The Booming Pet Economy: Premium Trends in Food, Insurance, Grooming, and Pet-Friendly Travel (2025 Insights)
By Macfeigh Atunga | September 20, 2025
In an era where pets are no longer just companions but cherished family members, the pet economy is experiencing unprecedented growth. As of 2025, the United States pet industry is projected to hit a staggering
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$157 billion in total expenditures, up from $151.9 billion in 2024. This boom is propelled by rising pet ownership rates, with 94 million US households—71% of all homes—now including at least one furry, feathered, or scaly friend.
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Globally, the pet care market is valued at $273.42 billion this year, on track to reach $427.75 billion by 2032.
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This article delves into the key drivers of this expansion: premium pet food, insurance, grooming services, and the surge in pet-friendly hotels and restaurants. Backed by the latest research from sources like the American Pet Products Association (APPA) and Euromonitor, we'll explore how pet humanization—treating pets like kids—is fueling premiumization and innovation. Whether you're a pet parent, business owner, or market enthusiast, understanding these trends can unlock opportunities in this resilient sector. For more on market analysis, check our about page.
The Surge in Pet Ownership: A Foundation for Growth
Pet ownership in the US has skyrocketed over the past decade, with dogs leading the pack at 68 million households and cats close behind at 49 million.
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This represents a 66% household ownership rate, or 86.9 million homes, according to Forbes Advisor data.
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Millennials and Gen Z are at the forefront, with 30% and 20% of pet-owning households respectively, viewing pets as emotional support amid busy lifestyles.
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The APPA's 2025 State of the Industry Report highlights a record rise in cat ownership, driven by urban living and lower maintenance needs.
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This demographic shift is key to the economy's boom: more pets mean more spending. Total US pet expenditures broke records at $152 billion in 2024, with projections for 2025 emphasizing proactive wellness and luxury services.
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As pet parents prioritize health and happiness, the market diversifies beyond basics into high-end offerings.
Premium Pet Food: From Functional to Luxurious
Pet food and treats dominate the pet economy, accounting for $67.8 billion in 2025 US spending—over 43% of the total market.
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Globally, the segment reaches $158.42 billion this year, growing at a 5.79% CAGR through 2030.
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The trend? Premiumization, where owners seek functional foods with health benefits like high protein, vitamins, and immunity support.
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Euromonitor's 2025 analysis reveals that 68% of Gen Z and 69% of Millennials treat pets as family, driving demand for human-grade ingredients and personalized nutrition.
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Innovations include custom blends via apps and sustainable sourcing, with pet supplements exploding to $2.49 billion in sales last year.
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Brands like The Farmer's Dog and Ollie are capitalizing on this, offering subscription-based fresh meals that mimic home-cooked options.
Challenges persist, however, with pricing pressures from inflation curbing volume growth in emerging segments.
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Yet, resilience shines: pet food remains recession-proof, as owners cut personal luxuries before skimping on Fido's kibble. For deeper dives into sustainable pet products, see our recent post on eco-friendly trends.
Pet Insurance: Safeguarding Against the Unpredictable
Veterinary care expenditures are set to reach $41.4 billion in 2025, underscoring the need for financial protection.
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Pet insurance has emerged as a cornerstone, with 3.1 million insured pets in the US—83% dogs—and the segment growing within the $13.5 billion "other services" category.
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Providers like Trupanion and Lemonade report double-digit enrollment increases, fueled by awareness campaigns and rising vet costs, which averaged $1,200 per dog annually in 2024.
Trends point to comprehensive policies covering wellness, alternative therapies, and even behavioral training. As pet humanization deepens, insurance isn't just about accidents—it's preventive care. A 2025 Gingr report notes that 45% of pet owners now budget for insurance like human health plans.
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This shift is vital amid economic uncertainties, ensuring pets receive top-tier treatment without bankrupting families.
Grooming Services: The Rise of Pet Spas
Grooming isn't vanity—it's health and hygiene, with the US market projected at $14.5 billion by 2025.
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Globally, services will grow from $8.44 billion in 2025 at a 7% CAGR, driven by mobile units and eco-friendly products.
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Premium offerings like aromatherapy baths, CBD-infused shampoos, and breed-specific styling are booming, as owners seek spa-like experiences for their pets.
The APPA data shows grooming bundled into the $13.5 billion services bucket, with urban millennials favoring subscription models for regular upkeep.
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Innovations from apps like Gingr streamline bookings, while sustainability trends push for organic, cruelty-free lines. As Exploding Topics forecasts, high-end grooming will mainstream by 2026, blending luxury with necessity.
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Pet-Friendly Travel: Hotels and Restaurants Opening Doors
The pet-friendly hospitality sector is paw-sitively thriving, with the hotel market expanding from $4.1 billion in 2024 to $4.6 billion in 2025—a 12.7% CAGR.
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In the US, chains like Kimpton and La Quinta lead with amenities such as welcome treats, pet beds, and rooftop dog parks, catering to the 70% of travelers who refuse to leave pets behind.
Restaurants are following suit, with pet menus and outdoor patios surging. A 2025 Coherent Market Insights report values the pet-friendly hotel space at $28.6 billion globally, with North America dominating due to high ownership.
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This inclusivity boosts loyalty: pet owners spend 20% more on stays with tailored services. For US-specific geo-trends, cities like Austin and Portland are hotspots, per TripAdvisor data. Explore more on travel economics in our travel trends article.
The Future of the Pet Economy: Sustainability and Tech
Looking ahead, the global pet market could surpass $500 billion by 2030, a 45% leap from today.
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Key drivers include AI-powered health monitors, lab-grown proteins for food, and VR grooming simulations. Challenges like supply chain disruptions loom, but the sector's 8.2% CAGR signals resilience.
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Sustainability is non-negotiable: 60% of owners prefer eco-brands, per Mintel.
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As The MarketWorth Group, we're tracking these shifts—contact us for custom reports. External resources like Statista's pet food forecast provide deeper dives.
In summary, the pet economy's 2025 trajectory reflects deeper emotional bonds and economic savvy. With $157 billion at stake, opportunities abound for innovators and investors alike.
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