Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Dog and cat food; Dog and cat food by price platform (excl treats and mixers);
Dog and cat food by price platform (incl treats and mixers); Dog and cat food
by type (excl treats and mixers); Other pet food; Pet care products
Executive summary
1. EXECUTIVE SUMMARY
Promising future for pet food and pet care products
2005 appears to be a good year for pet food and pet care products. Rising
purchasing power and a higher tendency amongst customers to buy prepared food
are expected to cause a rise of 5% in value sales by the end of the year.
The rise in the forecast period will be even higher, when the market will see
a constant value CAGR of 6%, compared to 2% during the review period. This
higher year to year to growth will be caused not only be better economic
situation in the Slovak Republic but also by the higher willingness of
customers to buy prepared food for their pets.
In 2005, Slovak customers appear to be paying more attention to quality and
the nutritional value of pet food than in previous years. Despite this trend,
economy pet food is still popular among pet owners and its volume rise will be
one of the highest in the market. The whole market has huge potential for
further growth, as the percentage of prepared pet food is only about one fifth
of the EU average.
Dog food stays big
Dog food remains the most important subsector in Slovakia, accounting for
almost 55% of value sales of pet food and pet care products in 2005. During
the year, value sales of dog food are expected to rise by 5% on 2004. The rise
in value will be driven mostly by dog treats, which are becoming very popular
among Slovak purchasers of dog food. Without treats, the value rise would be
rather modest, as economy dog food is very popular. Dry dog food remains more
popular than wet dog food in 2005 as its price per unit is much lower.
The current trend of slowly shift of customer preferences towards higher
quality and higher price products will continue in the years to come, as
customers will put more pressure on the nutritional needs of their dogs. A
dynamic rise in the number of premium brands is expected, which will
positively influence value sales of dog food overall.
Premium cat food gaining in popularity
Cat food is expected to experience growth of 5% in volume sales and 3% in
value sales in 2005. Cat treats and mixers is the highest rising cat food
sub-subsector, but its share of total sales of cat food is not as high as dog
treats and mixers' share of dog food, which explains the slower value growth
within cat food. Even though cats are taste sensitive and demand higher
quality food than dogs, low-priced products, including private label, are
relatively popular among cat owners. As in the dog food market, also in the
cat food market is observable a trend towards higher class products, with
customers' preferences shifting towards premium quality products in line with
increased awareness of cats' food needs.
Multinationals dominate pet food and pet care products
Multinational companies dominate the market and are expected to continue to do
so over the whole forecast period. Master Foods Slovakia remained the leader
in 2004, with a value share of 32%. Master Foods Slovakia operates a number of
brands, including Pedigree, Chappi, and Frolic (dog food) and Kitekat,
Whiskas, and Sheba (cat food).
The second most important player in 2004 remained Nestle Slovensko sro with
over an 11% value share of the market. The future success of premium brands
lies in the hands of third placed The Iams Co, which held just under over 6%
of the market's value in 2004.
The fourth biggest player and the best Slovak company in 2004 was Tatrapet
Liptovsky Mikulas with a value share of 3%. Domestic producers have a hard
time competing with multinational companies, which profit from their global
presence and are able to bring in innovative products supported by massive
advertising campaigns, thus forcing Slovak/Czech companies to focus on economy
products. Despite difficult conditions, companies such as Tatrapet are still
able to generate sales to customers.
Supermarkets/hypermarkets vs pet shops
A fight between supermarkets/hypermarkets and independent pet shops is being
seen in the market. The former channel offers lower prices by mostly selling
mid-priced products, whilst the pet shops channel focuses on selling premium
products with the additional draw of its well-informed shop assistants. Pet
shops looks set to be the winner in 2005 with a 38% share of value sales,
although supermarkets/hypermarkets' share is rising faster and is expected to
reach 31% in 2005. Other channels only have secondary roles in the market.
There are no pet superstores in Slovakia yet, and veterinary clinics, other
food stores and non-food stores (mainly petrol/gas/service stations) hold
lower shares than the two main distribution channels.
Customers that do not show much interest in the nutritional needs of their
pets are regular visitors to supermarkets/hypermarkets. Professional breeders
and people with higher awareness of the various aspects of their pets'
nutrition tend to make their purchases in pet shops. They are also less price
sensitive and show higher brand loyalty.
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