Pet Owners Tighten the Leash on Spending

Pandemic-era lifestyles drove a surge in pet ownership and spending, fueling outsized growth for the industry. As those tailwinds fade, rising costs are prompting more selective consumer spending, which is moderating industry expansion.

The pet boom is losing momentum: After nearly 20% growth in 2021 and a 9% annual pace through 2025, expansion is expected to slow to about 4% through 2030 —though U.S. spending could still hit $242 billion.

Affordability is central to this slowdown. Persistent inflation has raised pet ownership costs across food, veterinary services, grooming and accessories, prompting consumers—particularly younger owners—to make more careful spending decisions.

“The industry is moving into a mature phase,” says Simeon Gutman, Morgan Stanley Research’s U.S. Hardlines, Broadlines and Food Retail Analyst. “But key growth drivers are intact: Emotional attachment to pets is high, the vet is still very important and digitally positioned players are best placed to capitalize on evolving shopping trends.”

Pet Healthcare Leads as Spending Shifts to Essentials

Within pet budgets, healthcare—including prescriptions, diagnostics and routine care—has emerged as the most resilient category as owners are prioritizing essential services over discretionary purchases. Morgan Stanley Research estimates that services accounted for more than 40% of the pet industry spending in 2025, a share that is likely to continue increasing.

Veterinary care remains central to that resilience. About 60% of owners cite vets as a trusted source of pet care information, and roughly three-quarters report visiting a vet in the past six months, even as visit frequency has moderated.

Economic pressures are beginning to weigh on the pet market. Of 2,500 U.S. consumers, 67% report owning a pet, down slightly from 69% in 2024, though still above the pre-pandemic level of 64% in 2019, according to a Morgan Stanley AlphaWise survey conducted in March and April. Consumers aged 18 to 34 remain a leading ownership group, but they are also among the most exposed to rising costs. Intentions to acquire an additional pet have declined, and affordability has overtaken care responsibilities as the top reason cited for not owning a pet.

At the same time, emotional attachment remains strong. Among pet owners, 66% consider pets part of the family, up from 63% in 2024. “The emotional bond helps explain why pet spending remains resilient, even as consumers reassess their budgets,” Gutman says. 

Cost Pressures Shape Pet Choices and Spending

Cost and lifestyle considerations are increasingly influencing the type of pets consumers choose to own. Cat ownership is gaining share relative to dogs, particularly among younger consumers, where dog ownership has moderated since 2024.

“Cats typically require lower overall spending than dogs across healthcare, food and accessories, making them a more accessible option in a cost-conscious environment,” says Gutman. The shift underscores how affordability is beginning to shape not just how consumers spend on pets, but which pets they choose to own.

Digital and Services Positioning Drive Growth Opportunities

As consumers become more selective, growth opportunities are shifting toward services and digital channels, such as online pharmacies. Online purchases are expected to account for 39% of pet spending over the next six months, up from 35%, highlighting the growing role of digital channels in pet spending.

Companies with exposure to essential care, subscription-based offerings and digital channels may be best positioned to benefit from evolving consumer behavior.

“These trends point to a more selective consumer environment,” Gutman says. “People are not abandoning pets, but they are making more deliberate spending decisions, balancing cost, convenience and care.”