Feature: Like a son but cheaper: harried South Koreans pamper pets instead of having kids

CJ ENM

24/01/2019 24:30

* Wary of child-rearing costs, more South Koreans turn to
pets 
    * As pet ownership jumps, sales of pet care products are
booming
    * Conglomerates, venture capitals funnel money into pet
startups

    By Hayoung Choi and Minwoo Park
    SEOUL, Jan 24 (Reuters) - Kang Sung-il buys Sancho, his
Pomeranian, a toy every business trip and this Lunar New Year
holiday will dress him up in a new $50 suit to visit 'grandma',
Kang's mother.
    Kang and his wife say children are too expensive and bring
too much pressure. Instead they have opted to shower Sancho with
love and gifts.
    They are not alone. South Korea's pet industry is booming,
fuelled by the same factors that have made the country's birth
rate, at 1.05 births per woman, the lowest in the world: the
high cost of education and housing as well as extremely long
working days.  urn:newsml:reuters.com:*:nL3N1YP1VR
    "Social pressures in South Korea are such that parents are
required to provide resources for decades from private schooling
to tutoring to art classes," said Kang, a 39-year old manager of
a pet funeral home.
    He says he found it hard to imagine being able to afford all
that but is happy to spend about 100,000 won ($90) a month on
Sancho.
    On top of education expenses, an average South Korean
household must budget roughly 12.8 years of income to buy a
mid-range home, compared to 8.8 years in 2014, data from KB
Kookmin Bank shows. Adding to their stress, South Koreans work
the third most hours per year among OECD nations, lagging just
Mexico and Costa Rica.  urn:newsml:reuters.com:*:nL3N1W53DH
    "The pet population is growing as more people choose not to
have babies or even not to marry," said Kim Soo-kyung, manager
at Samjong KPMG Economic Research Institute.
    Pet-owning households have surged to 28 percent of all 
South Korean households in 2018, compared with 18 percent in
2012, government data shows.
    That in turn has spurred a flourishing pet care industry
whose offerings include tailored pet diets and high-priced photo
shoots. Pet-related startups are also in vogue with venture
capitalists.
    The South Korean pet-related industry was worth 2.7 trillion
won ($2.4 billion) last year, and that could more than double in
size by 2027, according to the Korea Rural Economic Institute.
    
    PET PROFITS
    Firms seeking to profit from the boom include Pet Pick,
which produces tailored food for over 10,000 animals. It is one
of four pet startups to receive investments from GS Home
Shopping, an online retailer that is part of the GS Holdings
Corp  078930.KS  conglomerate.
    "We only use high quality ingredients, such as salmon and
cranberry so our products are more than twice as expensive as
regular dry pet food," Pet Pick co-founder Park Eun-byul said at
the firm's Seoul factory.
    "Many of our customers are millennials, who treat pets as
their babies and are willing to pay more," Park said.
    Leading venture capital fund, Korea Investment Partners,
invested in two pet startups in 2018 - Bacon, which makes toys
themed for holidays such as Christmas or Halloween, and Pet
Friends, which promises to deliver pet products within one hour.
The fund plans to invest in Picnic, which sells hand-made pet
food, later this year.
    Established firms are also cashing in. Meritz Fire & Marine
Insurance  000060.KS  saw more than 6,000 customers sign up in
three months with a revamped pet insurance product launched in
October, compared with roughly 100 per year for its earlier
insurance programme.
    Sales of pet products at CJ ENM's  035760.KQ  TV and online
shopping division rose three times last year, with a
cactus-shaped water purifier for cats priced at over $100 doing
particularly well.
    "It's twice as expensive as an ordinary purifier but we sell
dozens every day," said Lee Da-woon, who procures pet products
for the online mall.
    Pet funeral services are also increasingly popular and the
home where Sancho's owner Kang works, now holds more than 10
services a day, compared with 3-5 when it opened two years ago.
    In Namyangju, just outside Seoul, Lee Jae-hwan goes for a
walk every day carrying an urn with the ashes of his dog
Kkotgae, continuing the routine they used to share.
    "I've always introduced Kkotgae as my only son, the most
loved one in the world," 51-year-old Lee said in a tearful
interview at home, next to a ceremonial table with photos, some
food and burning incense. 
    "He never saw the ocean. I wish we had visited together."
($1 = 1,127.4300 won)

 (Reporting by Hayoung Choi and Minwoo Park; Additional
reporting by Daewoung Kim; Editing by Marius Zaharia and Edwina
Gibbs)
 ((hayoung.choi@thomsonreuters.com; +82 2 3704 5643; Reuters
Messaging: hayoung.choi@thomsonreuters.com))