Market Trends of Indonesia Pet Food Industry
Pet Humanization is Influencing the Purchase Decision
Pet humanization is a result of rising income, changing demographic patterns, and consumer preferences. Though the per capita GDP of the country declined by 2% due to the Covid-19 crisis in 2020, the pet industry witnessed growth due to the behavioral change that occurred during the lockdown period. There has been a shift toward pet ‘parenting’ from ‘ownership’, which influenced the purchasing decisions of pet products. Furthermore, the rise in income led to more imports of pet foods for retail sale in Indonesia. Consumers demanded clearly defined clean labels due to increasing health consciousness for their pets. Currently, pet owners are resolute about knowing the food constituent information of the various pet food products. As a result, some pet food companies claim transparency in the sourcing and processing of ingredients. As consumers become progressively more concerned about their health, particularly in relation to their diet, similar concerns about the diets of their pets are increasing significantly. Furthermore, they highly prefer natural and organic products. Owners who are highly involved with their pets spend a large amount on pet food and other pet care products. Moreover, in Indonesia, the growth of premium and super-premium pet foods is primarily driven by the humanization of pets.
Import is Dominating the Indonesian Pet Food Market
According to the International Trade Centre (ITC), in 2020, the import of pet food in Indonesia was valued at USD 119.8 million. Thailand, China, France, and the United States are the major exporters of pet food in Indonesia for retailing, with Thailand holding 70% of the export. The import from Thailand increased by 22.1% in 2020. The Indonesia Pet Food Market comprises 95% of the international brands, and only 5% of the share goes to the local players in the region. As pet food generally contains products of animal origin, its production facility must be approved by the Ministry of Agriculture, c.q. Directorate General of Livestock and Animal Health Services before an importer can import from the pet food producing facility. There is an increasing trend for high-income consumers to feed their pets nutritionally balanced raw food diets. An increasing number of premium brands entered dog food in 2018, attracted by the sales potential offered by the intensifying humanization and premiumization trends. Black Hawk brand from Australia, which has a natural positioning and is produced using premium ingredients such as hormone-free chicken and pasture grazed lamb, entered the Indonesian Pet food market in late 2018.
