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Author Topic: $40 billion spent on Pets in America by doting owners SF Chronicle  (Read 2331 times)
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« on: October 09, 2007, 11:18:12 PM »

Article:Pets in America have $40 billion spent on them by dotin:/c/a/2007/10/09/MNNFS8O0V.DTL
Nancy Davis Kho, Special to The Chronicle

Tuesday, October 9, 2007

 How Americans treat pets has changed dramatically over the past decade or so. No longer do we relegate dogs and cats to life in the backyard eating table scraps. Sixty-three percent of cat owners and 42 percent of dog owners share their beds with their pets.

Pets are the focus of a huge commercial industry that tries to meet not only the basic needs of animals but the need of pet owners - or, as we say in the Bay Area, pet guardians - to reward their pets in ways meaningful in human terms.

The American Pet Product Manufacturers Association recently released its 2007-08 National Pet Owners Survey, finding that expenditures on pets in this country will top an estimated $40 billion in 2007. This is almost double the $23 billion spent a decade ago. Sixty-three percent of American homes include a pet, the highest level since the association began tracking statistics in 1988. Not surprisingly, cats and dogs are the most popular pet choices.

Bob Vetere, president of the association, said the increase in spending started in the mid-'90s and has continued. "Certainly post 9/11, the world is a scarier place for some people. People are looking for comfort, and that's something that a pet provides," Vetere said.

Ritu Raj, CEO of Wag Hotels, a premium boarding service for cats and dogs with locations in San Francisco and Sacramento, supports that theory but traces the takeoff to the dot-com bust of early 2000: "In the Bay Area the economy was shaken to the roots, and our pets became very important to us. These days it seems that we put more trust in our pets than in people."

Another factor is the Baby Boomer demographic. Vetere points out that "a lot of Baby Boomers have sent their kids off to college; we were doting parents, and now we're becoming doting pet owners." Vetere, himself a Boomer lavishing attention on his third golden retriever, said pet ownership used to drop off as people hit their 60s. "Now they hold onto their pets for longer," he said, perhaps mindful of studies showing therapeutic benefits of pets such as lower blood pressure, better heart health and lower health care costs. Given the size and spread of the Boomer demographic, with the younger members still a few years away from emptying their nests, Vetere believes the industry has another five to seven years of solid growth.

In the Bay Area, another influence might be the number of households without children, where a pet can quickly become the focus of nurturing - and spending. According to the 2000 census data, San Francisco has the lowest percentage of households with children among the 50 largest U.S. cities. Vetere said DINKs - dual income, no kid couples - are second only to Baby Boomers in pet ownership.

The size and growth of the pet product market has not gone unnoticed in other industries, particularly those catering to luxury markets. Vetere mentioned the availability of "a $5,000 diamond-studded dog collar from Cartier and matching Burberry umbrellas for you and your pet." One of the big sellers in the Wag Store affiliated with the hotel chain, according to Raj, is Sexy Beast, a "unisex blend of bergamot and vanilla-infused musk combined with natural patchouli, mandarin and nutmeg oils." Yes, it's for the dog.

Upscale stores like Bowlicious in the Stanford Shopping Center offer pet couture, freshly baked treats, toys, designer collars, leashes, fashionable totes and luxurious beds. Even more down-to-earth retailers like Old Navy, Lands' End and Sharper Image offer products intended for the pet.

Five years ago Lane Nemeth, an entrepreneur who founded Discovery Toys and sold it to Avon in 1997, had an epiphany during a visit from her grown daughter, who had a 3-pound puppy in tow. "We went shopping for my grand-dog, and I realized that the market was hugely underserved. None of the pet products we saw looked inviting or appealing," Nemeth said. "I realized that dogs have similarities to human 2-year-olds: They are curious, they are easily bored, they put everything in their mouths."

Thus was born PetLane, the Concord-based direct-sales company catering to pets and their owners. Drawing on her experience at the toy company, founder Nemeth designed her first products. She now has a network of 750 pet advisers selling PetLane products through home "PAWtys" (a la Tupperware) in 30 states. PetLane's best sellers, like the Kitty Chianti bottle and the dog's Sensory Star, are designed to provide sensory stimulation and stave off boredom. PetLane has also developed its own brand of pet food made with American grown, human-grade and FDA-approved ingredients.

During the pet food recall earlier this year, her customers were spared the worry about whether their dogs and cats were affected by tainted food, she said.

David Finder is the owner of Red Hound, a pet store in the Rockridge neighborhood of Oakland. Like Nemeth, he sees his business growth coming not from people shopping for kitty tiaras and matching jogging suits, but from conscientious pet owners looking for higher-quality food and toys. "There's so much more high-quality dog food now, made from human-grade ingredients," he said. Finder agrees that more of his customers now view their pets as part of the family, which may explain why they are hesitant to feed them food considered inedible by human standards.

The improved quality of life for pets extends to how we care for them in our absence. Raj's Wag Hotel is one of a number of Bay Area businesses, like Citizen Canine in Oakland and K9 Country Club in Petaluma, that provides day care or extended care for animals. In the case of Wag Hotels, dogs can enjoy play groups, a swim in the pool or a massage before retiring in private rooms, which range from small to a luxury suite. Wag also offers a Cattery with sleep sac beds for as many as 35 cats. Belying the stereotype that cats prefer solitude, Raj said, "The Cattery is always full in our San Francisco location."

This kind of attention doesn't come cheap: A no-extras room at Wag for a small dog starts at $28 per day and can range as high as $120 when amenities like premium food and individual play time are added. But those who use Wag's services say it's worth it.

Chris Hieb, who runs mergers and acquisitions for Oppenheimer Funds in San Francisco, sends his 7-year-old German shepherd, Lena, to Wag every day while he and his wife are at work. "Dogs need that socialization; smart dogs need to be worked and played with so they don't get into destructive behaviors," Hieb said. He feels fortunate to have the means to send Lena, whom he considers an important part of his life, to Wag. "There's a marked difference in her behavior and health with the day care," he said.

Improved quality of life extends to veterinary care. Even discounting purely cosmetic procedures like canine eye lifts and rhinoplasty, dizzying advances in veterinary diagnostics and treatments over the past 10 years have made formerly fatal conditions like canine melanoma treatable. But that means facing potentially huge costs and testing the boundaries of the intention to treat pets as family members.

Dr. Gary Richter of Montclair Veterinary Hospital in Oakland said, "I occasionally hear someone going on about how inflated the cost of veterinary care has become in the past five or 10 years. Those people rarely seem to discuss the differences in available care between then and now."

Hieb said that when he and his wife were living in Atlanta, Lena developed "hot spots." "We had her tested, and it turned out that she had more than a hundred allergies," he said. The vet made up a serum administered to the dog in a weekly shot. "It was a lot of money," Hieb recalled. "Let's put it this way: I've probably spent more on Lena's health care than I have on my own. But it was the right thing to do." (Since the move to the Bay Area, Lena's allergies seem to have decreased.)

It's a conundrum for a loving pet owner. Tom Turner, who lives in Oakland with his 9-year-old Australian cattle dog, River, said, "I love my dog. But to me, he only has a certain lifespan. When you hear about people paying thousands and thousands of dollars for surgery on their pet rats, it just doesn't seem right to me." That said, when his dog's vet bills ran into the $3,000 range this year, he and his wife, Jennifer, canceled a vacation in order to pay for River's care.

One way to cover spiraling veterinarian costs - $19.7 billion in the manufacturers' survey - is to buy pet insurance. VPI Pet Insurance, the largest and oldest pet insurance provider in the country, said Californians represent the largest segment of its customers. Brian Iannessa, VPI spokesman, said, "The Golden State represents about 20 percent of our new business. Last year, California was responsible for over 32,000 new VPI Pet Insurance enrollments." Iannessa believes Californians are early trend adopters. "Within the past three to five years, it's been moving closer to a critical mass in terms of consumer awareness," he said.

Of course, there are still pet owners who keep their pets off the beds (at least while they're watching), dress them only in what nature provided, and refuse to invest $20 in the Nature's Instinct Tiki Takeout for their parakeet.

However, with the improved products and services out there, it may be time for old pet owners to learn some new tricks.

For an audio slideshow on San Francisco's dogs and more pictures of how we spend money on our pets, go to

By the numbers
Americans love their pets, according to the American Pet Product Manufacturers Association:

8.3 million cats; 74.8 million dogs; 142 million freshwater fish; 24.3 million small animals; 16 million birds; 13.8 million horses; 13.4 million reptiles; 9.6 million saltwater fish.

63 percent

American homes with pets

$40 billion

Amount Americans will spend on pets this year

American Pet Products Manufacturers Association (APPMA):, (203) 532-0000

Wag Hotels,, (888)-924-5463

PetLane,, (888)-870 8324

Red Hound, (510) 428-2785

Citizen Canine,, (510) 562-1750

K9 Country Club,, (707) 776-4816

VPI Pet Insurance,, (888) 899-4874

Montclair Veterinary Hospital,, (510) 339-8600

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