Report: US Pet Supplies Spending Rises $8.65B in 2021, Reaches $23.81B

Glenn Polyn//November 30, 2022//

Report: US Pet Supplies Spending Rises $8.65B in 2021, Reaches $23.81B

Glenn Polyn //November 30, 2022//

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During his examination of spending in the pet industry, John Gibbons, the Pet Business Professor and president of A GPS for Pet Businesses, recently reported that total pet spending grew to $99.98 billion in 2021, up $16.23 billion (+19.4 percent) from 2020, the biggest increase in history. In a big turnaround, the supplies segment led the way with a $8.65 billion (+57.0 percent) increase to $23.81 billion.

(Note: All numbers in this report come from or are calculated by using data from the U.S. Bureau of Labor Statistics Consumer Expenditure Surveys.)

Spending plummeted in 2019 and 2020,  down -$4.6 billion due to Tarifflation and the pandemic. In 2021, with lower prices and an easing of restrictions, spending turned up sharply in the first half then skyrocketed up in the second half. Gibbons dives into the data to try to determine what and who are behind the explosive growth in supplies spending in 2021.

In 2021, the average household spent $178.20 on supplies, up 54.3 percent from $115.52 in 2020. Meanwhile, a 2021 pet consumer unit (CU) (68 percent of all CUs) spent $262.06. This doesn’t exactly match the 57.0 percent total spending increase. Here are the specific details:

  • 1.8 percent more CUs
  • Spent 40.7 percent more 
  • 9.7 percent more often

Let’s start with a visual overview. The chart below shows recent supplies spending history.

(click to enlarge)

Since the great recession, spending in the supplies segment has been driven by price. Although many supplies are needed by pet parents, when they are bought and how much you spend is often discretionary. When prices fall, consumers are more likely to buy more. When they go up, consumers spend less and/or buy less frequently.

The year 2014 was the third consecutive year of deflation in supplies as prices reached a level not seen since 2007. Consumers responded with a spending increase of over $2 billion. Prices stabilized and then moved up in 2015.

In 2015 we saw how the discretionary aspect of the Supplies segment can impact spending in another way. Consumers spent $5.4 billion for a food upgrade and cut back on supplies. Consumers spent 4.1 percent less, but they bought 10 percent less often. That drop in purchase frequency drove $1.6 billion (78 percent) of the $2.1 billion decrease in supplies spending.

In 2016, supplies’ prices flattened out and consumers value shopped for their upgraded food. Supplies spending stabilized and began to increase in the second half. In 2017, supplies prices deflated, reaching a new post-recession low. The consumers responded with a $2.74 billion increase in supplies spending that was widespread across demographic segments. An important factor in the lift was an increase in purchase frequency which was within 5 percent of the 2014 rate.

In 2018, prices started to move up in April and rapidly increased later in the year due to the impact of new tariffs. By December, supplies prices were 3.3 percent higher than a year ago. This explains the initial growth and pull back in spending.

In 2019, we saw the full impact of the tariffs. Prices continued to increase. By year-end, they were up 5.7 percent from the Spring of 2018 and spending plummeted -$2.98 billion. The major factor in the drop was a 13.1 percent decrease in purchasing frequency.

The pandemic hit in 2020. Prices deflated but with retail restrictions and the consumers focus on needed items, both the amount spent and frequency of purchase of supplies fell.

In 2021 the recovery began with a strong lift in the first half that reached record levels in the second half. Pet parents bought all the supplies that they had been putting off for two years because of Tarifflation and the Pandemic. It was the greatest lift in history, but 2021 spending ended up where it was headed in 2018 before being “derailed” by outside influences.

That gives us an overview of the recent spending history. Now let’s look at some specifics regarding the “who” behind the 2021 lift. First, we’ll look at spending by income level, the most influential demographic in Pet Spending.

(click to enlarge)

National: $178.20 per CU (+54.3 percent) – $23.81 billion – Up $8.65 billion (+57.0 percent).

All big income groups spent more but the 50/50 spending divide increased astronomically from $92K to $114K.

  • <$30K (25.5 percent of CUs)- $76.26 per CU (+33.0 percent) $2.62 billion – Up $0.69 billion (+35.9 percent). This group is very price sensitive, but their big spending lift finally put them ahead of 2016 spending despite the fact that they have 15 percent fewer CUs.
  • $30K>70K (29.7 percent of CUs)- $123.83 per CU (+27.2 percent) $4.91 billion – Up $0.94 billion (+23.6 percent). This big, lower income group closely matches both the national pattern and that of the $150K+ group. Tarifflation had a big impact, but COVID and the recovery were less pronounced. Amazingly, until 2019, they were the leader in total supplies spending.
  • $70>$100K (14.8 percent of CUs) – $160.38 per CU (+36.3 percent) – $3.18 billion – Up $0.86 billion (+37.2 percent). This middle-income group had been consistent in Supplies spending. 2020 hit them hard but they too rebounded stronger than the drop.
  • $100K>$150K (14.2 percent of CUs) – $229.43 per CU (+56.7 percent)- $4.35 billion – Up $1.59 billion (+57.6 percent). This high-income group had the second biggest COVID drop and traded supplies spending for food and veterinary. In 2021, they had the second strongest recovery.
  • $150K> (15.8 percent of CUs) – $415.37 per CU (+83.9 percent) $8.75 billion –  Up $4.57 billion (+109.2 percent). The more money that you have. The more that you can spend. The $200K> segment almost tripled their supplies spending in 2021.

Every big group spent more but the biggest increases came from higher incomes. Only the $40>49K group spent less in 2021 but they had spent 25% more in 2020 so they returned to pre-pandemic 2019 spending… but with 9 percent fewer CUs.

Now, we’ll look at spending by age group.

(click to enlarge)

National: $178.20 per CU (+54.3%) – $23.81 billion – Up $8.65 billion (+57.0 percent).

It’s simple. Under 25 spent a little less. Over 25 spent a lot more.

  • 35>44 (17.2 percent of CUs) $312.65 per CU (+120.3 percent) – $7.17 billion – Up $4.0B (+126.3%) This group is second in income and overall expenditures. The strong inflation drove spending down in 2019, but the pandemic had little additional impact. Spending skyrocketed in 2021 as 2.8 percent more CUs spent 92.6% more, 14.4 percent more often.
  • 55>64 (18.5 percent of CUs) $180.26 /CU (+65.5 percent) – $4.46 billion – Up $1.73B (+63.2 percent). When prices turned sharply up in the second half of 2018 and 2019, spending stalled then dropped. Spending fell again in 2020 as they binge bought pet food. They had a strong recovery in 2021 as 1.4 percent fewer CUs spent 51.2 percent more on supplies, 9.5 percent more often.
  • 45>54 (16.7 percent of CUs) $186.48 per CU (+27.4 percent) – $4.15 billion – Up $0.85 billion (+25.6 percent). Except for 2019 and now 2021, this highest income age group had been the leader in Supplies spending since 2007. They came back from the pandemic drop but now are in third place for supplies spending. That’s 1.5 percent fewer CU’s spent 24.4 percent more, 2.4 percent more often.
  • 25<34 (15.7 percent of CUs) $177.00 per CU (+32.9 percent) – $3.72 billion – Up $0.93 billion (+33.2%). After trading supplies spending for upgraded food and vet care in 2016, these Millennials turned their attention back to supplies. The rising prices hit them hard in 2019 but they actually increased spending in the pandemic. The lift grew even stronger in 2021 primarily due to increased purchase frequency. That’s 0.2 percent more CUs spent 9.7 percent more, 21.1 percent more often.
  • 65>74 (16.1 percent of CUs) $130.28 per CU (+35.6 percent) – $2.80 billion – Up $0.83 billion (+42.5 percent). This older group is very price sensitive so rising prices caused them to cut back on spending in 2019. Like the 25>34-year-olds, they also increased spending in 2020 and spending soared in 2021. However, it was not due to increased frequency. That’s 5.1 percent more CUs spent 32.0 percent more, 2.7 percent more often. Their purchase size was radically higher.
  • 75> (10.9 percent of CU’s) $67.13 per CU (+56.0 percent) – $0.98 billion – Up $0.34 billion (+53.7 percent). This lowest income group is truly price sensitive and their spending was severely impacted by the Pandemic. They had a strong recovery in 2021 but didn’t quite make it back to their 2018 level. That’s 1.4 percent fewer CU’s spent 22.8 percent more, 27.1 percent more often.
  • <25 (4.9 percent of CUs) $80.11/CU (-27.6 percent) $0.53 billion – Down $0.03 billion (-5.1 percent). Most moved out of their parents homes but their average CU spending fell a lot. That’s 31.1 percent more CUs spent 15.8 percent less, 14.8 percent less often.

The COVID recovery was widespread and spectacular. Only <25 spent less and the performance of 35>44 was amazing.

Next, let’s take a look at some other key demographic “movers” in 2021 ,pet supplies spending. The segments that are outlined in black “flipped” from first to last or vice versa from 2020. The red outline stayed the same.

(click to enlarge)

In 2019, in nine of 12 demographic categories all segments spent less on Supplies. In 2021, in nine categories all segments spent more. Also in 2019, 97 percent of 96 demographic segments spent less. In 2021, 97 percent spent more. Quite a turnaround.

Most of the winners and many losers are in their “usual” spot. Quite frankly, there are no surprises. There were six flips. Five were from last to first. Five segments held their position from 2020. Four of them were winners. This chart clearly shows that 2021 was an incredibly positive year for pet supplies spending. Your race or ethnicity, where you lived, how you lived, the makeup and size of your household, your occupation or whether you even had a job didn’t matter. All of the segments in these demographic groups had 1 shared behavior. They spent more on supplies for their pet children.

The $8.65 billion increase in supplies spending was the biggest in history, beating the $3.1B lift in 2008 but should it have been expected? Supplies is a discretionary segment, so it is more susceptible to market factors, especially inflation changes, than the more needed segments. Prices deflated from 2016 to 2018, resulting in a $5 billion increase. Then came Tarifflation and the pandemic and spending fell -$4.6 billion. What if these two outside events had never happened? Where would we be in supplies spending? The annual growth rate for supplies from 2015 to 2018 was +9.9 percent. From 2018 to 2021, it was +6.6 percent. A 10 percent growth rate would be difficult to maintain so it is not surprising that despite the big lift, the supplies growth rate has fallen. We shouldn’t be surprised by the massive spending lift. Supplies are discretionary, primarily in purchase frequency. Most are still needed. In 2021, pet parents just bought the supplies that they have needed for the past two years. The current big, unanswered question is how will the high inflation rates in 2022 affect supplies spending?


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