With sales of natural pet foods registering double-digit growth, it's clear Fido and Garfield are officially becoming members of the American family. Joysa Winter investigates the latest in pet food formulas
According to the American Pet Products Manufacturers Association, 63 per cent of US households have a pet, which equates to 69.1 million homes.
And these animals have to eat.
US retail sales of pet foods totalled $13.1 billion in 2003, up 3.3 per cent over 2002 sales, according to Packaged Facts. During the five-year period from 1999 to 2003, the market grew 17.2 per cent, and posted a compound annual growth rate of 4.1 per cent.
While these aren't huge growth curves, sales of foods marketed as 'natural' or 'organic' are claiming a growing piece of the pie. Packaged Facts estimates US retail sales in this speciality pet food sector at $375 million in 2004, or three per cent of total pet food sales. During the 2000-2004 period, annual sales gained by double digits, spurred by a record level of natural pet food product introductions in 2003.Trends in pet products often closely track trends in human products — and the buying of natural pet foods and supplements is no different. According to Pet Business's 2004 Pet Business Shopper Preference Study, 63 per cent of pet owners mentioned natural pet foods or treats as being of foremost interest. Productscan data indicate that the number of new pet products tagged 'natural' or 'organic' almost doubled from 2002 to 2003. This trend continued in 2004, with 452 products with natural, organic or natural-related tags having appeared as of November.
Perhaps one of the simplest indicators of where this market is headed happened in April with the announcement that 1,500 Wal-Mart stores will now carry Natural Life pet food. Certified organic, the foods contain no artificial preservatives, colours or flavours, and are fortified with Ester-C, for joint disorders, as well as vitamin E.
When Wal-Mart enters the game, that's a pretty good indication there's money to be made.
Principles behind pet foods
When it comes to pet food, manufacturers voice a common sentiment: nutrition is not just important but crucial. "When you talk about functional pet foods, you really need to look at the entire food as functional because unlike us, dogs and cats don't get other sources of nutrition," explains Jean Lizotte, vice president of new products for Old Mother Hubbard in Massachusetts. "They're relying on what's in the bag twice a day — so the entire recipe needs to be functional. Every ingredient we choose works together in concert, to provide a very specific overall function."
With that philosophy in mind, manufacturers and ingredients suppliers alike are noticing several trends in pet-food content, revolving around the common complaints of joint mobility and skin/coat condition. "I see both skin/coat and joint health as the two popular types of formulas today," says Bill Bookout, president of the National Animal Supplement Council. "This means hyaluronic acid and MSM for joints, and essential fatty acids for skin and coat. Daily vitamins are always good, as well as digestive enzymes and antioxidants."
Dale A Hill, PhD, PAS, manager of technical and marketing support for companion animals at ADM Animal Health and Nutrition in Illinois, sees a similar landscape. "Ingredients that are being used or being considered would include: chondroitin and glucosamine; luteins; lycopenes; isoflavones; and similar compounds from natural vegetable sources," he says.
"There are greater opportunities in the functional food area with fructo-oligosaccharides and mannon-oligosaccharides, especially in treat products. Functional foods with intestinal health, bone and joint, or weight control benefits are of most interest to pet food companies."
Jason Woodworth, PhD, NAFTA feed manager for Lonza Inc in New Jersey, identifies L-carnatine as an up-and-coming catch-all health ingredient for pet foods. "L-carnitine is a nutrient that is essential for optimal energy metabolism in the body. It plays an important role in weight reduction and management, proper liver and heart function, and age-related losses in metabolic efficiency. It is gaining a lot of attention from the pet food industry."
Specialised ingredients for healthy joints is probably the hottest area of supplementation, in part because of the high-susceptibility to joint injury and degeneration in large-breed dogs. Older dogs fall ill with degenerative arthritis, and hip and elbow dysplasia, and younger active dogs often injure their anterior cruciate ligaments, or suffer from osteochondritis dissecans, a problem with cartilage development.
Glucosamine and chondroitin have been used for years now in pet food to aid in joint cartilage synthesis. Articular cartilage acts as a shock absorber and a smooth gliding surface for bones with the joint, and it is made up of collagen, hyaluronic acid and glycoaminoglycans (GAGs). Glucosamine is responsible for the synthesis of hyaluronic acid and GAGs, and chondroitin is one of the major GAGs.
In recent years though, pet-food manufacturers have also been adding MSM and UC-II to their formulas as a new line of defence.
"MSM is really a rising star among joint health ingredients," says David Lakey, CEO of MSM supplier Cardinal Nutrition. "MSM affects connective tissue. Sulphur is a big component of connective tissue, such as hair, skin, nails and joints, and there's a lot of sulphur in MSM, so rejuvenating the sulphur in the connective tissue is beneficial. That is less a part of glucosamine's action. In the area of inflammation, MSM has been shown to have an effect in at least two separate studies, and glucosamine doesn't really work in this way.
"Another consideration we see in the marketplace is that cost matters, and on a per-dose basis, MSM is much cheaper than glucosamine/chondroitin."
UC-II, a patented ingredient by InterHealth Nutraceuticals, is a form of type II collagen found in the cartilage of bone joints. A recent study showed it was more than twice as effective in decreasing pain in osteoarthritic dogs than glucosamine and chondroitin alone. (See sidebar below.)
Another popular joint ingredient is green-lipped mussel (GLM), a species of shellfish Perna canaliculus. Humans have been taking the supplement for years due to its chondroprotective and anti-inflammatory properties, and it is now cropping up in dog foods.
GLM contains glycosaminoglycans, which acts similarly to glucosamine and chondroitin by reducing the level of lipid intermediaries that trigger cellular inflammation. A study published in spring 2001 by Veterinary Therapeutics found that GLM significantly alleviated arthritic symptoms in dogs, reducing joint pain and swelling.
Skin and Coat
Deficiencies in long-chain polyunsaturated fatty acids (LCPs) in cats and dogs can lead to a whole host of problems, most notably skin lesions and poor coat. In the mid-1980s, humans began supplementing LCPs for a range of health issues, including atopic eczema and seborrheic dermatitis, and the veterinary world soon followed suit.
Omega-3s and -6s are now routinely added to natural pet food lines in a variety of forms. PetGuard's dry and wet lines for cats and dogs contain both omega-3s and -6s. Old Mother Hubbard adds omegas to all of its food products. They also sell a special skin/coat soft gel capsule supplement called WellCoat, with omega-3s, -6s and -9s from borage seed, fish, evening primrose, sunflower and flaxseed oils.
Old Mother Hubbard's dry food for senior cats and dogs embraces many of the principles for both joint and skin health, packing in high levels of glucosamine/chondroitin, antioxidants, and added omega-3s and -6s.
Among the ingredients, says Jean Lizotte, vice president of new products, are "green-lipped mussel from Maine; sea cucumber from New Zealand; salmon, flax seed and herring oils; and antioxidants from fresh fruits and vegetables from the full colour of the rainbow. That can mean cranberries, blueberries, spinach, sweet potatoes, carrots and tomatoes."
While the competition among pet foods is fierce, the market for pet supplements is potentially much more open — if for no other reason that it has so much further it can climb.
Packaged Facts pegged the market for 'pet health products' — which includes supplements and grooming materials — at $45 million in 2004, reflecting a 30 per cent compound annual growth rate during the 2000-2004 period.
"We forecast annual growth averaging 20 per cent during the next five years," says David Lummis, pet analyst at Packaged Facts. "This will bring the market to $112 million in 2009."
One of the most important reasons for this growth trend has been the crossover of makers of human supplements entering the pets supplement arena, such as Nutraceutical Corp of Utah, whose line of supplements includes ActiPet Canine Complex and Feline Formula chewable multivitamin and mineral formulas. Flint River recently entered the supplements market for the first time, unveiling a line of four specially formulated supplements with probiotics. Made by Nature's Way, they include Daily Defense, Natural Defense, Liquid Rescue and Paste Rescue. All four products contain as their base ingredients Lactobacillus acidophilus, Lactobacillus casei, Streptococcus faecium, Saccharomyces cerevisiae, Aspergillus niger, Aspergillus oryzae and Bacillus subtilis.
PetGuard's supplement offerings include basic multivitamins, as well as a Yeast and Garlic Powder that can be sprinkled on wet or dry foods and contain B-complex vitamins. The company's Digestive Enzymes, in both cat and dog formulas, contain acidophilus and bifidus and are free of common allergens.
Old Mother Hubbard sells seven supplements for cats or dogs, all as chewables. "But the truth is, supplements are a very tiny part of our business," Lizotte says. "We launched them almost three years ago, so they are still relatively new, but the supplements category for pets in general is just not really thriving."
This may soon change, Packaged Facts says, thanks to new standards implemented in late 2004 by the National Animal Supplement Council (NASC). "These new standards gives supplements a credibility boost," Lummis explains. "NASC's new Quality Seal Program allows member companies to place a seal on their product labels signifying that the company adheres to the NASC's quality standards."
Looking to the future
With competition fierce and the costs of healthy foods prohibitive to some people, ADM's Hill believes functional pet foods will remain a narrow market.
"This is expected to remain a very small niche due to very high cost," he explains. "The inclusion of functional foods is expected to increase, but these products will not fit into the purchasing patterns of the very price-conscious buyer of mainstream pet food."
Market trends also might vary depending on the type of pet food. "'Natural' and organic are much smaller niche markets for cats than for dogs," Hill says. "Cats have unique tastes — they are finicky eaters — and owners tend to feed what cats prefer."
Horses might be one of greatest untapped markets. "Many people who feed horses tend to follow fads and secret recipes even more so than people with pets — anything to give their horse some type of advantage in performance," he says. "Functional products with perceived or real health or performance attributes enjoy a good share of this niche market."
Packaged Facts sees a market fierce with competition but rich with potential. "There will be much more competition," Lummis says. "Smaller natural companies will increasingly become acquisition targets." "But another important factor is the changing retail landscape. With Wal-Mart ramping up in organics and so many mainstream supermarkets now adding natural/organic products and store formats, this should rapidly broaden the consumer base beginning this year."