Buyout Shows Americans' Appetite for Pricey Pet Food
Mars is acquiring the pet food brands of P&G for $2.9 billion.
April 10, 2014 — -- Candy-maker Mars this week showed it has a sweet tooth for dog food: It will spend $2.9 billion to acquire three upscale pet food brands from Proctor & Gamble -- Iams, Eukanuba and Natura.
The move illustrates two trends: Americans are spending more on pet food, and they are willing to pay a premium for the kind of food they, themselves, would like to eat.
P&G selling pet food brands to Mars for $2.9B
Kobe beef dog food? It's out there, available on Amazon, at $41.54 for 12 cans.
"Kobe Master" is made by small, independent, boutique pet food producer WeRuVa (slogan: "people food for pets").
Its blurb for Kobe Master says, "Spoil your dog with the highest quality beef in the world. Kobe Beef is a legendary Japanese delicacy."
The dog food is rich in Omega 3 and Omega 6 fatty acids, says WeRuVa. It is safe and natural, owing to the fact that Kobe beef is raised on an all-organic diet in a hormone- and antibiotic-free environment.
Nutro, a brand Mars already owns, offers the discerning canine diner a lamb-and-rice kibble made with genuine New Zealand lamb.
"It's one of our top sellers," says Nutro spokesperson Monica Glass. It's also gluten-free. Price: $15.99 for a 5lb bag.
Iams, which Mars is buying, makes dog food imbued with Vitamin E, Glucosamine, L-Carnitine and Prebiotics.
New York City market research company Packaged Facts says total pet food sales are projected to reach $21 billion in 2013, and $24.7 billion by 2017. Sales of premium pet food (anything priced 10 percent above pet food overall) was 42 percent of total sales in 2012. Its share is expanding, says Packaged Facts, because of robust growth in the "super-premium" category.
Dogs in particular are getting pampered the most. Premium dog food including pricey organic offerings and never-frozen meals has grown by nearly 170 percent over the past 15 years, according to Euromonitor, topping the market for medium- and low-priced varieties combined. Back in 1999, the most expensive dog chow accounted for 36 percent of the market, and now it’s 57 percent, or more than $6.5 billion a year.
What are consumers (and their pets) getting for all that money?
When you are standing in the pet food aisle, debating whether to buy Cirque de la Mer dog food with whole, wild-caught tuna (a real brand) or the cheapest brand ("Old Cur," which we just made up), what facts ought you keep in mind?
For starters, say experts, you should know that whatever you are buying is almost certainly better for your dog than what you could cook for him or her at home.
That's because, says Marion Nestle, Paulette Goddard professor of nutrition, food studies and public health at New York University, commercial pet food (unlike commercial food made for humans) is by industry custom complete and nutritious.
"It all has to meet the same standard," she says.
A dog who eats commercial dog food doesn't need to eat anything else. If the can says "complete and balanced," says Nestle, what's inside is.
Second, if you spend more, your dog will not necessarily be happier or better nourished.
While there is plenty of anecdotal evidence, says Nestle, suggesting that better quality, more costly ingredients provide superior nutrition, there are no scientific studies proving so.
"Ninety percent of pets live on the cheapest pet food and survive," says Nestle, co-author of "Feed Your Pet Right: The Authoritative Guide to Feeding Your Dog and Cat."
Yes, but what about taste? Isn't the $25 pouch of caviar-and-honey kibble more savory than the plain old thing?
To you, maybe. But not necessarily to your dog.
Such concoctions, says Cailin Heinze, VMD, assistant professor of nutrition at Tufts University's Cummings School of Veterinary Medicine, are created to appeal to the human buyer, not to the tail-wagging end-user. There is no correlation, she says, between price and canine taste-appeal.
Heinze, who grew up on a farm, formed an understanding of what dogs like to eat early on.
"The dogs I grew up with," she says, "ate road kill or horse poop. That's what they liked best."
Dogs, says Dr. Heinz, "have a different sense of taste."
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Professor Nestle concurs.
"The more disgusting it is to humans," she says, "the more dogs like to eat it. They like rotten meat flavors. They like garbage."
They will, she says, eat their own waste -- and enjoy it.
It's worth considering how delicious (to your dog) dog food ought to be. Given the epidemic of pet obesity in the U.S., say experts, a little less deliciousness might not be a bad thing.