My pet is level 10 tier 1. How do I make it go to tier 2?

Hello, friend.

To create a Tier 2 pet you need to consume 2x Tier 1 pets, both at lv. 10

Click on your pet then select the "Exchange" tab on the top right of your screen.

There we go. :D

What happens to the skills of the 2 consumed pets? Will the new pet get them both?

Hi Seeds,
yes, they will get both if you choose to do so.
You will be prompted if you want to keep the skills of both pets.
You have also another option, that is randomizing the new skills of the new pet.
While raising the pet tier, you will also earn a new skill slot.
Ex. Tier 1 pet has one single skill and Tier 2 pet has two skills.
Hope I was useful.

Friendly regards

I combined two T2 pets and got back one of the material. It cost me a non farmable item for no gain and I'm so upset that this game even allows it. Be warned.