I never quite understood people's obsession with their pets but that was until I got a pet of my own. Now I totally understand people's willingness to spend on their furry best friend and that is what we're covering today in this week's ONE THING.

The pet industry is a $150 billion industry and that number is expected to continue increasing, especially now when people have more time to bond with their companion animals during the lockdown. 

🚨 Signals

• US spending on pets reached almost $100 billion in 2020 and according to the APPA, owners spend an average of $1,380 for dogs annually 
• E-commerce in pet care is expected to post a CAGR of 9%
• VC interest in pet-focused companies has grown 29.5%, $65 million has been raised in the first 3 months of 2021
• The entire industry is driven by a single underlying trend, the humanization of pets

🔨 The Opportunities

1. Premiumization with humanization. 

• Gone are the days of dry kibble. People have become more aware and cautious of what food they put in their pet's body, even more so than the food they put in their body
• While the pet food industry is an enormous one, it's also a highly competitive one, with big brands dominating most of the market share
• But there is still some meat left on the bone (no pun intended). You could create a DTC brand and sell fresh, premium personalized pet foods. You could also focus on special treats for occasions like birthdays or the new years etc.

2. Doggy Day Care

• Demand for daycare will soar when people start trickling back into the office post-pandemic
• You will have two groups of people post-pandemic: one group of people who will need to go back to the office and another group that will have the option to work from home. You could connect pet owners with the second group of people and offer at-home pet services

3. Pet Insurance

• What's Berkshire Hathaway's biggest cash cow? It's undoubtedly their insurance group. Well now here's your chance.
• Trupanion is a public traded pet insurance company in the US. Their revenue has grown from $55.5m in 2012 to $384m in 2019. The 2 primary factors for their success: high retention rates and a vastly under-penetrated market
• The pet insurance industry is still largely untapped. With the right execution and the effective distribution channel, you could very likely gain a strong foothold in this space

Before you go...

Here's a picture of my corgi 😊

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