Nowadays, young people consider their beloved pets as family. This love for the four-legged furry family member begs younger generations to willingly splurge on the best pet care products on the market.
A young Chinese startup, Vetresca, is catering to this market. Founded in August 2017 by Chinese national Nico Li and Singaporean Donald Keng, the company sells pet food and accessories with a unique concept. His products are popular among young Chinese pet owners who are mostly single urban dwellers.
Tapping the emotional side of pet owners
Li and Keng first met during their freshman year at the Fashion Institute of Technology in New York. In the year After graduating in 2015, both entered the fashion industry, where they set an interesting trend among their peers.
“We’ve noticed a growing number of them who are financially independent and have more disposable income. In the next two to five years, we see significant growth in women’s consumption,” Keng said in an interview. CASIA. “So we started discussing creating something different for women.”
The duo began exploring every corner of the fashion industry, looking for a fast market to tap into. However, the fashion sector was highly competitive and already crowded with giant players, the founders said. Keng and Li noticed a trend: Most single young women in China have pets, usually cats.
At that time, the Chinese pet market was growing rapidly, but it was not yet bought by the big people. Seeing an opportunity, Keng and Lee decided to start a company focused on pets. In the year They moved to Shanghai in 2016 and Vetresca began creating a concept combining the names of their pets.
They didn’t want to be another drop in the ocean of China’s pet market. When buying their pets, most owners consider the quality of the product to be the most important decision to buy. However, young people are also starting to pay attention to product design. This is where King and Lee’s fashion expertise came in handy.
“Our fashion background allows us to think outside the box and push the traditional boundaries of what pet products should be. We always challenge ourselves and ask ourselves what a product should be,” he said. .
In the early days, the company did basic market research on consumer behavior, looking at the lifestyles of young affluent Chinese women. Kng mentioned that details such as home decor preferences, fashion style and eating habits are considered in the product design process.
For example, as very Chinese youth enjoy bubble tea and hotpot, Vetresca has created a variety of pet products that match their lifestyle. Made from dried cod and meat, the company has released a special “bubble tea” snack for cats, allowing owners and pets to enjoy a little tea break together.
Non-food items such as cat litter and scratching are designed to meet the aesthetic preferences of owners. According to King, young Chinese professionals tend to decorate their apartments in a minimalist style, especially with decorative indoor plants. This inspired Vetresca to create one of the company’s best-selling items, the cactus-shaped scraper.
According to Keng, the item is now considered a “status symbol” for pet owners in China. “If you want to show that your cat lives a relatively luxurious life compared to other cats, you should buy a Vetresca cat cactus.”
Vetresca relies on these emotional values conveyed through unique designs to give it an advantage to compete with many similar but cheaper products.
“In this new era, independent women have more disposable income. She wants things in her living space to be more interesting and beautiful,” said Keng. “If customers feel that way, I think they’ll value design more and price less. So they’ll want to buy our products, not cheaper.”
The company’s products are often classified as luxury. Cat food and snack products start at $4 per item, while their popular cactus scratch is over $100.
Big market, generous customers
As China’s middle class expands rapidly, so does the number of pet dogs and cats. In 2018, the sum was 91.5 million. The cost of pets is also increasing rapidly. A report jointly released by Pet Fair Asia and Goumin, a Chinese social network for pet owners, predicts that urban pet owners will spend. RMB 202 billion ($28.6 billion) in 2019; It’s up 19 percent since 2018.
According to Frost & Sullivan, Chinese pet owners spent an average of ¥4,000 ($570) on pets in 2018. The same report predicts the market will triple to RMB 472 billion ($67 billion) by 2023, but this estimate does not take into account the impact of the Covid-19 pandemic.
However, the Chinese market offers many opportunities for the attention of petsand STo grow tartups. For example, Goldman Sachs-backed online pet retailer Boki is reportedly planning an IPO, looking to raise at least $100 million. E-commerce is also driving demand for pet products. Cat food was the best-selling category at last year’s Singles Day shopping festival at Alibaba’s sales event, outperforming other popular imports such as baby formula and face serum. Similarly, online sales of pet health supplements grew 50% annually from 2017 to 2019.
Vetresca is also growing. Within a year of its founding, the company recorded $9.5 million in sales and $720,000 in net profit. Last year’s revenue tripled to $30 million. They have also expanded to Japan, South Korea, New Zealand, Canada, Australia and the United States.
Keng said Vetresca products are available in about 40,000 brick-and-mortar stores in China covering 60 cities. The company’s goods are also available on e-commerce platforms such as Alibaba Taobao and Amazon for international buyers.
Although the Covid-19 outbreak has slightly affected the company’s sales this year, the drop was not significant, Keng confirmed. He predicted that the pet market would not suffer much from the outbreak, but noted that the company’s supply chain was experiencing some problems. “We had to rely on emergency supplies to carry out orders.”
However, the organization still has enough cash to deal with the impact of the pandemic. Although the company is tight-lipped about funding rounds, Kng said the latest $10 million investment came in November 2019 from SIG China and other investors. The company is also in the process of raising Series B funding to close this year.
As China’s offline market slowly recovers from the Covid-19 pandemic since May, customers have once again thronged malls, cafes and restaurants, Vetresca said. He decided to dare In offline business as if Establishing the first cat cafe in June. Keng, who is based in Shanghai, said the establishment has become an instant hit with an average of more than 40 customers a day.
“Customers can’t resist taking photos and sharing on social media. It’s a place where people can hang out with cats and have a fun and intimate time,” he said.The company plans to open three more cafes. Cities This year it will strengthen its presence in the Chinese market.
King wants to expand Vetresca’s spirit even further by launching a human-centric lifestyle product line. “For example, soft lenses to make your eyes look as sharp as a cat, or pet-inspired makeup,” he explains.
