Karen Washburn and her basset hound Noah check out the doggy snacks during a visit to PETsMART Friday, Feb. 4, 2005 in Raleigh, N.C. The nations largest retailer of pet supplies stands to make long-term gains in stocks as baby boomers age.
AP Photo/Gerry Broome
Washburn, who adopted her one-eyed basset hound four years ago, hasn't worried about the cost of pampering her pet, installing a custom doggy door at her Cary, N.C., home and indulging him with premium food and romps at doggy daycare.
"They give us so much, so why not? He deserves it," said Washburn, 51. "He is just the sweetest boy in the world."
Wall Street is betting on baby boomers like Washburn, who are just the sort of customers that PETsMART and many other companies are looking to cultivate. The post-war generation, born from 1946 to 1964, represents about 76 million people a huge block of consumers with unparalleled buying power. Now, as they lope into retirement, the spending habits of boomers are starting to change, and many investors are looking for ways to profit from the shift.
"This is a dominant group that still has huge buying power, and as they age they will continue to dominate trends, as they have throughout their entire lives," said Janet Engels, director of private client research with RBC Dain Rauscher.
Baby boomers are educated consumers who love having lots of choices. Lifestyle is everything for this group, whether they're shopping for pet care, a cruise ship vacation, financial advice, cosmetic surgery or a knee replacement.
Niche markets stand to benefit, analysts say, not least among them companies that provide goods and services for the much-adored pets of empty nesters. PETsMART and PETCO Animal Supplies Inc. are fast becoming the Home Depot Inc. and Lowes Co. of the pet world, and VCA Antech Inc., which snagged the Nasdaq ticker symbol WOOF in 2001, has become the nation's largest chain of animal hospitals.
The desire to outfit pets in designer duds has become a big driver in the $34 billion-a-year pet product industry. Some of the trend is fueled by young childless professionals, but boomers also play a significant role, accounting for 46 percent of all dog owners, according to the American Pet Products Manufacturing Association.
"I can personally attest to this," said Bob Vetere, the industry group's chief operating officer, who admits to doting on his golden retriever, Dakota. "The kids have gotten older, they're out of the house ... It's nice to have somebody to come home to who is wagging his tail and happy to see you. Of course, they don't care what they look like, they just want to be loved. But it's clear that these companies are realizing it's the humans who are doing the buying."
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