Four Trends in the Mexican Pet Food Market

The distinguish analyst believes the Mexican pet food market still has plenty of room to grow.

Specific trends drive demand for dog and cat food in the Mexican pet food market, said Ivan Franco of Triplethree International, a market research and analysis firm. Franco's presentation on June 15 began the Septimo Foro México sobre Alimento para Mascotas Internacional (Seventh International Mexican Pet Food Forum) in Guadalajara, Jalisco, Mexico.

1. Economy or super-premium

Ten to 15 years ago, premium pet food brands, such as Purina ProPlan, were the first to dominate the pet food market in Mexico, Franco said. Over the past decade, cultural change and economic growth fueled demand in Mexico for pet foods as people moved away from feeding pets table scraps. During that period premium brands met pet owners' demands for nutritionally balanced dog and cat foods. However, two economic forces have given demand boosts to both lower and higher priced pet foods.

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As incomes have risen in Mexico, pet owners have started to buy more superpremium pet foods, he said. Just as in the United States, Europe and China, Mexicans increasingly view dogs and cats as members of the family. This humanization trend leads people to want to spoil their pets, and value-added superpremium pet food is a prime way that they do so. For example in 2016, demand for superpremium pet foods marketed as holistic boomed in Mexico.

On the other hand, when pet owners hit economic troubles or pet food prices rise, people are not returning to previous generations' habits of feeding human food scraps to pets. Instead, pet owners continue to buy dog and cat food, but choose lower-priced economy brands, Franco said. In 2016, inflation affected the Mexican pet food market as retailers increased prices.

'One can find prices for dry dog food that range from 15 pesos per kilogram, less than one dollar, up to 400 pesos per kilo,' Franco said. 'It's like the difference between getting a taco at a street vendor and getting a duck-meat taco at a luxury restaurant.'

2. Larger packages

Sales of larger-sized bags of pet food, more than 15 kilograms, have done well, he said. These larger-sized bags are particularly important in ecommerce sales of pet food in Mexico.

Internet-based sales of pet food in Mexico are still a small fraction of the market, Franco noted, but this sales channel has great potential for growth.

3. Room to grow

Although the Mexican pet food market has matured greatly in the past 15 years, Franco said there is still room to grow. In the past year, 215 new pet food and treat products have appeared on retailers' shelves, according to Franco's research. Even in the established premium dog food segment, there is still room to triple the market.

Retailers have started to capitalize on this room for growth too. More private label dog and cat foods have appeared in the Mexican pet food market. For example, super markets and grocery stores, such as Comercial Mexicana, Chedrauí and Soriana, have introduced their own private label brands.

4. Diversification

Especially for superpremium pet food in Mexico, companies are creating a wider variety of products, including treats. Many of these are targeted at pet owners' demands for natural ingredients and sustainability. Along with the growth in individual products, more brands are entering the Mexican pet food market. Some are produced domestically, while brands like Blue Buffalo from the United States have increased their presence in Mexico, as well.

Franco believes the Mexican pet food market still has plenty of room to grow. He advised his audience of pet food professionals to avoid trying to sell the cheapest product on the market. Instead, pet food companies may wish to keep prices a bit higher to send a message of quality, since nutrition and health have become prime motivators for pet owners in Mexico.

By Iván Franco Pet Food Industry