2019 U.S. Pet Spending by Generation – Gen X CUs Still Spend the Most

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In 2019 Americans spent $77.44B on our companion animals, 0.94% of $8.3 Trillion in total expenditures. Pet Spending was down $0.16B (-0.2%), a marked change from 2 years of increases. There were a number of factors affecting pet spending in 2019. Food rebounded after the 2018 FDA warning on grain free dog food drove spending down. Tariffs on Supplies really hit home causing a huge drop in spending . Veterinary Services again had a small increase, but it was entirely driven by inflation. After the biggest lift in history, Services spending plateaued in 2019.

In this report we will look at how these factors and others affected the Pet Spending for today’s most “in demand” demographic measurement – by Generation. In 2019, we’ll see Gen Z for the first time and the oldest generations will be consolidated into 1 group. Using data from the US BLS Consumer Expenditure Survey we’ll look for answers.

We’ll start by defining the generations and looking at their share of U.S. Consumer Units (CUs are basically Households)

GENERATIONS DEFINED

Gen Z: Born after 1996

In 2019, Age under 23

Millennials: Born 1981 to 1996

In 2019, Age 23 to 38

Gen X: Born 1965 to 1980

In 2019, Age 39 to 54

Baby Boomers: Born 1946 to 1964

In 2019, Age 55 to 73

Silent/Greatest: Born before 1946

In 2019, Age 74+

  • Baby Boomers still have the largest number of CU’s at 43.1M and 32.6% of the total but they are losing ground. In fact, they have 1.9M fewer CU’s than in 2016.
  • The Oldest Generations will continue to lose CUs primarily due to death or movement to permanent care facilities.
  • Gen X has the second most CUs and are the most stable.
  • Millennials have the largest number of individuals, but they rank only third in the number of CU’s. Now, Gen Z appears for the first time. Together, these 2 youngest generations are growing fast, up 1.9M CUs in 2019.

Now let’s look at some key CU Characteristics

One significant change was the increase in homeownership. This was driven by the Gen Xers and Millennials and overcame a drop by Boomers. Separated from Gen Z, Millennial CU size also grew.

  • CU Size – CUs with 2+ people account for 69.8% of all U.S. CUs (down from 70.5% in 2018) and 78.2% of pet $ (down from 80.9% due to a spending drop by 2 person CUs and a lift by singles). Millennials are actively building their H/Hs. However, CU size, with all the related responsibilities, still peaks with the Gen Xers and then starts dropping. The Boomers are the last group with 2+ CUs but that will inevitably fade.
  • # Children < 18 – 27.9% of U.S. CU’s have children and they generate 29.0% of Pet Spending. Although Married Couples with children spent slightly less, CUs with children continue to earn their share. However, the story is more complex. Single parents spent $1.04B less, but the biggest decrease again came from Married Couple only CUs – down -$1.67B. Other “adults only” CUs, of any size spent significantly more on their pets, +$2.77B. Singles led the way with +$1.64B. Overall, there was no change in the # of children per CU in 2019 but there were changes within groups. Millennials, now separated from Gen Z, reported more children as did Gen X, while the number for Boomers was down. The Married with Children group tends to skew younger, but singles have higher numbers at both ends of the age range.
  • # Earners – While not as important as income, Pet spending is also tied to the number of earners in a CU. In 2019, 2+ person, 2 Earner CUs spent 52% more on their pets than 1 Earner CUs. As the chart shows, the “earning” is being done in America by the younger groups, peaking with Gen X and dropping significantly with the aging Boomers.
  • Homeownership – Owning and controlling your own space has been a major factor in increased Pet Ownership and spending. Driven by the younger groups, homeownership increased to 63.74% from 63.48%. There was a clear spending divide. Led by those with no Mtges (+$0.99B), Homeowners spent $1.13B more on their pets while Renters spent $1.29B less. As a result, the homeowners share of Total Pet Spending grew from 79.8% to 81.4%. One key to increased Pet Spending in 2019 was a paid off mortgage.
    • Gen Z are now the most common renters in society. Homeownership by Millennials has moved up to 43% but it is still only 67% of the national average and about 3/4 of the rate of Gen Xers and Boomers when they were the same age.
    • Gen Xers have been above the national avg since 2018 and Homeownership continues to increase with age.

Next, we’ll compare the Generations to the National Avg.:

In Income, Total CU Spending, Total Pet Spending and the Pet Share of Total CU Spending

CU National Avg: Income – $82,852; Total CU Spending – $62,949; Total Pet Spending – $593.51; Pet Share – 0.94%

  • Income – The Gen Xers are the leaders, but the gap narrowed with a 0.3% decrease. The Boomers earn 19% less but are the only other group to exceed the national avg. Income drops radically in the oldest group as they retire, and Gen Z is just getting started. Millennials’ income grew 12.8% but is less than the Boomers and only 75% of Gen Xers.
  • Total Spending – The Gen Xers make the most and spend the most but it’s not out of line with their income. Boomers also spend more than the average but their after tax income still supports it. The oldest & youngest groups are actually deficit spending in relation to their after tax The Millennials’ spending increased 8.2%, twice as much as Gen Xers. With increases in CUs, Income and Spending, the retail importance of Millennials is growing.
  • Pet Spending – Only 2 groups exceed the national average and for the second consecutive year, Gen X holds the top spot. Millennials are 3rd but are 26% below Boomers and 33% below Gen X. The oldest and youngest groups trail.
  • Pet Spending Share of Total Spending – The national number fell from 0.98% to 0.94%. The drop was due to a 10% decrease from Millennials/Gen Z and a 3% decrease from the oldest group. Gen X held their ground and Boomers are still the only group to spend more than 1% of their total on their pets. However, the most significant change is that in 2018 every group spent at least 0.92% of their total CU spending on their pets. In 2019 this minimum is down to 0.82%, with the youngest groups leading the way down.

Now, let’s look at Total Pet Spending by Generation in terms of market share as well as the actual annual $ spent for 2015 through 2019. The 2019 numbers are boxed in red (decrease) or green (increase) to note the change from 2018.

  • Boomers are still the biggest force in Pet Spending, but their share continues to fall – 36.6% from 46.8% in 2017.
  • There are definite age-related patterns which are readily apparent in the bar graph. Spending in the oldest group is relatively low and falling. In contrast, the two youngest groups are showing consistent year after year growth. The Boomers are in the middle. They still have the biggest share but are also the most likely group to have a strong reaction to trends, especially in this era of super premium foods. With their tremendous buying power, this can cause major spending swings impacting the whole industry. There was no swing in 2019 as their $ were down again.
  • In 2019, the Boomers spending fell -$0.88B and Silent/Greatest was down -$0.46. The Gen Xers and Millennials/Gen Z stepped up again, +$1.17B. However, they fell a little short.
  • Boomers – Ave CU spent $669.25 (-$2.78); 2019 Total Pet spending = $28.73B, Down -$0.88B (-3.0%)
    • 2015>2019: Down $3.42B; Their roller coaster stopped as spending continued down, now -10.6% from 2015.
  • Gen X – Ave CU spent $727.05 (+$18.73); 2019 Total Pet Spending = $25.75B, Up $0.59B (+2.4%)
    • 2015>2019: Up $7.49B; Their annual Pet spending growth since 2015 has been strong and consistent. Their increase of $7.49B in that time was just slightly behind Millennial/Gen Z.
  • Millennials + Gen Z – Ave CU spent $471.43 (-$15.42); 2019 Total Pet Spending = $17.50B, Up $0.58B (+3.4%)
    • 2015>2019: Up $7.77B; Their spending growth pattern since 2015 mirrors Gen X. However, they have the biggest increase in $, $7.77B, +80%.
      • Millennials Only – Ave CU spent $493.61; 2019 Total Pet Spending= $16.43B
      • Gen Z Only – Ave CU spent $280.09; 2019 Total Pet Spending= $1.07B
  • Silent + Greatest – Ave CU spent $388.85 (-$17.73); 2019 Total Pet Spending = $6.46B, Down $0.45B (-6.5%)
    • 2015>2019: Down $1.15B; They still spend a relatively high amount on their pets, but age is becoming a factor.

The older generations, including Boomers may be starting to fade as 2019 spending for both groups was below 2015. The younger generations are consistently increasing their annual spending which bodes well for the future.

Let’s look at the individual segments. First, Pet Food…

  • The trendy nature of Pet Food is more pronounced for the Boomers. In the older generations, pet ownership is fading. The younger groups are showing more consistent growth and Gen X led the way in the 2019 Food rebound.
  • The Millennials’ have led the way in food trends, including value shopping and they are the only group with an annual increase every year since 2015.
  • Boomers – Ave CU spent $294.51 (+$29.78); 2019 Pet Food spending = $12.56B, Up $0.78B (+6.6%)
    • 2015>2019: Down $3.01B– Spending plummeted in reaction to the FDA warning. The 2019 rebound fell far short.
  • Gen X – Ave CU spent $284.18 (+$50.13); 2019 Pet Food spending = $10.03B, Up $1.71B (+20.5%)
    • 2015>2019: Up $2.77B If this highest income group reacted to the FDA, it was to further upgrade their food.
  • Millennials + Gen Z – Ave CU spent $161.85 (-$12.91); 2019 Pet Food Spending $6.13B, Up $0.08B (+1.4%)
    • 2015>2019: Up $2.39B They are the only group with increased spending every year since 2015. They are growing in numbers and in their commitment to their pets. Since 2014 they have been the pioneer in food upgrades.
      • Millennials Only – Ave CU spent $171.55; 2019 Pet Food spending = $5.79B
      • Gen Z Only – Ave CU spent $34.76; 2019 Pet Food spending = $0.34B
  • Silent/Greatest – Ave CU spent $152.69 (-$10.70); 2019 Pet Food spending = $2.48B, Down $0.22B (-8.1%)
    • 2015>2019: Down $0.67B; They remain committed to their pets, but their numbers are starting to fade.

Pet Food Spending is driven by trends. In 2018, the FDA warning for grain free dog food created a turmoil. Boomers dialed back to more regular food. The younger groups were less affected. In 2019 It looks like Gen Xers may have upgraded to even more expensive varieties which helped fuel the big $ rebound. Now, let’s look at Supplies Spending.

  • Boomers still have the largest share but even with a $1.8B drop in spending, the younger groups have a big “presence” in Supplies. Gen Xers and Millennials/Gen Z together account for 55.8% of Supplies spending.
  • Baby Boomers – Ave CU spent $136.81 (-$20.00); 2019 Pet Supplies spending = $5.90B, Down $0.96B (-14.0%)
    • 2015>2019: Down $0.04B; Spending peaked 2017, then headed down probably due to the impact of tariffs.
  • Gen X – Ave CU spent $154.17 (-$38.03); 2019 Pet Supplies spending = $5.47B, Down $1.35B (-19.8%)
    • 2015>2019: Up $0.90B; Gen Xers generally perform best in Supplies and they are the leader in CU spending, but they too were affected by tariffs. They also further upgraded their Food and partially paid for it with Supplies $.
  • Millennials + Gen Z – Ave CU spent $118.17 (-$12.96); 2019 Pet Supplies spending = $4.34B, Down $0.23B (-5.0%)
    • 2015>2019: Up $1.11B; Supplies are still Millennials’ best performing segment. In 2016 they cut spending to fund increases in Food and Veterinary. They came back strong, +$1.8B by 2018 and were the least impacted by tariffs.
      • Millennials Only – Ave CU spent $118.64; 2018 Pet Supplies spending = $3.92B
      • Gen Z Only – Ave CU spent $114.01; 2018 Pet Supplies spending = $0.42B
  • Silent + Greatest – Ave CU spent $65.13 (-$23.94); 2019 Pet Supplies spending = $1.10B, Down $0.45B (-28.9%)
    • 2015>2019: Down $0.22B; Spending has been slowly increasing but this $ conscious group was hit hard by tariffs.

In 2016 most Consumers value shopped for the super premium food that they had upgraded to in 2015 and spent some of the saved money on Supplies. Supply prices dropped in 2017 and everyone under 72 years spent more! Late 2018 saw added tariffs. Boomers dialed back their purchase frequency. Everyone else was either unaffected or bought more, early. In 2019 the sharply rising prices drove spending down in all groups.

Next, we’ll turn our attention to the Service Segments. First, Non-Veterinary Pet Services

  • Gen Xers kept the top spot. The oldest group had the biggest increase, but the Gen X/Millennial share is still 56.0%.
  • Baby Boomers – Ave CU spent $64.50 (+1.51); 2019 Pet Services spending = $2.78B, Up $0.03B (+1.0%)
    • 2015>2019: Up $0.31B; Boomers still need Services. They held their ground after trending down for 2 years.
  • Gen X – Ave CU spent $85.60 (-$8.62); 2019 Pet Services spending = $3.04B, Down $0.31B (-8.1%)
    • 2015>2019: Up $0.92B; After the big lift in 2018, it’s likely that they looked for and found a better price.
  • Millennials + Gen Z – Ave CU spent $50.43 (-$4.28); 2019 Pet Services spending = $1.85B, Down $0.05B (-2.8%)
    • 2015>2019: Up $1.83B; Value shopping is also likely. The drop was less than Gen X because of 5+% more CUs.
      • Millennials Only – Ave CU spent $54.34; 2019 Pet Services spending = $1.80B
      • Gen Z – Ave CU spent $15.47; 2019 Pet Services spending = $0.06B
  • Silent + Greatest – Ave CU spent $56.38 (+$15.13); 2019 Pet Services spending = $0.95B, Up $0.24B (+33.0%)
    • 2015>2019: Up $0.31B; They definitely have a need. In 2019, they found the money.

This segment has always found a way to grow every year – until 2017. The small drop in spending was caused by An extremely competitive environment. Consumers increased frequency but paid less. In 2018, the increased number of outlets really hit home, especially for the younger groups and spending exploded. Value and Convenience in 2019 resulted in Gen Xers and Millennials looking for and finding a better deal while the oldest group “got on board”.

Now, Veterinary Services

  • Boomers are still the biggest spenders in this segment, but again they only lead Gen Xers because of more CUs.
  • The younger groups both have a consistently growing commitment to this Pet Parenting responsibility. The combined Veterinary spending of Millennials/Gen Z and Gen Xers has increased $6.23B (+101%) since 2015.
  • Boomers – Ave CU spent $173.43 (-14.07); 2019 Veterinary spending= $7.48B, Down $0.72B (-8.8%)
    • 2015>2019: Down $0.69B; Except for the lift in 2017, spending was consistent at $8B. In 2019, it turned down.
  • Gen X – Ave CU spent $203.10 (+$15.25); 2019 Veterinary spending= $7.21B, Up $0.54B (+8.1%)
    • 2015>2019: Up $2.90B; Since 2016, their Veterinary spending has exceeded the national CU Average. In 2018, they took over the top spot in CU spending. In 2019 they widened their lead over the Boomers.
  • Millennials + Gen Z– Ave CU spent $140.98 (+$14.73); 2019 Veterinary Spending $5.18B, Up $0.78B (+17.7%)
    • 2015>2019: Up $3.33B; Their CU spending is up 118% since 2015. Veterinary has become a much bigger priority.
      • Millennials Only – Ave CU spent $149.08; 2019 Veterinary spending = $4.92B
      • Gen Z Only – Ave CU spent $68.60; 2019 Veterinary spending = $0.25B
  • Silent + Greatest – Ave CU spent $114.65 (+$1.77); 2019 Veterinary spending $1.93B, Down $0.02B (-1.2%)
    • 2015>2019: Down $0.85B; Money is a priority, but so is their pets’ health. The $ decrease is just from fewer CUs.

Gen Xers and Millennials have consistently increased their commitment to Veterinary Services. In 2015, their share of Veterinary Spending was 36%. It is now 55.7% – a 55% increase. This is a big, fundamental change in spending behavior.

One last chart to compare the share of spending to the share of total CU’s to see who is “earning their share”.

  • Gen X Performance – Total: 122.3%; Food:119.7%; Supplies:121.3%; Services:131.2%; Veterinary:123.2%
    • In 2019 the Gen Xers kept the top spot in performance. They again “earned their share” in every industry segment as well as Total Pet. They have increased their Total Pet Spending every year since 2015. During this time, their spending has become more balanced and their performance has improved. The only reason that they are not the leaders in Total $ is that the Boomers have more CUs. Gen Xers range in age from 39 to 54 so they are just entering the peak earning years. Expect their commitment and pet spending to continue to grow.
  • Baby Boomers Performance–Total: 112.3%; Food:123.4%; Supplies:107.6 %; Services:98.9%; Veterinary: 105.2%
    • Boomers led the way in building the industry and are still the “top dogs” in $. They earn their share and in fact, are the still the spending leader in Total Pet and every segment but Services. However, their CU numbers are beginning to fall – down 1.9M (-4%) since 2016. Their Spending fell again, in 2019 but nothing like the record $6.5B drop in 2018. They should hold the lead in Pet $ for several more years and be a major force for many more, but the Gen Xers and then Millennials are preparing to take their turn at the top.
  • Millennials Performance – Total: 83.8%; Food:74.3%; Supplies:93.3%; Services:83.3%; Veterinary:90.4%
    • Like the Gen Xers, Millennials have increased their pet spending every year since 2015. Their spending is more evenly balanced, and performance has improved. They are growing in CU numbers but their future as the Pet Parenting spending leaders is still a long way off. They need increased income and a more stable home situation. They are educated and well connected. Indications are that they may lead the way in adopting new trends, especially in food. Their progress is good news, but in reality, their leadership is still more than a decade away.
  • Silent/Greatest Performance – Total: 64.6%; Food:62.4%; Supplies:51.2%; Services:86.4%; Veterinary:69.5%
    • Pet Parenting is more challenging in old age, but they remain committed. 0.88% of their total spending is on pets.
  • Gen Z Performance – Total: 48.7%; Food:38.6%; Supplies:89.7%; Services:23.7%; Veterinary:41.6%
    • They are just beginning so the numbers are low. Next year we’ll get the first measurement of their progress.

Baby Boomers are still the Pet $ leaders, but Gen Xers, followed by Millennials are ultimately the future of the industry. Both groups seem ready, willing and able to take their turn at the top. As these groups have risen, Pet Spending has become more balanced across the generations. This bodes well for the continued strong growth of the industry.