries such as Japan and Taiwan both have a higher number of pets per household compared to Hong Kong, around one per household, but their per capita spending is about half that of Hong Kong. The difference is due to the proportion of dog and cat population in these markets. The higher proportion of dog and cat population is helping to drive premiumization in the market as owners become more sophisticated in their search for pet care products due to the growing trend of humanization, especially for dogs and cats.

When analyzing the types of pets owned per household, Hong Kong, Japan and Taiwan have dog and cat populations compared to similar households, while Singapore is significantly lower. Singapore lags behind in terms of owning dogs and cats per household, with a higher share of other types of lower-maintenance animals, such as fish and small mammals, explaining the gap significant per capita spending compared to the three major markets.

With similar attitudes towards pets, pet ownership, and types of pets owned between Hong Kong, Japan, and Taiwan, the reason for the difference in per capita spending is the income gap. household median. Japan and Taiwan have very similar median household incomes, while Hong Kong’s median household income is 50% higher, allowing local consumers to spend more on each pet compared to other markets.

Besides daily pet care involving food and hygiene, consumers in Hong Kong want to improve the overall life experience of their pets. This is evident in the growing popularity of high-end experiences and services such as luxury pet-friendly stays at the Mandarin Oriental, Ritz-Carlton and Rosewood in the city. Petcare in Hong Kong is now moving towards an ultra-premium positioning compared to other Asia-Pacific markets.

Additionally, pet owners in Hong Kong are unwilling to sacrifice the quality of the pet food and health products they purchase, even in tough economic times. They have more money to spend on their pets as traveling abroad is not easy during the pandemic explained the resilience of the pet care market in Hong Kong in 2022 with growth at two digits. Increased awareness of health and wellness allows pet owners to project onto their pets what they see as beneficial to themselves due to the trend towards humanization, this driving strong growth in pet healthcare in 2022, especially for supplements.

Increasing attention to preventive health care for pets after the pandemic in Hong Kong

Nearly 80% of Hong Kong respondents take supplements at least once a month, according to Euromonitor International’s Voice of the Consumer: Lifestyle Survey in 2022. Pet owners are starting to buy supplements for their pets pet as part of their diet to improve well-being and improve their longevity and immunity. In response to the local appetite for pet supplements, a growing number of supplement players are entering the market, including PAW from Blackmores and Petural from Watson’s Petmacy, as well as the growing popularity of existing players such as ProVet and FAVOUR, which enjoy expanding distribution.