02.16.09

Financial Crisis Dogs Pet Industry

Canine mineral water! Parrot outerwear! Capitalism was running amok at this week’s Global Pet Expo. But look closely, and you could see that the sour economy was hounding even our four-legged friends.

Lehman Brothers may be dead and GM may be reeling, but the Global Pet Expo is going strong. On Friday, the second morning of the gargantuan trade show in Orlando, Florida, I was standing in the Parrot Wrapz booth listening to the brother-and-sister team of Jesse and Bonnie Scheflin explain how it was that they decided, in the maw of the great recession, to start manufacturing outerwear for parrots. “We were going to relocate to Colorado,” Bonnie says, “and all I cared about was, ‘Oh my God, how are we going to keep the parrots warm?’”

There’s a firm selling glow-in-the-dark mice—they’ve been implanted with a jellyfish protein—around the corner from the designer offering nickel-plated porcelain water bowls and the freeze-dried raw New Zealand lamb dinner brand.

Eureka! Forty seamstresses later the Scheflins settled on a parrot suit whose oblong holes fit over the bird’s wings and whose colorful designs include logos of football teams, camouflage, and tartan. The Global Pet Expo is their big debut. The chain-store buyers prowling the floor, Bonnie says, are interested. “You can dress your dog and you can dress your cat, but there’s nothing for parrots. Until now.” She pointed to the outfits emblazoned with avian-specific catch-phrases—i.e., Do These Feathers Make Me Look Fat? “This really reflects their personalities.”

Laugh if you will. But in this year of extreme hardship, someone has to have some faith. By the time you got to the obscure patches of the multi-acre Global Pet Expo show floor, you tended to have had a lot of such conversations: A bright idea, a lot of elbow grease, and a limitless belief in Americans’ willingness to buy for their animals even as they scrimped for themselves. The pet industry appears to be weathering the storm. Show organizers say prepaid attendance is actually up over previous years. “We’re as recession-resistant as any industry I can think of,” says Bob Vetere, whose American Pet Products Association hosts the annual show.

Thus, as if I’d stepped into a pre-crash time capsule, I can report that I have seen dog beds in the shape of giant Crocs clogs. I have examined toys that promise mental enrichment for fishes. I have listened to all sorts of promises about the organic, all-natural, holistic, and/or human-grade ingredients in a vast range of new pet foods. I have looked over high-tech dog collars loaded with a behavior-regulating pheromone. I have seen Chinese herbal veterinary medicines whose come-ons tout “ancient wisdom…proven results.” I have met a man who says he used to be the world’s biggest manufacturer of Glad-Bag cartons and watched him work the floor in the name of his new product: doggie smoothies.

And I found myself sufficiently sucked into the spectacle’s envelope-pushing technology that I really wanted to ask follow-up questions of the man carrying a box marked “URINE OFF: THE NAME SAYS IT ALL.”

I had, in other words, a very successful couple of days at the Global Pet Expo.

As measured by media attention, Global Pet Expo was only the second-biggest pet-oriented event of last week. But unlike the Westminster Dog Show, the trade fair allows us to accurately assess the state of our modern pet-crazed country. For years, the American pet industry has been growing like a six-month-old lab. Estimated at $23 billion a decade ago, it did $41 billion in business in 2007. The trade shows have grown with it. Two years ago, actors dressed as Roman centurions rolled out a new line of dog treats. Last year, in San Diego, the show filled 2,400 booths as visitors jostled for space in front of displays of canine mineral water.

With each year of uninterrupted growth, industry boosters sounded increasingly confident that their business was immune from the laws of gravity. Pet spending didn’t take a hit when the Internet bubble burst at the beginning of the decade. The logic: When times are tough, people pull close to family. The definition of family in recent decades has come to include the pooch who once dozed in the backyard. That bond—and the healthy food and proper training and aggressive vet care that four-legged ersatz children require—is hard to reverse.

Thus, even as the business pages filled with gloomy news, publicists breathlessly alerted press to new products that would be unveiled this week: “Pet Head’s new line of styling products will redefine the pampered pet.” “Jeep® Pet Products’ collection for dogs also includes the Jeep® Pet Ramp, Jeep® Rubicon Jogging Pet Stroller, Jeep® Wrangler Pet Stroller and Jeep® Pet Pen.” “Together the Toyota VENZA and the Kurgo aftermarket accessories make the VENZA the ultimate pet and pet owner’s vehicle.” (The auto industry thrives in petworld, if nowhere else.)

And yet it was hard not to worry. Pet owners may choose their animals over themselves, but what about those pets that didn’t have a choice? The foreclosure crisis has led to a spike in abandoned animals, as owners become renters and face pet-unfriendly landlords. Higher up the line, the recession-season inclination to shell out for pet nuturing hasn’t extended to pricey bling: Pet Fashion Week, whose annual August canine-couture shows have drawn big crowds in Manhattan, just canceled its scheduled expansion into spring shows.

Which means there was a lot riding on the central media event of Global Pet Expo, the trade group’s annual release of its sales figures. Along with scribes from Pet Product News and Pet Business, and Pet Style News, I waited earnestly as Bob Vetere, the show’s host, took the podium. Would the invisible hand finally yank the industry’s leash? Not yet. Vetere announced that industry spending in 2008 hit $43 billion, as projected. And in 2009, he predicted, it would grow by another few billion dollars. An industry’s self-generated estimate, sure, but few people on the sales floor were contradicting it. Selling chew toys beats selling real estate, even if growth hasn't slowed down.

So what is the pet recession? Well, boutique goods are off. Spending on Space Age vet interventions has flattened, meaning that owners might be willing to put the dog or cat to sleep a bit sooner. Services like grooming are slowing down. But pricey nutritious kibble is still solid, and, according to Vetere, the tough times have driven more spouses into the workplace, meaning more service spending has shifted to dog-walkers. “I’ve been doing this for 20 years and I’ve weathered the ups and downs,” says Jody Rogers, working the floor for Yöghund organic frozen yogurt. (“We’re the Activia for dogs,” she explains.) “We may level off a bit, but that’s it.”

Longer term, the industry is trying to expand its business by expanding the number of pets. After years of watching pet-coddling empty-nesters drive spending, the 2009 show features endless discussions of Facebook and Twitter and social-networking, part of an expansive scheme to make younger folks adopt animals. There’s a PR campaign stressing the health benefits of pet ownership. There’s talk of minority outreach, as non-whites are less likely to get pets. More pets, of course, means even more pet spending. “We’re going to be huge in the recovery,” Vetere says.

But even without the recovery, even before the new demographic outreach, you could still find a firm selling glow-in-the-dark mice—they’ve been implanted with a jellyfish protein—around the corner from the designer offering nickel-plated porcelain water bowls and a display for the freeze-dried raw New Zealand lamb dinner brand. It may be the best argument in the industry’s get-a-pet campaign: It makes a good way to muddle through a recession. “Alcohol, Netflix, and pets,” Vetere says. “That’s what’s doing well. It’s open a beer, put Fido on your lap, watch a movie.”

Michael Schaffer is a writer in Philadelphia. One Nation Under Dog, his book about petmania, the pet industry, and what modern petkeeping says about modern America, is available from Henry Holt. For more visit www.michaelschaffer.net.