|The APPMA 2007-2008 National Pet Owners Survey says pet ownership and spending on pets are at an all time high, an estimated $40.8 billion in 2007.
So why then does it seem that luxury products for pets are cooling off? One theory is increased competition. Since 2005 every category of high end pet products (bedding, spa, apparel etc) has at least doubled the number of manufacturers. Retail outlets are also popping up everywhere.
In 2004 there were only two high end “pet boutiques” in West Los Angeles (depending on your definition of pet boutique.) Now there are at least eight, said Lorna Paxton co-owner of Happytails. “And there were maybe 2 or 3 “spa” lines out there. Now I’ve lost count!”
So although consumers are continuing to spend, the dollars are being spread thin. Manufacturers may receive smaller orders from more stores. Why? It could be because those same stores who used to place larger orders now have competition on every corner vying for the same dollars. On the other hand, a January Pet Age article states that based on a survey they conducted, pet boutiques may be on the decline.
In a March 2008 article Pet Product News says that pet owners indicated that if financial constraints led them to reduce spending, they would cut back on pet luxuries, such as toys, pet fashion and professional pet care such as day care and walkers, grooming and name brand pet food. This was according to an online survey of 665 respondants on Dogchannel.com But we wanted to know more. So we conducted our own research.
Sandra Caldwell, owner of Three Dog Bakery in Phoenix, AZ, has owned her boutique for over 10 years, and says the same thing: “My business has progressively increased.”The increase in consumer spending shows that dogs have taken on an elevated status in our society.
“It used to be normal for us to wash our dogs in the back yard with a hose, and feed them the cheapest food you could find. Nowadays it’s much more main stream to care for our dogs with products that have better, more natural ingredients,” says Kevin Fisher, co-founder of happytails Canine Spa Line in Los Angeles, CA.
Perhaps boutique products are becoming less of a fad and more of a way of life. Fisher added, “this is like the internet bust in the late ‘90s. But even after the big bust the internet is still here and stronger than ever. The internet is no longer a trend or fad, but a normal part of everyday life.”He says the same thing is happening with high end pet products. “Store owners are worried that consumers are going back to basics but what’s happening is the hype is settling down and the entire level of pet care has risen.”
Pet food ingredients have become especially important since the food recall. “I think when the food thing happened, it pushed people to go to boutiques,” says Chris Price, owner of D.O.G. Pet Boutique in West Hollywood, CA, “because boutiques cater to the individual dog versus the masses, with their one size (or brand) fits all approach.” A blog on the Small Business Trends website on December 20th, 2007, from a National Pet Press writer, voiced pet owners are no longer willing to trust large corporations that produce pet products. “Instead of being spoon fed by advertising, pet people are doing a little research.” Back to Basics
In a February 2008 Pet Business article Maggie Marchese, VP at UPG Companion Animals predicts that while economic woes may cause a downturn in some “trendy” categories such as pet apparel, sales of everyday necessities should remain strong. However, Bob Vetere, president of the APPMA thinks that retailers shouldn’t count out the luxury-products segment just yet. “I think eventually this segment will start to level off, just because there’s only so many things that you can come out with,” he says “But because you still have such a large chunk of baby boomers reaching the point where their children are leaving home and they’re looking for something else to dote on, this will continue to feed the boutique and high-end segment for at least another three to five years, I think”
So, what should a boutique owner do with all of this information? Synthesized down, it means that products that have a purpose, solve a problem or fulfill a need are keepers. And luckily there are lots of high-end products available that look cute and trendy and also solve a problem—these are the products you want to buy. And there is so much available that you don’t have to carry the same brands that Petco or Pet Smart offer. Be different.
“When we develop a new product we always ask ourselves what problem this product going to solve” says Lorna Paxton of happytails. “We know that our upscale packaging may get the first purchase but it’s the stuff inside the bottle that will get the repeat purchase.” When selecting merchandise for your store, this is what you should be looking for- products that have style and function. So as for “boom or bust,” many pet boutiques are still seeing “boom.” And even if we fall into a deep recession, as Caldwell says, “People love their dogs. Even when they’re tightening their belt.”