ROCKVILLE, MD. — Pet food sales growth was clocked at 16.2% year-over-year in 2022, totaling $58.1 billion and accounting for 42.5% of total pet industry sales over the period, according to State of the Industry data from the American Pet Products Association (APPA). However, this solid growth is largely attributable to heightened prices.
“While we outperformed our 2022 forecast, we know this increase can be attributed in large part to higher than anticipated inflation, and we expect spending will follow a similar trajectory and remain steady in 2023,” said Peter Scott, president and chief executive officer of APPA.
According to the US Bureau of Labor Statistics, the urban consumer price index for pet food jumped from 156.25 in March 2020 to 192.67 in May 2023, settling at 192.36 in October. From October 2022 to October 2023, the inflation rate for pet food was approximately 6.52%.
In August, the Adobe Analytics’ Adobe Digital Price Index indicated pet product prices in the e-commerce channel were up 0.1% from September and up 5.54% year-over-year, a trend that continued into October.
Market research firm Packaged Facts examined the impacts of inflation on pet food spending in its “Pet Food in the US, 17th Edition” report, which highlighted the economic stumbling blocks and trends defining today’s pet food marketplace.
According to the report, 78% of dog owners and 84% of cat owners ranked pet food as one of the most important products for pet health, surpassing flea/tick and heartworm medications as well as supplements. While pet owners have not forgotten the importance of nutrition, inflated prices for pet food have caused some to trade down. For example, roughly one-third of pet owners who have switched pet foods in the last 12 months have moved to a lower-priced option.
This trend of trading down has also given way to consumer confidence for lower-priced pet foods. According to Packaged Facts, 37% of pet owners agreed that private label options “provide the same- or better-quality nutrition” than national brands. Additionally, these pet owners are still seeking out quality ingredients in their pet food formulations, regardless of price point.
Packaged Facts also shared key trends shaping the pet food landscape in its report, including rising popularity for fresh pet foods, science-based functionality, human-grade formulas and cat-centric offerings.
The firm remains confident in pet food sales growth, reporting an expected CAGR of 10% from 2022 to 2027.
Keep up with the latest pet food trends on our Trends page.
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