In recent years, the pet industry in Southeast Asia has continued to heat up, with Indonesia and the Philippines experiencing the most significant growth in the pet market. In addition, with the improvement of pet ownership rate, the increase of pet families, and the trend of humanization of pets, the pet market in the region is also developing towards high-end and high-quality direction, with a very promising prospect.
In this article, we will continue to provide you with in-depth insights into the pet market in the Philippines, Southeast Asia. Together, we will delve deeper into the country to understand the development status, consumption trends, and potential business opportunities of the local pet industry.
One、 Market Size&Growth Drivers
With the rapid economic growth of the Economy of the Philippines, the improvement of the consumption capacity of the middle class, and the promotion of the global pet boom, more and more local pet families are raising pets, and the development of the Philippine pet market is further accelerated.
From the perspective of the scale of the pet market, the global pet industry has gone global. According to a set of data recently shared by Global Pet Industry, although there is a lack of official data, industry experts have analyzed that the current value of the Philippine pet industry is approximately 6 billion pesos (108 million US dollars). This indicates that the Philippine pet market is large in scale and has great potential for growth.
Image: Global Pet Industry
From the perspective of compound annual growth rate, according to the "2022 Global Pet Market White Paper" data, over the past five years (2017-2021), Southeast Asia's pet attention has continued to grow, even surpassing the more mature US market at one point. Among them, the peak compound annual growth rate of the Philippine pet market reached 19.6%.
Image: 2022 Global Pet Market White Paper Data: Google Trends, Meet Intelligence
From the perspective of pet related searches, a survey conducted by iPrice in 2021 showed that due to the impact of the epidemic, the demand for pet companionship among Filipino residents has skyrocketed. The number of times they search for pets and pet related products on Google has increased by 118% compared to the same period in 2019, with the largest increase among all countries in Southeast Asia. In addition, from January to September 2021, there will be nearly 7 million searches, accounting for 53% of the total online searches related to pets in Southeast Asia, and the overall search volume will also be the highest.
Image data: iPrice
Of course, the growth of the Philippine pet market is driven by various factors, among which the following are some of the main driving forces:
1. Economic growth
In recent years, the economic growth of the Philippines has been maintained at over 5%, which has enabled more and more households to have more disposable income. People are willing to spend more money on pets and enjoy the pleasure of pet companionship.
2. Acceleration of urbanization
The process of urbanization has made pet raising more common, and due to changes in urban lifestyles, the supply of pet products and services has become faster. In addition, due to the fact that large pets are usually not allowed in urban apartments and apartment houses, small pets such as fish, birds, and reptiles have also become popular choices.
3. The influence of social media
The rise of social media in the Philippines has made it easier for pet owners to obtain information and advice about pet ownership, share their pet stories, and establish connections with other pet owners. This has sparked more interest in pet ownership, which has driven the development of the pet market in the country.
4. Development of e-commerce
Most people are keen to purchase Pet food, supplies and pet related services through online shopping platforms. To a large extent, e-commerce platforms provide more choices for pet owners and facilitate them to make purchase decisions.
5. Improvement of health awareness
With the improvement of pet owners' health and well-being, the demand for health products, insurance, medical and other related services related to pet health is also increasing, driving the development of the Philippine pet market segment.
TWO、 Family pet ownership rate and pet preference
In Southeast Asia, the penetration rate of dog ownership in the Philippines is higher than in other countries. Global pet industry insight has observed that Filipino pet owners have a very diverse variety of pet types, such as dogs, cats, fish, reptiles, rabbits, and so on. Among them, dogs and cats are the most popular, especially small dogs and cats, as they are suitable for indoor activities and are more convenient to raise.
According to iPrice's survey, the epidemic has made pets a great antidote to anxiety among Filipino residents, further accelerating their willingness to take care of pets. Data shows that the search volume for the sale and adoption of pet dogs in the Philippines is 460% higher than that of cats. In addition, the Philippines does not have strict pet keeping laws and regulations and can take care of homes, making it one of the seven countries with the highest number of dog owners in the world.
According to a pet ownership survey conducted by Rakuten Insight in January 2022, 79% of Filipino respondents stated that they own at least one pet, while only 16% of those who do not own a pet. As of January 2022, the proportion of people in the Philippines who keep pets is shown in the following figure:
Image: Statista, Data: Rakuten Insight
The same survey shows that the majority of pet owners in the Philippines have dogs, accounting for 81%. Next is cats, accounting for 50%. Other popular pet types include fish and/or other Aquatic animal, as well as birds. As of January 2022, the proportion of pets owned by the Philippines by pet type is shown in the following figure:
Image: Statista, Data: Rakuten Insight
Compared with the data up to January 2021, the ownership rate of dogs, cats, rabbits, aquatic animals, birds and other major pet types shows an upward trend, with an increase of 14%, 7% and 3% respectively. The ownership rate of aquatic animals and birds has slightly declined, but the decline is not significant. The ownership rate of hamsters and other small pets is relatively stable, so no comparison is made here. It can be seen that dogs still dominate the pet industry in the Philippines, with the highest ownership rate and growth rate.
The high dog ownership rate in the Philippines reflects the changes in the country's culture and economy, as well as the love and concern of Filipinos for dogs. According to relevant information, we have learned that the high dog ownership rate in the Philippines may be related to the following factors:
1. Cultural factors
In the Philippines, dogs are considered loyal family members and friends, therefore they hold a very important position in Philippine culture.
2. Lifestyle
The lifestyle in the Philippines is relatively traditional, with many families still living in rural areas and having more time and space to raise dogs.
3. Economic factors
With the promotion of the Economy of the Philippines' economic growth, more people can bear the cost of dog ownership, and pay more attention to the quality and experience of pet ownership.
Three、 Related expenses&consumption trends
Due to the popularity of dogs, the Philippine pet market has the highest proportion of consumption of dog related products and services. However, with the increase in cat ownership, related products and services have also shown a growth trend in recent years. Specifically:
In terms of product expenses, according to data from Rakuten Insight, 29% of Filipino respondents stated that they typically spend over 500 Philippine pesos per month on pet products, while 16% of respondents stated that they spend approximately 100 to 200 and 400 to 500 Philippine pesos on pet products. As of January 2022, the average monthly expenditure of Filipino pet owners is shown in the following figure:
Image: Statista, Data: Rakuten Insight
The types of products purchased, Pet food and pet supplies (such as home, cleaning, toys, etc.) are the most consumed categories by pet owners. According to Rakuten Insight, 87% of Filipino respondents said they bought Pet food and snacks, 54% bought beauty and hygiene products (such as cat litter, pet shampoo, etc.), 36% bought toys and activity products (such as cat scratch posts, Hamster ball, etc.), and 35% bought housing related items (such as cages, Aquarium, terraces, etc.) or bedding (such as dog beds or cat beds). Other products include clothing and accessories, health care products, smart products, Pet insurance, etc. As of January 2022, the types of products purchased by Philippine pet owners are shown in the following figure:
Image: Statista, Data: Rakuten Insight
In terms of consumer preferences, products that pursue cost-effectiveness and discounts are more popular when sold together with gifts. The most taboo is product quality, such as product deterioration or expiration.
Take the purchase of Pet food with the largest proportion as an example:
Philippine pet owners especially like imported Pet food, most of which come from Thailand, the United States and Europe. According to the data of the US Department of Agriculture (USDA), from 2016 to 2019, the US Pet food occupied a leading position in the market, which led to a significant increase in the export of cat and dog food to the Philippines. By 2021, the Philippines has become the ninth largest market for the export of cat and dog food to the US. Filipino pet owners are very price sensitive and prefer more economical options.
According to trade data from the US Census Bureau, US dog and cat food exports to the Philippines reached a historic high of $51 million in 2021. Compared to the first 11 months of 2022, US dog and cat food exports to the Philippines increased by 3%.
Image: Market situation for exporting dog and cat food to the Philippines Data: Trade Data Monitor
The Pet food Institute (PFI) reported that more than half of Filipino dogs and cats eat leftovers from dinner tables. The Foreign Agricultural Service (FAS) of the US Department of Agriculture explained that this "shows the great potential of transforming into pet dry food".
The sales volume of dog food accounts for the majority of the sales volume of dog food in the Philippines, which is expected to increase by 9% by 2023, mainly due to the growth of Dog biscuit. Cat food sales are expected to increase by 13%, mainly supported by wet cat food.
In addition, according to the latest data from Statista, by 2023, the income of the Philippine Pet food market is expected to reach 134.4 million dollars. It is expected that the market will grow at a Compound annual growth rate of 12.92% during 2023-2028.
Image data: Statista, the same below
In terms of per capita consumption, by 2023, the per capita consumption of Pet food in the Philippines is expected to reach 0.64 kg.
In terms of sales volume, by 2024, the sales volume of the Philippine Pet food market is expected to increase by 9.9%; By 2028, it is expected that sales will reach 117.5 million kilograms.
In terms of price, in 2023, the price of Philippine Pet food is expected to be 1.84 dollars per unit; By 2028, it is expected to rise to $2.10 per unit.
In terms of competition pattern, international Pet food brands dominate. According to the data of the Animal Industry Bureau (BAI) of the Philippine Department of Agriculture, there are 47 local Pet food manufacturers and 111 international (mostly from the United States) Pet food enterprises. The good news is that the category of Pet food is becoming more and more popular in the country, so the number of local Pet food manufacturers is increasing. Some larger companies are investing in this category to increase local production and reduce the country's dependence on imports.
It should be noted that the export of Pet food to the Philippines needs to comply with local regulations and standards, and needs to go through strict inspection and registration procedures. For example (including but not limited to):
1. Import license: Must apply for and obtain the Pet food import license issued by the Philippine government.
2. Label regulations: Pet food packages must be clearly marked with information such as ingredient content, production date, shelf life and use method, and use language and font with good readability.
3. Safety regulations: Pet food must comply with Philippine national standards and relevant laws and regulations, and any substance that may be harmful to pet health, such as chemical additives, is prohibited.
4. Inspection and quarantine regulations: meet the inspection and quarantine requirements of the Philippines, including detection of food rumen deformation (BSE), Foot-and-mouth disease, avian influenza and other diseases.
5. Provisions on cargo shipment and packaging: safe and durable packaging shall be adopted, and the original quality and freshness shall be maintained during transportation to ensure the quality of Pet food.
6. Other requirements: provide a full set of qualification and quality inspection reports of Pet food manufacturers, and ensure that Pet food meets international quality standards and industry norms.
Therefore, if you want to export Pet food to the Philippines, you must comply with the relevant regulations and standards of the country. It is recommended that export enterprises consult local lawyers or professional institutions before exporting to ensure compliance with local regulatory requirements.
In addition to the above consumption trends, pet health care, medical care, beauty and other services have also seen growth in recent years, which has virtually become one of the key driving forces for the rapid development of the Philippine pet market.
04. Distribution Channels&Industry Investment Opportunities
The distribution channels in the Philippine pet market are undergoing changes, with offline sales dominating. With the development of e-commerce, the proportion of online sales is constantly increasing.
At present, the main distribution channels in the Philippine pet market include:
Offline channels: such as Pet food stores, pet supplies stores, supermarkets, large supermarkets and related pet exhibitions.
Online channels: such as brand independent websites, vertical pet e-commerce platforms, third-party online e-commerce platforms, and emerging sales channels such as social and live streaming e-commerce are also constantly developing.
According to the latest data from Rakuten Insight, pet specialty stores, supermarkets/large supermarkets/convenience stores are the main channels for Filipino pet owners to purchase pet products, accounting for 49%, followed closely by online e-commerce platforms such as Amazon, Shopee, Taobao, etc