Today, we are going to talk about a rapidly growing opportunity: the pet industry. When you think of the pet industry, many people might find the topic a bit cliché. It often feels like the conversation revolves around dog houses or cat food. What else could this industry offer?
Hold on a second. Let me ask you a question. Have you noticed that the legs of pet dogs seem to be getting shorter these days? Apart from certain breeds that naturally have short legs, it seems like many dogs are having shorter legs. Have you ever thought about why this is happening?
Here’s another question: Have you noticed that many pet cats are becoming more “dog-like”? Cats have always had a wild side, but in recent years, many pet cats have become gentler, and their personalities are more like dogs. Why do you think this is?
Actually, these two phenomena are not coincidences but deliberate outcomes of breeding in the pet industry. Yes, these changes are human interventions. Why are such modifications being made? Because there is a critical shift happening in the domestic pet industry—it’s experiencing dual aging, where both owners and pets are aging.
You see, for elderly people, if a dog runs too fast, it can be hard to keep up. But if the dog’s legs were a bit shorter, it would be much easier for elderly owners to walk their pets. Similarly, a pet cat with a wild personality may not be very friendly to an older person. Making them more docile would make life easier.
Without pointing out these trends, it would be easy to overlook them, wouldn’t it?
In fact, the development of the pet industry can be divided into three stages.
Stage 1: Dual Youth Phase. This refers to a time when both owners and pets are young. Decades ago, this was the state in China, which led to a surge in demand for pet food and sparked a wave of pet-related businesses. But life inevitably ages, and so we move into Stage 2.
Stage 2: Unilateral Aging of Pets. Pets live much shorter lives than humans, so before owners grow old, their pets will age first. This creates new demands in the pet industry, such as pet healthcare, veterinary checkups, and even pet funerals.
Stage 3: Dual Aging. This is when both the pets and their owners grow old simultaneously, happening alongside the general aging of society.
These stages do not progress in a simple, linear manner but overlap in different regions. Some areas may be in Stage 3, while others may be experiencing both Stage 2 and Stage 3. Regardless, the pet industry is constantly evolving.
So, what are the trends and new opportunities worth noting?
First, as human living spaces have changed, the pet industry must adapt. One important consumer group in the pet industry is college graduates. Many young people, two to three years after graduation, may feel it’s too early to get married but feel lonely living alone, so they start getting pets. However, at this stage, they may not own a home and are likely renting. This leads to several emerging needs.
For example, shared pet spaces, similar to pet daycare, have become a demand. If roommates don’t want a pet, placing the pet in a shared space becomes the best option. Moreover, China, like Japan, faces a challenge with smaller living spaces for people and pets, making it more difficult to keep large dogs, which further drives the development of small dog and cat economies.
Another trend is pet-friendly home renovations. In many Japanese furniture stores, custom furniture for humans and pets can be seen, such as cabinets with dog beds at the bottom, or tables with integrated cat walkways.
In other words, due to limited living space, the direction of pet product development is not focused solely on pets, but on human-pet cohabitation.
Another noteworthy trend is the rise of the “second-generation pet owners” among young people. Many of these individuals grew up with pets because their parents kept them. As a result, large numbers of “00s” and “10s” belong to this second generation. When this group begins earning money and living independently, it will bring a huge increase in demand for pet-related services.
Second, emotional services for the human-pet relationship.
For instance, holding a funeral for an electronic pet. Yes, electronic pets. In Japan, due to the physical limitations of elderly people, many have turned to robotic pets, like Sony’s Aibo. While robotic dogs are not new, holding funerals for these robotic pets is a relatively new concept. In 2015, there was even a collective funeral for old models of Aibo robots that had broken down and could not be repaired. The ceremony was held at Kōfuku-ji Temple in Chiba Prefecture, where the monks performed prayers. The emotional value was quite significant.
Another example is creating disaster preparedness guides for pets. In earthquake-prone Japan, there are many disaster calendars for humans, but none for pets. A pet-loving association created a disaster preparedness calendar for pets, listing evacuation points and pet-specific considerations. While the practical use of such a guide can be debated, the emotional value is clear. Pet owners feel they are showing love for their pets. This disaster calendar can be customized, making it an ideal promotional item for pet product companies.
In China, there are also some interesting services. For example, on Xianyu (Alibaba’s second-hand marketplace), there is a side job called “Bad Guy Performance” for pet sterilization. The idea is to have someone else take the pet for sterilization so the pet doesn’t associate the traumatic experience with the owner. This service is priced at 50-100 RMB per session and includes full video documentation.
Third, the dual aging of owners and pets brings changes to the industry.
For example, “one old and one young” services for pets. There are pet daycare services for young pets, and as pets grow older, they are provided with insurance. If a pet passes away, there are specialized pet funeral services. In Japan, pet funerals range from 20,000 to 150,000 yen, depending on the pet’s size. This is mainly because nearly 80% of people in Japan live in apartments, and many renters cannot bury their pets. The emotional needs of pet owners, combined with legal and social constraints, have fostered a demand for pet funerals in Japan. According to studies, 66% of pet owners in Japan opt for professional pet funeral services, creating a market worth 35 billion yen, which continues to grow.
Besides funerals, Japan has recently introduced end-of-life services for aging pets, which include specialized care and legal services to find new guardians for pets when their owners can no longer care for them.
As the co-founder of Pet Industry said, pets are like a mini version of human society, a world centered around “fur kids.” Therefore, adapting human life configurations to the pet economy offers significant growth opportunities.
And don’t forget, China’s market size is far larger, which means any of these trends will be amplified many times over here.
What we’ve discussed today are the opportunities within the pet industry. But, as you might have noticed, the pet industry is just a surface-level manifestation. What it truly reflects is people’s growing need for emotional fulfillment and a better quality of life.
