In October last year, Woolworths announced that it had acquired 93.5% of Absolute Pets – a chain of retailers selling pet food, toys, healthcare goodies and accessories.
It’s no secret that the pet category is growing quickly in South Africa. In 2022, the market was estimated to be worth more than R7 billion. That same year, we showed how 22seven users who owned pets spent an average of R1,213 per month on their upkeep. That figure has certainly increased.
Despite the range and variety of pet products having expanded exponentially in recent years, the market remains fragmented and therefore attractive to bigger retailers who are jumping at the opportunity to build out chains of pet stores and consolidate consumer spending.
The Shoprite group was first in 2021, when they launched their stand-alone Petshop Science stores. And now Woolworths has joined the fray, hoping Absolute Pets will accelerate the retailer’s existing pet strategy.
To analyse the merits of this strategy, we did a deep dive into the spending habits of 22seven pet lovers at more than 360 pet and vet stores nationwide – not just the ones that sell food, healthcare, grooming and play products, but also services like grooming and kennels. (Unfortunately, we don’t have a view of how much is spent on pet food bought directly from grocery stores and other general retailers.)
The objective of our research is twofold: to help our clients better understand the business that Woolworths has acquired; and to contemplate what that business might become by analysing the market in which it operates.
Prime my pup
Let’s start with Absolute Pets as a standalone entity. It’s an impressive business – by far the largest specialist pet retailer that we can identify from the 360+ pet and vet stores frequented by 22seven users. Accounting for 29% of total pet spend over three months to December 2023, Absolute Pets is 3.8x the size of its next largest competitor: petzone, part of the West Pack Lifestyle group.
The chart below shows the nine largest pet retailers by spending share. Together, those nine account for c70% of total spending on pets. The remaining retailers account for c30% of spending share, demonstrating just how fragmented the market is. (Absolute Pets accounts for the same percentage as the entire ‘Other’ category, made up of 300+ smaller stores, vets and pet services.)
But wait, there's more...
The full report is available to clients – showing comparative spending across the major pet retailers and where Woolworths might be able to find real growth in its acquisition. If you would like the full picture, contact us to learn how you can pay for research via your broker or subscribe directly.
