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Luxury pet hotels: The future or just a fad?
Would you like to stay in a suite? Go for a swim in the indoor pool, perhaps have a spa session before an evening concert?
How about a chew toy?
That’s right - we’re not talking to you, we’re talking to Miffy.
Luxury pet boarding is booming. A far cry from the traditional kennels or cattery, today’s luxury pet boarding offers a first-class experience to companion animals. Resorts are offering individual rooms of 5-6 square meters for each pet, background music or a comedy show to surround animals with reassuring human voices, and even pet cinemas.
While traditional pet boarding costs an average of US40 per night, luxury accommodation can cost twice as much. But for the super high-end, US pet owners can find themselves paying more than US$200 a night. And it’s not only the US that is leading the way on premium pet boarding - many pet hotels in China were charging comparable prices during last month’s Lunar New Year holiday.
I think the character on the cushion is meant to be ”福” (prosperity)
News Bites
From Kennels to Concierge Service
The U.S. currently has the largest share of the global pet hotel market. However, international markets - particularly in the Asia-Pacific region - are gaining traction fast.
“Welcome, Mr. Rex. The VIP suite is ready for you.”
🐾 At a Glance
Global Pet Hotel Market: Valued at US$8.62 billion in 2024, the pet boarding market is forecast to grow at a CAGR of 8.59% through 2030, fueled by increasing pet ownership, higher disposable incomes, and demand for premium pet care.
United States: The North American market held the largest share in 2024, accounting for 41.88% of global revenue. The US pet boarding sector, valued at US$2.3 billion in 2023, is expected to reach US$3.9 billion by 2030 (CAGR 7.6%).
Asia-Pacific: The APAC region is the fastest-growing globally, with a projected CAGR of 10.95% over the forecast period.
China: The Chinese pet boarding market was worth US$256.2 million in 2023 and is expected to nearly double to US$468.8 million by 2030 (CAGR 9%). Growth in China is mainly driven by rising incomes, declining birth rates, and a growing cultural shift that views pets as family members (Grand View Research)
🐾 Who’s Buying?
The typical consumer of luxury pet boarding services:
Has enough disposable income not to balk at premium pet boarding services;
Views their companion pet as part of the family and prioritises their wellbeing by demanding personalised services such as customised meals and medical services;
Typically makes purchases online, may follow online pet influencers;
Prefers eco-friendly products and services;
Familiar with the importance of animal welfare and pet health;
Has a busy lifestyle that requires travel for work;
Often lives in an urban, densely-populated setting
Increasingly has no children in the house, e.g. young urbanites including DINKWADs (double income, no kids, with a dog) and empty-nesters.
🐾 Opportunities
USA: Mature but Slower-Growing Market
The US luxury pet boarding market is highly competitive, with several dominant players like K9 Resorts, Dogtopia, and Camp Bow Wow.
Fragmentation: Despite the entrenched major players, opportunities remain for M&A and strategic partnerships to spur further consolidation and growth.
Success story: Founded nearly 20 years ago, K9 Resorts continues to expand. This month, it opened a new resort in Pompano Beach, Florida.
High-end, High margins: Last year, K9 Resorts signed 32 new franchise agreements, marking a 33% increase in open locations compared to the previous year. Looking ahead, the company plans to open 25 new resorts and issue more than 30 franchise licenses in 2025. Notably, K9 Resorts reports that its resort-level EBITDA is nearly double the industry standard, highlighting the profitability of the high-end pet boarding sector.
Major US brands: Camp Bow Wow LLC, Dogtopia LLC, Fetch Pet Care Inc., Pawsitively Posh Pooch LLC, Pet Palace LLC and Wag Hotels LLC.
China: Highly Fragmented but Growing Rapidly
China’s pet industry is booming, driven by increasing pet ownership, rising incomes and pet spending, and consumers’ increasing demand for pet-related luxury goods and services.
Fragmentation: China’s luxury pet boarding industry is much more fragmented that the US, with both established companies and entrepreneurial newcomers vying for market share.
Increasing pet ownership: In 2023, China had 51.75 million pet dogs (+1.1%) and 69.8 million pet cats (+6.8%) (Petdata.cn).
Surging pet spending: According to Daxue Consulting, the Chinese pet market reached a revenue of approximately RMB493.6 billion (US$67.7 billion) in 2022 and is expected to have doubled by 2025. The country’s growing middle class and evolving attitudes toward pet care are driving demand for everything from premium pet hotels to high-end grooming salons.
Regional trend towards “Experiential Pet Travel”: APAC pet owners are increasingly demanding curated travel experiences. Approximately 68% of APAC pet owners are interested in pet-friendly travel that includes meaningful experiences (Euromonitor).
Major Chinese pet boarding brands: Buddy City, Kung Fu Pet, Noble Pet Resorts.
As the Chinese luxury pet boarding market matures, the potential for market consolidation and brand differentiation is expected to increase and potentially yield opportunities for both local and international players to establish a foothold.
🐾 Challenges
USA: Up Against the Big Players
Companies entering the US luxury pet hotel space will face several well-established incumbents who have had the time to scale, potentially allowing them to offer premium pet services for lower prices than new entrants. New players will need to offer differentiated services to stand apart and gain brand recognition.
China: High Growth, Higher Risk?
Companies looking to enter the China market must consider regulatory challenges, hygiene and safety standards. According to Chinese Law, international companies can operate directly in China's pet services market without a local partner*. Overseas companies that have entered China's pet market independently include Nestlé Purina PetCare, producing and marketing pet food and related products.
However, many overseas companies choose to collaborate with local Chinese partners to leverage their market knowledge, distribution networks, and to navigate regional regulatory landscapes and potential language and cultural barriers more effectively.
As always, there is the possibility of increased economic headwinds and increasing inflation that may affect consumer demand for luxury pet services.
*Disclaimer: Not legal advice.
🐾 The Outlook
Clearly, luxury pet boarding is not just a fad. While challenges may exist, fundamentally shifting attitudes towards companion animals - both in established and emerging markets - means that consumers will continue to demand the best care possible for their pets.
Spread this Pawsome Report! 🐾📩!
Quick question: Where’s the most luxurious place you’ve boarded your dog or cat?
Just hit reply and let us know!
Until next week 🐾 🐾