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Blue Whale News, October 24th (Reporter Zhang Jinglun) In recent years, the pet consumption market has continued to be booming.

Double Eleven, as an annual consumer feast, has become the main battlefield for pet consumption. According to Tmall data, in the first hour of this year's "Double Eleven" opening, 15 pet brands sold over 10 million yuan. Within 4 hours of opening, 658 brands saw a year-on-year doubling in transaction volume, and 659 brands saw a year-on-year doubling in order volume.

In terms of the capital market, listed companies in the pet industry have also performed well. Recently, Zhongchong Co., Ltd. (002891. SZ), Petty Co., Ltd. (300673. SZ), Guaibao Pet Co., Ltd. (301498. SZ), and Yiyi Co., Ltd. (001206. SZ) have successively released their third quarter reports, collectively reporting good results.

Zhan Junhao, founder of Fujian Huace Brand Positioning Consulting, told reporters that with the acceleration of urbanization, the improvement of residents' living standards, and the increasing demand for lonely economy and emotional companionship, pets have gradually become an indispensable member of many families. This trend has driven the rapid development of the pet industry, and the market size continues to expand.

Pet stocks report third quarter collective good news

Blue Whale News reporters found that pet stocks that were the first to release their third quarter reports continued their growth momentum from the first half of the year, with good collective performance.

Data shows that Zhongchong Shares, Petty Shares, Guaibao Pet, and Yiyi Shares achieved revenues of 3.189 billion yuan, 1.323 billion yuan, 3.671 billion yuan, and 1.316 billion yuan respectively in the first three quarters, with year-on-year growth of 17.56%, 44.34%, 17.96%, and 33.43%, respectively. Correspondingly, the net profits and net profit growth rates for the same period were 282 million yuan, 155 million yuan, 470 million yuan, and 151 million yuan, respectively; 59.54%, 630.85%, 49.64%, and 72.72%.

In the view of Wu Daiqi, CEO of Shenzhen Siqisheng Company, with the improvement of the national economy, the number of people who keep pets is increasing. Pets, as emotional support for many groups, are valued for their food, clothing, and daily necessities, and the market is constantly expanding. At the same time, this industry has a low entry threshold and strong replicability, which means that there is also a high possibility of expansion. Based on this, companies focused on this track have also performed well.

Consumers are willing to spend money, and the market size continues to expand. According to public data, the consumption market size of pet towns in China reached 279.3 billion yuan in 2023, and is expected to soar to 361.3 billion yuan by 2026.

The market size of billions has attracted numerous brands to enter. According to the IT Orange Database, there were 45 financing events in China's pet industry in 2023, with a financing amount of 7.094 billion yuan. As of September 11, 2024, there have been 23 financing events in China's pet industry, with a total financing amount of 2.349 billion yuan.

The rise of domestic pet consumer brands

During this year's "Double Eleven" pre-sale period, the pet section has shown astonishing consumer power.

JD Supermarket's pet business has released a battle report for the first 4 hours before the opening day on October 21st. The report shows that the sales amount of JD's pet business in the first hour increased by 34 times year-on-year, and the number of customers who placed orders in the first hour increased by 10 times year-on-year.

Blue Whale News reporters noticed that on social media platforms, many netizens have made tables of the daily prices and Double Eleven purchase prices of various brands of food, and many netizens have also shared a list of food and supplies they plan to hoard for the "hairy children".

Xiao Jiu told Blue Whale News reporters, "This Double Eleven, I stocked over 20 pounds of dog food, 12 cans of freeze-dried food, fish oil, shower gel, cotton clothes, and shoes for my little dog, spending about 3000 yuan." Cat owner Mo Mo also stocked a cabinet of canned food and freeze-dried snacks.

It is the numerous pet owners like Xiaojiu and Momo who have further promoted the prosperity of the pet economy.

In the entire pet industry, the pet food market is the most in demand track, occupying the largest share of the overall market. According to the White Paper on China's Pet Industry (Consumer Report) for 2023-2024, food accounts for 52.3% of the pet market.

Previously, the "White Paper on China's Pet Food Industry" released by Deloitte China showed that the market size of pet food in China is expected to reach 114 billion yuan by 2026, with compound annual growth rates of 17%, 15%, and 25% for pet staple food, pet nutrition products, and pet snacks, respectively.

In the pre-sale situation of "Double Eleven" this time, the two series of pet main food products, cat food and dog food, are still big hits. According to data released by Tmall, within 4 hours of pre-sale, the sales of Fregate, a subsidiary of Goodbaby Pet, have surged nearly 10 times year-on-year. The sales of Xianlang have increased by over 500% year-on-year, while the sales of Taste of the Wild have increased by over 260% year-on-year. Stella&Chewy's Star Health Fun and Fromm Fumo have both achieved over doubling growth.

According to data from JD.com, four hours before the start of the competition on October 21st, Maifudi, another brand under Guaibao Pet, ranked first on the four lists of pet food: cat dry food, cat wet food&snacks, dog dry food, and dog snacks.

Blue Whale News reporters have noticed that in this year's sales promotion list, more and more domestic emerging brands have performed outstandingly, such as Xu Cuihua, Qi Oh, and Honest Mouth, which are emerging brands in various sub sectors. The new brand "Xu Cuihua", which specializes in cat litter, has not been officially operating on the Taobao platform for more than two years. In just 90 minutes, the transaction exceeded the full cycle of last year's "Double Eleven".

Expansion of segmented track market space

In addition, with the "Z generation" becoming the "main force of pet ownership" and the continuous deepening of the "personification" pet ownership concept, the demand in China's pet market is developing towards segmentation and diversification.

For example, the popular solid wood cat climbing frame brand "Meow Thinking Tree" on social media has surpassed last year's pre-sale cycle within 4 hours of the launch of Tmall's Double Eleven pre-sale, with pre-sale orders increasing by 800% year-on-year.

The relevant person in charge stated in an interview with the media that when they first decided to make a cat climbing frame, they saw that the appearance of the cat climbing frames on the market was similar and the quality was uneven. So they decided to innovate in materials and appearance, designing a batch of cat climbing frames with natural fruit tree trunks and distinctive design styles, which have won the love of many young users.

In addition to cats and dogs, rabbits, crawling pets, and birds have gradually entered the field of vision of young people and opened up growth opportunities for related products. For example, IgG, which specializes in selling parrot staple food and parrot health products, will not officially go on sale until July 2023. Its sales in the Tmall Double Eleven store have increased by over 300% compared to the same period last year.

Zhan Junhao stated that consumers' demands for the quality and personalized needs of pet products continue to grow, bringing more development opportunities to the pet industry. By creating differentiated brand positioning, companies can stand out in fierce market competition and meet the diverse needs of consumers.

In addition, pet care, companionship, funeral, learning, beauty, photography, medical and other sub sectors are constantly innovating their products and services.

Blue Whale News reporters visited multiple pet grooming shops in Chaoyang District, Beijing and found that pet grooming not only includes daily cleaning and care, but also provides refined services such as basic examinations, foot massages, and oral hygiene.

Zhan Junhao pointed out that the pet industry will present diversified, personalized, and intelligent development characteristics in the future. The future growth points will mainly focus on pet healthcare, pet supplies, pet nutrition and health care, and pet services.

In terms of pet healthcare, as pet owners continue to pay more attention to their pets' health, professional pet healthcare services will become increasingly popular. In terms of pet supplies and nutritional care, consumers will pay more attention to product quality and personalized customization. In addition, intelligent pet supplies will also become a growth point in the future, such as smart feeders, smart cat litter boxes, etc. By creating differentiated brand positioning, enterprises can deeply cultivate and refine in these fields, launch products and services that meet consumer needs, and win advantages in competition, "said Zhan Junhao.