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In this article I want to take a look at the dog, cat and mouse. Unfortunately, when you think of the menu of a local Chinese restaurant, I have to disappoint you. It’s about the lovely pets.
In China, a large market for animal companions has now formed. The number of pets in China increased from 389 million to 551 million in 2013-2018.
For comparison: there are only 34 million pets in Germany. However, if you compare the population figures, you get pretty similar factors. In the Federal Republic, there are an average of 0.4 pets per citizen, in China there are about 0.38.
While the German pet market was able to generate sales of around $ 5.4 billion in 2018 (+ 1.5% compared to the previous year), it was $ 24.6 billion in China – an increase of 27.3% (!).
The pet population in China should continue to grow strongly by 8.2% annually from 2019 to 2022, and with it the turnover of the pet market.
In recent years (2006-2018) the market has grown rapidly. In 2006, only $ 700 million was raised. If you compare this with the US market, it quickly becomes clear what potential there is still here.
With a population of 330 million people, the US market generated $ 72.1 billion in fiscal year 2018. So every American spent an average of $ 218 on pets – the Chinese just $ 17.
If we assume that the Chinese would spend only half of the Americans on pets in a few years, i.e. around $ 110, then the pet market would have to grow to an annual turnover of around $ 160 billion.
The Chinese market would therefore increase almost sevenfold under this assumption. The past shows that this is not impossible. The pet market has grown by a factor of 35 since 2006.
Young Chinese in particular seem to be crazy about pets, especially cats. The Chinese newspaper ChinaDaily recently reported on the trend of dressing their own domestic cat in 汉 服 – Hànfú.
Hànfú – is the traditional silk clothing of the Han Chinese. After it went out of fashion, it is enjoying increasing popularity with some younger Chinese women. So why not the cats too?
Cat owners are mostly young women who are more likely to buy expensive, high-quality items for their domestic cats, the report added.
Of course that’s a little strange. The shareholders of the e-commerce platforms JD.com and Taobao (Alibaba) will be pleased to note that sales for Katzen-Hànfú increased tenfold in December (compared to the previous year) (!).
According to JD.com, high-end and high-tech pet products were also very popular at the recent Singles Day shopping event in 2019.
For example, a customer reports that on vacation or business trips he wants to look at his four-legged friends every day using a pet camera and even talk to them to keep in touch. Others buy GPS transmitters for their animals – it’s really pretty crazy.
The Qianzhan Industry Research Institute reports that a number of companies related to cats, including pet food, pet clothing, medical care, insurance, hotels and services, are booming in China.
However, most of them are not listed, which is why direct participation is not possible.
If you still want to participate in the growth of the Chinese pet market, an investment in the large e-commerce platforms such as JD.com or Taobao (Alibaba) definitely makes sense. Since the Chinese shop a lot online on the platforms mentioned, you can benefit from the growth of the pet market by participating in these values.
I have owned both values for a long time. Not only because of the pet market, but because of the megatrend e-commerce, which is developing particularly rapidly in China – but that’s another topic.
What do you think about the Chinese pet market? Do you have pets yourself and can you understand this trend or do you find it rather incomprehensible? Write it in the comments!
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