Corporately, however, P&G remains the distant No. 2 in the U.S. business to global giant Nestle, though P&G has moved up from No. 5 there in the past three years as well. Iams' bragging rights for brand leadership are based on some provisos that competitors may dispute. But the claimed milestone caps what P&G says are 36 consecutive months of year-over-year share gains for the super-premium brand amid headwinds of recession and rising unemployment.
"We've all seen these big spike up and down crash stories," said Jeff Ansell, president-global pet health and nutrition at P&G. "I think [36 months of share growth] really illustrates...that the Iams brand has legs and is running faster and faster."
Iams targets what it calls "concerned pet people" who think of pets as family, Mr. Ansell said, so they're not likely to scrimp when the economy sours. "Dogs have gone from the backyard to to the den, to the bedroom and into the bed."
Iams edged out Nestle's Purina, including the base Chow and premium O.N.E. brands in the fourth quarter of 2002 with a 10.1% to 9.5% dollar share in all-channel sales. That figure includes food, drug and mass outlets tracked by Information Resources Inc., plus survey and audit data P&G obtains elsewhere that track sales at Wal-Mart Stores, club and pet specialty outlets and veterinary offices.
While IRI pegs pet-food sales at $5 billion, the broader market is twice that, according to P&G. Wal-Mart alone accounts for more than $2 billion.
In IRI-tracked channels, Iams still trails Purina's Chow and O.N.E. brands combined and Nestle's Friskies. Friskies and sibling brand Fancy Feast would be No. 1 if combined, even in P&G's all-outlet rankings. A spokeswoman for Nestle did not return calls for comment.
Besides the move to mass, P&G brought more media spending to the brand. Iams spent about $20 million annually on advertising before P&G's ownership, relying heavily on marketing through pet shows, breeders and veterinarians. But P&G has averaged more than $50 million a year on media for the brand via Publicis Groupe's Saatchi & Saatchi, New York, according to Taylor Nelson Sofres' CMR.
"Increased advertising has helped put Iams on the radar screen," said Mr. Ansell. "At the same time, we've expanded our very important influencer programs that target the breeder and veterinarian."
Most pet-food brands are run by food companies, but P&G chose to attach Iams to its health-care unit. Besides adding P&G dental technology to pet food, Iams also has branched into diagnostic imaging and pet medical insurance.
"We see ourselves as a pet well-being company," said Mr. Ansell, "with nutrition as our primary focus."