Premiumisation is a growing trend that has been climbing places and is in the top 3 of the main trends for 2021: digitisation, premiumisation and sustainability.
The pet care market grows year after year, with petfood being the one that contributes the most to this market, and manufacturers are always looking to capture the attention of the Pet Owner. When we consult the different agencies that study trends to meet consumer needs, we see Nielsen, for example, telling us what the consumer does not like (GMO, hormones, artificial preservatives for example); or Euromonitor, which highlights the attributes that a food must contain (health and well-being, sustainable, sources of protein for example).
Linking to premiumisation
For many centuries, cats and dogs have been associated with humans as work, guard, and companion animals.
Human beings in return have fed them and many times have even shared their food with them, but today the feeding of cats and dogs has evolved rapidly and has reached industrial feeding, which contains the balance adequate nutrients a pet needs.
Currently pets have taken a more important role in the life of human beings and are considered a member of the family. And so we live the beginning of the “humanisation” of pets where humans went from being pet owners to being parents of pets, a significant term because our “furry” child requires greater care and well-being.
As pet owners become more likely to treat their pets as members of the family, they tend to pay more attention to their pet’s food, seeking to make it healthy; not only feed it to meet its requirements, but something else is sought, it seeks to nourish them correctly, since good nutrition guarantees good health. Here we begin to see how premiumisation begins: understanding that the pet owner seeks the best to feed his furry child.
Going further into the topic, the petfood market is estimated to be worth more than US$140 billion. This market has evolved over time to offer pet owners different types of products, always seeking to meet the nutritional needs of the cat or dog. We have dry, wet or semi-humid foods, in addition to prizes or snacks of all kinds, and other types of diets that, without detracting from them, still occupy a very small space in the market. But there is nothing else left in the types of presentations, as we have already been talking about.
In the market there is a wide range of products that have been categorised within a segmentation that in practical terms is divided into three: economic (or standard) foods, medium-price (or premium) foods, and premium (or super-premium) foods. ). This terminology can make us think that it is a segmentation linked to the monetary value of the product, and in some way it is, but it also determines the quality of the food, because a premium food is made with ingredients of greater digestibility and greater nutritional value for the pet.
But if we reflect a bit, a product that contains high-quality ingredients should cost more than one with lower-quality ingredients. So the next question would be, if a pet owner, as we have been seeing, is convinced to give a pet food that guarantees a better quality of life to his pet, will he be willing to pay more for that food? The answer is yes. We can see this in the evolution of the prices per kg of food for cats or dogs in the last 9 years, where the annual growth rate has been 3.3% and, in addition, the forecast for the next 5 years shows a trend still higher to reach a variation of + 4.1%, according to Euromonitor, 2021.
Regardless of the segment, the Pet Food must meet the nutritional needs that the Pet needs, according to guidelines such as AAFCO, NRC or FEDIAF. However, a premium food refers to a particularity that makes it stand out for its extreme quality and for being aimed at a particular group, for example, therapeutic or human-grade foods.
There are multiple factors, ranging from nutritional levels (protein content, fat, etc.), specification of ingredients (meat as protein of animal origin), attributes that will give the pet a better quality of life (longevity, vitality, etc. .) or innovations seeking to satisfy the well-being of the dog or cat (dehydrated, ‘grain free’, etc.).
What a pet owner is looking for
The benefits observed, attributable to a food, are related to the feelings of the pet owner towards their pet, which can range from the importance of a modern container to maintain the nutritional value (smaller size, sustainable, etc.), which the ingredients are of high quality (meat and not by-products), that the pet eats it with pleasure (high palatability), that the shape and quality of the kibbles is superior and can be seen with the naked eye (size and shape of the kibble), that the product connects with the pet owner (breed, age, health benefits, simple and clear information, etc.), that the product meets a need for my pet (geriatric, active dogs, etc.), that is a superior formula (protein level, with probiotics, with vitamins and minerals, etc.), among others. All of the above speaks of a superior product, or premium, in the eyes of the pet owner.
We must consider within the premiumisation the demographic phenomenon where Generation X begins to decline and the Millennial Generation, and not too far away also Generation Z, begin to direct market trends. The younger generations have only grown up knowing pets as equal members of the family, eating a diet designed for the cat or dog. New Pet Owners are taking a holistic view of wellness and health that prioritizes simplicity and transparency. Consumers are bargaining for the highest quality foods when feeding their pets. Healthy food is seen as an investment in a pet’s longevity, with premium nutrition. But these generations of pet owners are also considering value for money when operating within pet care. Many are looking to find premium features at more affordable prices.
That said, premiumisation becomes complex and is not simply changing the category of food that is given to the pet. If my cat or dog eats an inexpensive food, I’d better change it to a more expensive food. But the requirement of the current pet owner is that the additional cost that he is paying for his food must be well founded with science, evidence, testimonials, etc.
According to Mintel (2021), petfood manufacturers are in a constant process of innovation to offer pet owners this premium product, but beware, the values sought by the pet owner may vary from region to region due to the degree of humanisation in which this market is found. In the USA the market seeks more functional attributes, to ensure maintaining the health and happiness of your pets in a simple communication with the use of “clean label.” In Asia, on the other hand, the attribute of quality and safety are aimed at reducing the risks of diseases, perhaps as a consequence of a pandemic issue. In Europe everything related to sustainability and natural products (free of artificial additives) takes importance. Finally, in Latin America, the pet owner looks for the so-called ‘superfoods’, which is based heavily on fortification to favor specific health aspects.
So, if we recapitulate a premiumised product, it contains a higher level of nutrients, it is made with better quality ingredients and it is also fortified with additives such as vitamins and minerals, omegas, chondroprotectors, natural antioxidants, etc. Remember that fortification must follow the same quality guidelines, for example, if we focus on the fortification of trace minerals, we know that the chemical characteristics associated with different sources of Cu, Zn and Mn such as sulfate, hydroxychloride, or organic chelate can affect the interaction between metals and other nutrients present within the gastrointestinal tract of the pet. A premium product will look for the best sources of raw materials to give the confidence that the pet owner looks for in a premium food.
In conclusion, a pet owner does constantly seek to premiumise the nutrition of his furry child. This premiumisation consists of a food with a higher protein content as an initial stage, with a protein source that guarantees the best availability of nutrients. Premiumisation also consists of seeking health benefits for the dog or cat, attributable to fortification. The millennial or generation Z pet owner, in addition to ensuring health and well-being, demands scientific evidence. Premiumization, in addition to the nutritional benefit of the cat or dog, must satisfy some needs of the parent such as sustainability and the manufacturer’s social commitment. And finally, the pet owner will be willing to pay more, but only just enough.