Where is the pet industry headed after its storied boom during COVID?
That was the chief question on my mind before my recent visit to the Global Pet Expo in Orlando. The media made much of the spate of pet adoptions (and subsequent returns) in 2020–2021, but a lot has happened since then. I was curious to hear the inside story behind the headlines.
Below, I cover the most notable pet trends. These insights are informed by talks with entrepreneurs at the expo and by Class VI’s experience closing record-setting pet business deals over the years, which have given us a good sense of what excites buyers in this space.
Cats are climbing
Total pet ownership is up about 5% since 2014, according to NielsenIQ research. Now about 56% of households across 18 countries (including the U.S.) have at least one pet.
Perhaps more notable is that cats are the fastest growing pet group within those households. Dog ownership still leads the U.S. market, but sits at about the same place it was in 2019 (33% of households). Meanwhile, cat ownership increased from 23.6% of households in 2019 to 27.3% in 2024.
This could be a good time for pet food or durable goods companies to pour more resources into their cat product lines.
The action is online
Want to build value in your pet company and attract investment? Review your online sales strategy.
Online pet care sales climbed notably in 2023–2024 while brick-and-mortar activity fell a bit. Still, many product categories experienced both online and in-store growth during that period, including cat litter, cat treats and—most significantly of all—wet dog food.
Social platforms play a role in driving online sales. For example, many users discover new products on TikTok and appreciate the ability to buy them right in the app. Another popular online offering is subscription services: since 2020, subscription pet food spending has outpaced non-subscription spending, and nutritional supplement subscriptions are more popular still.
Happier and healthier
Pet humanization is a broad cultural shift that’s influencing the pet care business—and M&A deals—in a big way. “Pet owners” have become “pet parents” as animals are increasingly seen as part of the family—a common saying among insiders is that pets have moved from the backyard to the bedroom in recent decades.
Humanization equates to more dollars spent on the pet equivalents of popular human CPG categories, such as grooming, entertainment, and healthy, premium food and supplements. Improved diet and veterinary care have extended the average pet’s lifespan, so dynamic pet care companies can pull in their share of those dollars for greater lengths of time.
The crystal ball is cloudy
My conversations with pet industry contacts have revealed some ambivalence. Growing ownership and norms around humanization are good for business, but there are macroeconomic concerns that could negatively affect the number and quality of M&A deals in this space.
Perhaps the biggest worry centers on tariff-induced inflation. Pet parents are happy to spend on premium products when times are good, but they could opt for cheaper choices if economic conditions lower the real value of their incomes. Not to mention, tariffs are already biting into many companies’ margins by inflating their supply costs.
If you’re a pet business owner, do your best to diversify your supply chain, stock whatever extra inventory you can, and get creative with product design to reduce your tariff exposure. If you continue to offer quality products with a solid online strategy, I hope you can successfully weather any economic turbulence and keep investors interested in your brand.