Despite COVID-19, Americans Still Spend Big on Pets
I’m an only child, but I could always depend on Max.
He was basically family. The only difference was that he had four legs instead of two.
And I’m not the only one. Polls show that 95% of Americans consider their pets to be a part of their family.
Max passed away in 2018. But he’ll always be a huge part of my life. Now, I’m finally ready to find another new pet to add to my family.
Working from home during the pandemic has given me more time to take care of a pet again. So, later this month, I’m going to a ranch for rescue dogs to hopefully find the right one.
COVID-19 has only highlighted our bonds with our pets. As we spend more time at home, their companionship has become almost essential.
In fact, a recent TD Ameritrade survey found that 89% of Americans feel that dogs and cats are helping them feel less lonely right now. So, it’s no wonder that there’s been a surge in pet adoptions and fostering now that social distancing is the new normal.
Many shelters say that they are seeing record interest in adoption. The Associated Press reported that one shelter in New York saw a 2,000% increase in adoption applications in April.
And people are putting their money where their mouths are — mega charity Greater Good has granted more than $8.5 million in pet food and supplies to shelters during this pandemic. Pets have become more of a priority than ever.
It’s one of the good things to come from the chaos of 2020. And just like our move to rebuild by creating new businesses, this shows our resilience even during hardship.
But it also highlights something else…
How to Make a Fortune in the Markets
The pet care industry is massive in America. We spent $90 billion on our pets in 2019 — up from just $51 billion in 2011.
And while we don’t have data for 2020 yet, I can tell you that I’m not the only one of my friends becoming a new pet parent in the pandemic. If that’s any indication, we could be seeing even more growth this year.
It reminds me of the story of Margaret Southern — a schoolteacher who donated $4 million to her local Humane Society in South Carolina in 2012.
The funds helped the Greenville Humane Society expand its facilities and become one of the largest no-kill shelters in the Southeast. It was able to triple its capacity to take in and treat animals, which was crucial heading into the pandemic.
We’ve talked about people like Southern before — she didn’t make her millions from her job as a schoolteacher. She used America’s greatest wealth creator: the stock market.
She didn’t trade in and out of companies based on news headlines or emotions. She saw large, unstoppable trends and invested for the long term.
And furry companions weren’t just Southern’s favorite cause, spending on pets is one of those massive trends as well. Even better, because of the pandemic, the trend is colliding with another one of our favorite trends: e-commerce.
A Case Study in E-Commerce
Chewy Inc (NYSE: CHWY) was founded in 2011 — an online store hoping to capture some of the market for pet shopping.
In September, the site announced that it had added more active customers in the first half of 2020 than in all of 2019. And its sales had grown almost 50% during the pandemic.
Here at American Investor Today, we love to see things like this. We’re committed to bringing you the best ideas to make you money no matter what the market is doing. And this is more proof that trends like pet care, internet and e-commerce won’t be stopped.
As we showed you last week, as Americans recover from the 2020 recession, there will be winners and losers. The winners will be companies that adapted and thrived during COVID-19. The losers will be the ones that didn’t.
That’s why we recommend the Vanguard Information Technology Index Fund ETF Shares (NYSE: VGT). It’s an exchange-traded fund (ETF) that holds several companies in the internet and e-commerce space.
These will be the winners of the post-COVID-19 economy. While this fund doesn’t include companies like Chewy, it does have the payments companies that help Chewy run.
Incredible companies like this are hard to come by. But Alpha Investor Editor Charles Mizrahi has a talent for finding them. He recently spotted a specialty retailer for the portfolio that sells pet and farm supplies … one that could rise triple digits in the next five years.
He believes every American should have access to this kind of opportunity. That’s why he created the American Prosperity Campaign. See what he has to say here.
Managing Editor, Alpha Investor