According to a research report released by Gf Securities, China's urban pet (dog and cat) consumption market size is projected to reach approximately 312.6 billion yuan in 2025, representing a 4% year-on-year increase from 2024. The growth rate of the cat consumption market surpasses that of the dog market, at 5% and 3% respectively. With the overall pet industry growing at an annual rate of 4% in 2025, the market's sustained expansion is primarily driven by new pet owners and an increase in average spending per pet. A retrospective analysis indicates that category and channel dividends have been key drivers of changes in the competitive landscape. At present, significant opportunities exist in the burgeoning functional food product segment. Companies with strong research and development capabilities and robust sales networks are well-positioned to enhance the penetration of new product categories and lead industry trends. The main viewpoints of Gf Securities are as follows:
The overall sales growth of pet goods is robust, with new pet owners and rising per-pet spending acting as the primary drivers for the industry's continued expansion. According to the China Pet Industry White Paper, the consumption market size for urban pets (dogs and cats) in China is expected to be around 312.6 billion yuan in 2025, a 4% increase compared to 2024. The cat consumption market is growing faster than the dog market, with growth rates of 5% and 3% respectively. The main drivers of industry growth stem from the influx of new pet owners and the upward trend in average expenditure per pet.
The preference for domestic brands continues to rise, yet brand competition remains intense. Shifts in the brand landscape are being propelled by dividends in product categories and sales channels, allowing outstanding domestic brands to capitalize on these trends. The China Pet Industry White Paper shows a consistent increase in preference for domestic brands in recent years. In 2025, the preference for domestic brands in cat and dog staple food reached 38% and 35% respectively, up from 16% and 20% in 2022. Examining the evolution of China's pet food industry over the past decade reveals it has experienced several红利 phases: the e-commerce红利 (2018), the cat economy红利 (2020), the Xiaohongshu (Little Red Book)红利 (2023), and the Douyin (TikTok)红利 (2024). For brands to achieve breakthrough growth, they must adeptly seize the opportunities presented by shifts in channels and categories. Compared to foreign brands, leading domestic brands have demonstrated greater agility in responding to changes in product categories and sales channels within China's pet food market, consequently enhancing their market share and industry influence. Coupled with improvements in their own product quality, recognition of domestic brands has seen a notable rise.
Competition in the baked pet food category is intensifying, positioning functional food as a potential blue ocean for growth. Consumer preference for baked and freeze-dried-added pet foods has now surpassed that for extruded kibble, according to the Pet Industry White Paper, while preference for fresh pet food and main-course wet food has increased in recent years. The supply of baked pet food products is becoming relatively saturated, leading to a decline in product efficiency. Staple foods with specific health benefits are emerging as a new product trend. Functional pet food is not a novel concept, with prescription diets being the most typical example; functional foods are positioned to offer some benefits of prescription diets but are intended for daily use by healthy pets. Current product trends indicate that weight management, urinary tract health, digestive health, skin/coat care, and senior-specific formulas are the five core functional staple food categories. International brands (such as Royal Canin, Hill's, and Purina Pro Plan) have an early-mover advantage in prescription and functional staple foods, boasting mature product lines. Domestic brands (like Oriental Aulong) are gradually increasing their efforts. In the pet health supplement sector, domestic brands already have a comprehensive presence, with major players including Red Dog, Myfoodie, and Vits.
The focus of channel transformation should be on new instant retail channels. According to Pet Industry Insider, the market shares for Tmall/Taobao, JD.com, Douyin, and Pinduoduo are approximately 29%, 9%, 9%, and 10% respectively. O2O instant retail, which integrates offline physical locations with online channels, is currently in a high-growth红利 phase, with rapid growth rates observed across various product categories within this channel.
Potential risks include fluctuations in raw material prices, intensifying market competition, sales performance falling short of expectations, and delays in planned capacity utilization.