Royal Canin Case

1473 Words3 Pages

According to the ASPCA data 70-80 millions dogs are owned in the United States alone, which means that approximately 37%-47% of all households in the U.S. have a dog in their home. Many of pet owners consider them their family members and treat them accordingly. And as for every family member the owners want what is best for their loved ones. That includes a careful selection of food they pick. However, it is not always easy to recognize harmful ingredients in the food packages. With that many pets in the U.S some well-known companies that manufacture food for our four-legged companions use cheap and harmful products. One such company is Royal Canin. The company has been under attack lately for the use of controversial ingredients in their …show more content…

Many customers are starting to switch to private brands or cheaper non-premium options because of Royal Canin’s high prices of its premium ingredients. But the substitutes are of a lower quality and there is a rare company they can offer a similar high-quality products that are substantially cheaper than Royal Canin. Therefore, many pet owners remain loyal to Royal Canin.
Pet food recalls continue to affect private labels, with consumers seeking the reassurance of brand names, thus giving leverage to Royal Canin. Moreover, most popular brands found in grocery stores like Purina and Pedigree contains lots of fillers, grains and very few quality meats.
However, private labels have strived in the pet food industry as some budget-strapped consumers sought more affordable alternatives to their usual product. New premium brands from Walmart and Target have popularized private labels as pet owners’ desire quality and low price. Brands like Walmart Natural Life and Target Lifelong have gained some share in the …show more content…

The bargaining power of buyers for Royal Canin is relatively low. America has the largest pet food industry in the world. Its pet population has grown continuously in the last decade, as residents increasingly invite dogs, cats, reptiles, small mammals, and fish into their homes. According to International Markets Bureau of Canada, the share of the U.S. pet market is impressive, with the number of dogs in the U.S. surpassing the human population of the UK. This means that the number of buyers is large, which implies weak downward pressure on prices.
Also, consumers' tendency to humanize pets and treat them as adopted children has induced premiumisation in pet food. Many buyers are willing to spend more money on pet food because of strong emotional attachment to their furry family members. It gives leverage to Royal Canin that target to specialized products for the upscale market. Therefore, the price sensitivity is relatively low, as Royal Canin offers specifically designed pet food according to age, breed, diet, etc. made of high-quality ingredients. Not many companies on the market offer the same as Royal

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