Global Economics

Japan's Pampered Pet Set


The country's human population may be on a downward spiral, but pet ownership is up, along with businesses to coddle the little critters

Economists talk plenty about Japan's demographic challenges—and with good reason. Japan's women give birth to just 1.3 children on average during their lifetimes—among the lowest rates in the world—while the number of kids under 15 has shrunk from 19.7 million in 1996 to 17.5 million last year. Yet while modern strife is deterring many Japanese from raising kids in large numbers, that doesn't mean people feel the same way about keeping pets.

Indeed, when it comes to cats and dogs, Japan's population is booming. According to a survey by Japan's Pet Food Manufacturers' Assn., published in January, 2007, there were 24.5 million cats and dogs in the country in 2006. That's up from 17.9 million in 1996 and a rise of 37%, or 6.6 million, in 10 years.

What's more, with fewer kids to feed and clothe, the desire to pamper those pets is spawning hundreds of new businesses eager to profit from Japan's pet obsession. Chibagin Research Institute, a subsidiary of Chiba Bank, estimates that Japanese spend $13.8 billion a year on cats and dogs and related services—making the business about the same size as Japan's digital camera industry.

Empty Nest Fillers

One explanation for the trend is that small dogs in particular have become fashionable. In 2002 a popular TV commercial led to a boom in Chihuahua sales, while figure skating champion Mao Asada's toy poodle put that breed on the map. Last year, out of 500,000 dogs registered at the Japan Kennel Club, 51% were miniature dachshunds, Chihuahuas, and toy poodles.

Cats and dogs are also a handy substitute for human contact at a time when Japanese are marrying later, are more likely to live alone, and have fewer children than at almost any time in the past. "I love toy poodles. They're clever and have a nice personality, very cheerful," says Ayako Sakemi, 50, a housewife in Saitama near Tokyo who has three poodles that cost $1,300 each—plus $700 a year in vaccines.

With her two children almost grown, the pampered pooches fill a gap. "They are just like my daughters and need lots of care."

It's the array of pet accessories and services now on sale that really highlights how pet crazy Japan has become. Yuki Nozawa, 35, recognized the way the pet business was heading five years ago. She quit her job as a funeral and wedding planner to enter the pet business. After taking time out to qualify as a "dog life adviser" she's now manager of Wanwan Neverland, a shopping paradise for dog owners in Tokyo's swanky Ginza district that opened in late 2004.

Chihuahuas in Chintz

Spread over four stories, Wanwan Neverland has just about everything to keep a mutt amused. The first floor is a café where dogs can enjoy special dishes from six different menus (there's a separate menu for humans).

The second and third floors offer organic dog food, snacks, colorful toys, and accessories such as an L-shaped, $27 dog toilet designed for male dogs (it's L-shaped so they can cock a leg in the air without making a mess) that spend most of the day inside.

There are also lots of clothes. A combination stylish blue jeans and t-shirt costs $118, while items made from organic cotton, such as an $82 dress for a Chihuahua, are hot sellers.

"Long-haired dogs are better off with a dress to prevent molting. Clothing prevents cooling disorders from air conditioners in summer," explains Nozawa while patting Melon, a 3-year-old Papillion. (Nozawa cycles to work each day carrying Melon in a specially designed backpack for dogs).

And for the style-conscious who are prepared to let their hounds brave Tokyo streets clothing-free, there's a fur coloring service that uses harmless dyes to paint doggie's coat just the right shade.

Groom Service

Hotels for pets are also booming. Pet Inn Royal, one of the largest animal hotels in Japan, opened in December, 2005, at Narita Airport and caters to dogs, cats, rabbits, ferrets, and hamsters.

Prices range from $33 per night to $164 for a luxurious suite with a king-size mattress. All 170 rooms are equipped with air conditioners and air purifiers. "People see their dogs as their partners or part of their family, and there is an increasing demand for a high-standard service," says Chiyo Sakurai, general manager of the hotel.

On average pets stay for five days, and in many cases the owners ask for a grooming service during the stay. The hotel recently added massages in addition to mud packs and hot-spring bathing. "A long stay can be stressful, and these treatments are popular," says Sakurai.

So far Pet Inn Royal is doing well. The hotel takes reservations six months in advance for the busy obon holidays in August, when many Japanese return to their hometowns, and for the year-end holidays, and the rooms are already booked up.

Sakurai says many mom-and-pop-sized pet hotels could soon come under pressure from bigger chains if established hotels begin offering more pet services. Given the sums people are willing to spend on their favorite pet, that seems likely. The 79-room Hyatt Regency Hakone Resort & Spa, which opened in December, features six "dog-friendly rooms" where owners can stay with their beloved pets.

Together in the Next World

This being Japan, companies are also keen to introduce new technologies to the pet industry. AOS Technologies, a Tokyo startup, has been selling remote-controlled feeding machines for pets since 2002.

The machines store and dispense food and water at home and can be controlled by mobile phones or a PC. The latest model, launched last July, includes a video camera that enables owners to check their pet's condition. Prices range from $400 to $570.

Blue chips are also eyeing the pet market. Honda (HMC) launched a special model of the Vamos small utility van in February designed for families with dogs called the "travel dog." Honda hopes to sell 500 models by January. Stain-resistant and odor-eliminating seats are among the standard features.

Kao, Japan's largest maker of household chemical products, has launched several pet-related products. Starting in 1999 with a dog shampoo that requires no water, Kao has launched odorless toilets for cats and dogs and a pet body care line for dogs in April, 2007.

But perhaps most bizarre of all, even death is proving a business opportunity. Ohnoya, a leading funeral service company in Tokyo, now sells burial plots called "with pet" where the cremated remains of humans can be buried together with their pets. A 1.2-square-meter plot in Saitama costs $7,200.

Ohnoya has sold more than 180 "with pet" plots so far. If kids were as fashionable as pets, Japan's demographic troubles would soon be at an end.


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