Proctor & Gamble (PG) announced this week the acquisition of Natura Pet Products, a privately held company that produces holistic and natural pet foods. The price tag of the deal was not disclosed. Natura's lines will join P&G's other pet food brands like Iams and Eukanuba.
When it comes to strategy, Proctor & Gamble (PG) focuses on leading global brands and markets that are under-served. The opportunities must also be enormous. For example, P&G has a 20% share of the global house care market ($200 billion), 5% share of consumer health care ($240 billion) and 13% of beauty and grooming ($300 billion).
P&G's pet division is still fairly small, accounting for only $747 million of the $19.2 billion in revenues reported in the latest quarter. Moreover, the business has been lagging recently, leaving some puzzled about this week's acquisition. Yet, the sector does look promising. This is especially the case with premium brands, and Natura certainly has a strong offering. Its main lines include Innova, Evo, California Natural, Healthwise, Mother Nature and Karma.
A Search for the Healthiest Pet Food
Many people consider their pets as a part of the family. As a result, it is not uncommon for pet owners to buy top-of-the-line pet foods.
Back in 1992, John and Ann Rademakers and Peter Atkins saw this as an opportunity and founded Natura Pet Products in Santa Clara, Calif. Their goal was to develop the "healthiest pet food in the world." They consulted with veterinarians, breeders and nutritionists and used top-quality ingredients like USDA-inspected turkey, lamb, chicken, whole grain rice, vegetables and Grade A dairy products for their pet formulas. With so many ordinary pet foods on the market, the holistic and organic products from Natura definitely stand out.
Natura currently has a small footprint in the pet market, mostly selling through specialty stores and veterinarians. P&G should be able to effectively distribute Natura's poducts through its extensive system.
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