Here’s Why Clients Should Love B2B Programmatic

B2B Programmatic
B2B Podcast

Here’s Why Clients Should Love B2B Programmatic

If your clients worry about tracking audiences to target their digital ads, here’s something to put their minds at ease.

Tracking is a fact of internet life. We may feel a little uncomfortable about it in theory, but in practice it doesn’t keep us from launching our browsers and visiting one site after another.

Nevertheless, for B2B advertisers, it’s natural to worry about what customers might think about being tracked. Customers expect to see business-related ads on industry websites, but as soon as those ads appear on ESPN.com or their local weather app, they know they’re being followed.

That client concern is, in fact, a positive sign, revealing their customer-first approach—which is as it should be. And while their worries are valid, the pluses of programmatic advertising may put their minds at ease.

What Makes an Ad Programmatic?

You can show your digital display ads to a B2B audience through direct buys on industry websites (endemic advertising), or you can target your audience programmatically. A programmatic buy reaches an industry’s audience regardless of the websites being viewed, and appears to the right people in an unrelated editorial environment.

Essentially, it’s an automated process of buying and selling digital ad inventory through an exchange connecting advertisers to publishers. It allows advertisers to target a specific audience based on geography, interests, behavior, web history, etc. and reach them wherever they are online.

Programmatic’s Three Big Pluses

Programmatic is an opportunity for B2B advertisers to expand their digital footprint far beyond the narrow reach of endemic industry websites (also known as vertical websites). Those sites are highly relevant to customers, but their reach is limited to small audiences made up of monthly unique visitors. Not only that, but many industry websites may not see engagement with monthly unique users on a consistent daily or weekly basis. Ad campaign messages limited to industry sites therefore can miss a sizable portion of the target audience.

So, aside from the limitations of endemic campaigns, what are the key benefits of programmatic advertising?  The easy answer is targeting, efficiency, and performance.

Real-time targeting
Campaigns reach a target on whatever site they choose to visit across the web, upping the chances of getting timely messages in front of current and potential customers.

Cost efficiency
Our 2020 programmatic display ad CPMs range from $2 – $12. Our 2020 CPMs for display ads on endemic sites range from $10- $250.

Marketing performance
For the B2B programmatic campaigns we managed in 2019, click-through-rate performance was 52% higher on average vs. endemic sites. Also, endemic cost-per-click was over 7x higher than programmatic.

How do Audiences Really Feel?

Despite the limitations of endemic advertising and the benefits of programmatic ads, the key issue remains: How does a B2B audience feel about seeing ads for their business on non-business sites? And how do they react when they’re using the web for their own entertainment on their own time, only to see your B2B ad?

Here at R+K, we’ve run years of programmatic campaigns for B2B clients investing in digital advertising, and honestly, we haven’t seen any customer backlash. For one client specifically, we’ve purchased hundreds of millions of programmatic impressions for dozens of different B2B brands over the past year, and not once has any agency, client, or publisher partner experienced customer complaints around ad targeting or customer tracking.

That said, internet users who strongly object to having their activity tracked for advertising purposes always have the option of updating their privacy settings to block tracking cookies. This, too, has its benefits, since advertisers can remove people from their audience pool who are least likely to engage with their ads.

B2B audiences are digitally savvy people. They understand they’re being targeted with digital advertising whenever they go online, open an app, or visit social media. In our experience, the vast majority of business professionals have grown to accept this practice and don’t find it overly intrusive. The fact that people click on programmatic B2B ads at a rate that’s 52% higher on average than endemic sites definitely supports that conclusion.

Visit Marketing to Farmers for more R+K knowledge about endemic vs. programmatic advertising. Have questions about how programmatic advertising could enhance your marketing program? Contact R+K Business Development Director Gino Tomaro at gtomaro@rkconnect.com.

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Google Chrome Privacy Sandbox: What Does it Mean for Your Marketing Program?

Google Chrome Privacy Sandbox: - Impact on Marketing Program
Google Chrome Privacy Sandbox: - Impact on Marketing Program

Google Chrome Privacy Sandbox: What Does it Mean for Your Marketing Program?

Google announced it will phase out 3rd-party cookies by 2022. We’ll review what this means for brands and how they might adjust their marketing programs.

In a January 2020 blog post Justin Schuh, Director of Chrome Engineering at Google, announced Privacy Sandbox, a project designed to phase out 3rd-party cookies on its Chrome browser. It will take two years, with 3rd party cookies fully phased out by 2022. In the meantime, Google is working on alternative solutions that will make consumer data more secure but still allow for targeted advertising.

With this announcement, many of our peers and clients have asked what this means for their brands, their marketing strategy, and their own personal information. We’ve outlined our take on this news here.

What does this mean for marketers?

Programmatic advertising – which helps us target the right audience regardless of where they are – relies on 3rd party cookies for targeting and measurement. We explain the difference between programmatic and endemic advertising in this Marketing to Farmers post. These cookies are designed to follow users across the internet, tracking their behaviors to generate virtual user profiles. This is a powerful and effective tool for personalized advertising and conversion tracking but created concerns for consumer privacy.

So why mess with a good thing? By eliminating third-party cookies, Google better protects user data. It’s a move that forces the industry to adapt and come up with new ways to track conversions and target users. Consumers get greater protection, and programmatic publishers get alternate means of monetization.

Google Chrome represents 69% of online activity on desktop and 40% on mobile. Given that the leading mobile browser, Apple’s Safari, already prevented the use of tracking cookies in 2018, the ability to use 3rd-party cookies will be virtually gone when Google completes this transition in 2022.

What are some potential outcomes?

  • Google’s intended outcome is that 3rd party cookies become obsolete and replaced with a new universal solution that protects consumer data. One solution being tested: storing individual user-level information in the browser.  This allows access to certain information via an application programming interface (API), which allows apps to borrow data and interact in a specified way. This means the conversion would be tracked, but the user data would not be passed back. Several APIs have been proposed to solve for ad selection, conversion measurement, and fraud protection. One proposed API is a “trust token” designed to anonymously authenticate a user and distinguish them from bot traffic.
  • Publishers will likely try to scale/monetize their 1st-party data, through first-party cookies and by asking users to log in with an email and provide additional demographic data, allowing for more granular onsite targeting. 1st party cookies are not affected by these changes from Google, as this data is obtained through some form of consent or direct relationship with the user.
  • There could be a shift towards contextual targeting. Even if behavioral targeting is lost, it will still be possible to target a user based on keywords, time, and location. It will become increasingly important to make sure that ads are tailored to that context, since they can’t be personalized directly to the user. Premium publisher content may also experience a resurgence.
  • Brands may choose to leverage their email and CRM data more actively for targeted advertising.

What does this mean for our brands and yours?

The burden of finding an alternate targeting methodology largely falls on Google and a brand’s digital partners. Over the next two years, they will work together to develop solutions that allow some of the same capabilities as 3rd-party tags (behavioral targeting, conversion tracking, frequency capping, etc.).

At R+K, we’ll address this with each of our partners to understand and evaluate the new solution that they provide. Some programmatic partners have already anticipated this cookie-less shift and have robust data sets for targeting that are not reliant on 3rd-party cookies. Depending on the viability of these new solutions, there could be a shift in our recommendations for digital investment toward partners with robust 1st-party data or alternate forms of targeting (in particular, Social and CTV/OTT).

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Break the Cement Ceiling in Construction by Marketing to Women

Women in Construction
Women in Construction

Break the Cement Ceiling in Construction by Marketing to Women

Why male-dominated industries like construction should change the way they market to women.

In the United States, full-time professional women still battle to earn wages equal to their male counterparts. Though the gap has narrowed slightly in the last decade, women earn on average just over 80 percent of what men make.1 But there are some bright spots. Women in the construction industry earn 99.1 percent of what their male peers make.1

So why do so few women pursue construction jobs? The answer may lie in how they are marketed. At Rhea + Kaiser, we have a deep interest in construction – from our historical work with household names like Caterpillar, to current marketing strategy for PoreShield, a soy-based concrete durability enhancer used in construction and other projects. We wanted to learn more about the industry’s workforce and help explain this disparity.  

Laura Pager

Gale Construction Company President Laura Pager says the field is misrepresented. “I don’t think women realize there are good-paying, 40-hour per week jobs you can raise a family on in construction,” she explains.

Gale Construction is a SBA 8(a) Woman Owned Small Business (WOSB) General Contractor. Pager founded the company with friend Mike Gale in 1996. Today, she is the sole owner. They made their intro into the industry through small residential projects and municipal work. Bid by bid, they learned how to go after larger projects. Today, they almost exclusively manage federal projects out of six states and the District of Columbia, through offices in Joliet, Illinois; Maryland; Florida and one soon to open in St. Louis. Their biggest job to date supports the Army Corps in Florida.

“If you can do an Army Corps job, you can do anything.” Pager says, explaining the daunting procedures and paperwork behind federal contracts. “I didn’t know I was as tenacious as I am. I couldn’t have imagined in 1996 that I would enjoy the construction industry this much.”

As of December 2018, less than 10 percent of construction employees were women.2 Pager says the field is misrepresented to women, who do not realize there are desirable job opportunities in construction – even out in the field. “If you are a laborer, the work is physically difficult. But I have found over the years that women are better equipment operators than men. They are good with the machines, they are good truck drivers. Women have a lot of qualities that would make them successful in the trades.”

Pager says there is much room for improvement in the way the construction industry markets to women, and her own experience as a woman has changed the way she markets her business to customers. “I always say that I am a woman-owned construction company; it’s part of my tagline,” she explains. “I’m small business certified and certified as a WOSB, so contracting officers get credit for working with me.”

When she first entered the construction industry in the late ‘90s, Pager was mistaken for the stenographer in business meetings. When she walks onto a job site today, people know she is the prime contractor. Her advice to women who work in or are considering entering traditionally male-dominated fields is to prioritize knowledge and confidence. “As long as you know your business and your capabilities, you’ll put everyone at ease.

Now that she has broken the “cement ceiling,” Pager aspires to increase gender and racial diversity at all levels and roles in her organization and the industry at large. She is the director of the Federation of Women Contractors and has worked with legislators and lobbyists in Springfield and Washington, D.C. to improve female participation in state and federal contracts.

Significant strides will require reframing the way all prospective employees view the industry. “The well is drying up for qualified people who even realize these jobs exist – we need to get the trades back in schools,” Pager warns. She hopes to see continued interest in the field that has brought her professional success and fulfillment.

Pager says construction is challenging, but there is variety that many professionals crave. Most importantly, she adds, the community imprint is tangible. “I love that I can go back to an old job that we physically built – I can see it, touch it, feel it and walk on it. It is a very prideful thing.”

For more information about Laura Pager and Gale Construction, visit http://www.galeconstructioncompany.com/.

Gale Construction Company

[1] https://www.bls.gov/opub/reports/womens-databook/2019/home.htm

[2] National Association of Women in Construction

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Earning a Place in the Public Conversation

Earned Media
Earned Media

Earning a Place in the Public Conversation

Earned media goes beyond public relations to include opportunities to increase mind share.

When we announced the new R+K agency structure last year – reorganized to focus on paid, owned, and earned media and how we interact with the customer – there were a few questions, a little bit of uncertainty, and a lot of excitement. Personally, I was excited about evolving the way we talk about what we offer, from “public relations” to a focus on what we really achieve, earned media.

After all – explaining Earned Media is a lot easier than the often-nebulous idea of Public Relations. Earned media is what we do to develop relationships and influence opinions toward the goal of greater awareness and positive perception – it’s how we earn the content and coverage that moves the needle in favor of our clients.  

Since I started in this industry more than 20 years ago, I’ve heard many non-PR clients and colleagues ask, “Can we do some PR for this project?” when what they really mean is “Can we do some media relations for this project?” Media relations has traditionally been the foundation of many PR programs. But as communications channels expand and opportunities grow, PR encompasses more and more practices.

Earning a Place in the Conversation

By looking at our department through the lens of Earned Media, we ensure plans are comprehensive and strategic – not just a bunch of independent tactics that are called a plan because they’re strewn together in a single presentation.

When we think about earned media, we expand the goal from where we can get media coverage to where we can earn mindshare. Some of the same channels are used by our colleagues in paid media. The difference is in how they are accessed. Earned media is achieved through one of the tenets of media relations – relationship building, rather than through paid promotion or a media buy.

Earned Media Can Be….

  • Social Media – When consumers are inspired to post about your brand on their channels.
  • SEO – When organic web content boosts your brand’s search ranking
  • Influencer Relations – When the positive perception of your brand entices influencers and bloggers to communicate about it
  • Customer Reviews – When customers advocate for your brand at no cost to the brand
  • Word of Mouth – When customers advocate for your brand to each other
  • Media Relations – When journalists write about your brand at no cost to the brand

Understanding Shared Media

During our restructure, a few people asked where Shared Media lives within our agency Paid-Owned-Earned model. At R+K, we believe Shared shouldn’t live on its own. It’s an aspiration of the earned, owned and even paid channels. In earned media, you earn trust so your target audience will share information about your brand on their channels. With owned media, you share information about your brand your way – on your channels. In paid media, you pay to promote your brand on channels. At R+K, we believe that shared media is content produced from either of these three categories that is then organically shared online.

As communications practices continue to advance and diversify, these definitions will undoubtedly change. The discussion around this evolution helps us continue to grow as practitioners and make us better marketers.  Do you have a different view of earned, owned, paid and shared media? We would love to hear from you on one of our social channels below.

By Amy McEvoy – Head of Earned Media

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Customer-centric Creative Fuels P-O-E Executions

Owned Media
Owned Media

Customer-centric Creative Fuels P-O-E Executions

Crash course in customer-driven owned media philosophy

Great creative is powerful. A well-made ad can make you laugh, or cry or get out your wallet and hand over your hard earned cash. But before that can happen there has to be an idea. And that idea must stem from an insight, rooted in a truth experienced by the customer – that’s where the tension and the interest lie.

When we realigned our departments by Paid, Owned and Earned channels (P-O-E), it was with the goal of putting the customer first. So, what does that mean exactly? It’s simple. Everything we do from planning to concepting to creative execution, is with our client’s customers in mind.

Last month we explained how this focus comes to life through paid media planning. Today, we’re giving you a crash course in how our Owned philosophy reflects our customer-first approach. At R+K, Owned comprises owned channels – such as blogs, social media, and branded materials, but also the creative concepts the fuel them.

P-O-E helps us to uncover insights and truths by encouraging cross-function collaboration throughout the entire process. Our creatives are included from the beginning so we can utilize their most valuable skill – solving problems with engaging solutions. After all, to reach our client’s customers we have to first grab their attention. Otherwise, the strategy, no matter how spot-on, won’t have a chance to make an impact.  

It’s why we strive to develop big ideas born from insights that work in service of the client’s customers and business goals. Then we go to work making sure those ideas can be executed across a variety of channels. This transforms ideas into deliverables such as a video, website or print ad our clients’ customers can engage with.

When each deliverable – no matter how small – is executed with the customer insight in mind, we’re able to reach the customer with relevant messages that capture their attention wherever we meet them. Creative campaigns have greater impact and resonance, and we’re able to make the most of every customer engagement.  

Stay tuned for our fourth and final post about this P-O-E approach. This time, we will walk you through how it is reflected in our Earned Media department.

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R+K Head of Earned Media Named to 20th Illinois Agricultural Leadership Class

Amy McEvoy iALF Illinois Agricultural Leadership Foundation
Amy McEvoy iALF Illinois Agricultural Leadership Foundation

R+K Head of Earned Media Named to 20th Illinois Agricultural Leadership Class

Amy McEvoy one of 24 agricultural leaders chosen for fellowship

Amy McEvoy, head of Earned Media at Rhea + Kaiser, was recently announced as a fellow for the Illinois Agricultural Leadership Foundation (IALF) Class of 2022. McEvoy was selected to be part of the 20th class following a competitive application and interview process.

Beginning August 2020, McEvoy will participate in 15 seminars over 19 months to build the skills, knowledge and character to confront the most urgent and pressing issues of global and local food security and sustainability. The  program is designed to equip fellows with the skillset and experiences necessary to become policy and decision makers for the agricultural industry.

Fellows in the Class of 2022 represent a broad spectrum of food and agricultural interests and bring diverse agricultural experiences, from farming to multi-national agricultural business. For the first time in the history of the leadership program, the class will have more women than men; McEvoy is one of 14 women selected to be part of the 20th class.

“Though agriculture has always been a vital sector of the U.S. economy, the pandemic we’ve experienced since the start of 2020 has reinforced just how essential its workforce is to each of our lives,” said McEvoy. “Advocacy for the agriculture industry is critically important – now more than ever, and I’m honored and excited to help meet this such a vital need.”

Over the coming months, McEvoy will share updates and insights on the R+K blog Marketing to Farmers. To learn more about the Illinois Agricultural Leadership Foundation, visit: agleadership.org.

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Ensuring the 3Rs of Media Through Paid Channels

Media Through Paid Channels
Media Through Paid Channels

Ensuring the 3Rs of Media Through Paid Channels

A few weeks ago, we talked about our agency restructure to focus on Paid, Owned and Earned media, with promise of more details on each individual discipline.

The purpose of this restructure was to ensure the customer — or, rather, the client’s customer — is always at the forefront of what we do and how we communicate.

Clients – and agencies – always have a vision of what will make an impact.  A highly visible placement, such as a digital takeover splash page or the back cover of a magazine, can be tempting. But we are not the customer. What is the right way to reach them? Just because there is the potential for a lot of eyeballs, doesn’t mean they’re the right ones.

Planning for Paid channels is just as important as the negotiating and buying process. Following are the three key tenets that lead our Paid team’s customer-first approach to media planning.

Right Person

First and foremost, Paid media needs to appear where it has the best chance to reach the target audience. But who are they? Before they embark on a media plan, the Paid team asks ”what data do we have to clearly locate the right audience for the message?” We prioritize these data-driven methods:

  • 1st Party Data: Data collected or owned by the client with which we’re working, including customer data, sales data, sales leads and prospects, competitive and market share data, website analytics, etc.  
  • 2nd Party Data: Another source’s 1st party data about your customers. This includes lists rented or purchased for marketing needs.
  • 3rd Party Data:  Information aggregated from multiple sources by an entity that doesn’t have a relationship with customers but that provides scale not available with 1st party data

Right Time

Once we’ve identified the current and prospective customers, our Paid team looks at when customers will be the most receptive to our clients’ messages. Today’s media is much more permission-based, asking customers to engage, and timing of this request is vital to success.

We ask a lot of questions to identify that ideal opportunity to engage:

  • Which media channels dominate the customer’s time? 
  • How do the customer’s media use habits shift during the day? The year?
  • What purchasing cycles are apparent in the customer’s behavior?
  • How are current economic conditions impacting customer expenditures?

Right Place

The third component that is vital to any media planning process is determining where customers will be. For example, a few decades ago, just about every noon news broadcast in rural areas included the daily farm report. That’s when farmers almost always came in for dinner. As farmers’ schedules became more erratic, noon farm reports went away as farmers were watching less. Some questions that help us determine the right place are:

  • Which channels does the customer use to stay informed? Which do they rely on to make decisions?
  • In the always-connected environment, is the target audience depending on mobile for personal or professional use?  
  • Are the media channels designed for this customer pursuing a digital-first publishing approach?
  • How does the customer’s use of multiple media channels (web sites, TV, print, social, etc.) contribute to fragmentation of the core audience? 

This is an overview of our approach to putting the customer first in Paid Media. Every customer-first campaign manifests itself in paid channels differently, based on how they are shaped by objectives and strategy. But when we put ourselves in the customer’s shoes and follow the data, we can always find the perfect intersection of our message with their needs.

Stay tuned for upcoming posts when we’ll talk more about our Owned and Earned teams. We’ll talk about how they are different from the conventional Creative and PR departments, especially when it comes to content development.

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Prepared Campaign: The GROWMARK System Response to COVID-19

Prepared Campaign - The GROWMARK System Response to COVID-19
Prepared Campaign - The GROWMARK System Response to COVID-19

Prepared Campaign: The GROWMARK System Response to COVID-19

According to a poll conducted by Farm Market iD and DTN/Progressive Farmer, nearly 90% of farmers fear the coronavirus will hurt their business and 84% have at least some concern that the virus will affect the health of family or friends. When asked about how farmers are changing their current behaviors, at least 50% had taken steps to reduce face-to-face meetings and be more cautious with money expenditures.

Like many other professional groups, farmers feel uneasy and they’re looking for help and reassurance from their advisors and suppliers during this pandemic. With so much uncertainty, they want to know what and who they can count on.

GROWMARK, Inc., a leading ag cooperative in the US and Canada, and its FS member cooperatives wanted to help ease these stresses and reassure customers, and the ag community, that they were fully prepared to navigate them through this uncertain time. Collaborating with GROWMARK,  R+K created the Prepared campaign to address customers biggest business concerns – staying connected with their local specialists and impact on product supplies. Anchored with the message ‘Prepared for Times Like These,’ the campaign sought to quickly convey the pro-active position of GROWMARK and FS companies’ capability to address the situation, keeping customers’ businesses running with minimal disruption.

Aligned with current communication initiatives, R+K took an integrated approach to ensure that the Prepared  message would reach customers and the ag community.

  • Landing pages, detailing the measures put in place to address customers concerns, were created for both corporate websites: com and growmark.com.
  • Creative assets were developed and produced for social, display, print and radio. Video and earned media efforts were also created in collaboration with the GROWMARK communications teams.
  • R+K media strategies targeted both the Midwest and Ontario geographies, running the Prepared campaign as the only message for the first week and a half in early April, in recognition of it’s timeliness and importance. Given extended shelter in place orders, the campaign continues as part of the messaging rotation through the end of May.

The Prepared campaign has resonated strongly throughout GROWMARK  and with FS member cooperatives. It will be woven through the upcoming 2020 Annual Meeting, and key stakeholders in all geographies have commented that these marketing efforts have been spot on for such an unprecedented time in our world.  

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3 ways word choices hinder effective communication

Words matter
Words matter

3 ways word choices hinder effective communication

Whether in a professional or social setting, effective communication demands we show respect for our audience while we inform, instruct or entertain them. To do that we must choose our words wisely. That means choosing words that do not confuse, alienate or annoy your audience. Yet every day, we hear or see people losing their audience because they made poor word choices in one or all of the following ways.

1. Using big words when small ones will do. 

(The fancy-word people call that altiloquence.) Proposals, web content and presentations are often riddled with the verb utilize when we mean use. Who decided to use such a passive term as utilize when use is so much shorter and active? Another example is “we will endeavor to…” How about “we will try to…”? It’s simpler, clearer and certainly less pretentious.

This post on socialtriggers.com explains why big words make you look stupid. Before you think it’s outdated, the same subject came up on thehrdigest.com in 2018: How to Sound Smart Without Using Fancy Pants Words. There are dozens more out there. And these aren’t just opinion. Several of them reference research conducted at Princeton University, the results of which were published with what is, hopefully, an intentionally ironic title, “Consequences of Erudite Vernacular Utilized Irrespective of Necessity: Problems with Using Long Words Needlessly.”

As communicators, we all like to drop an occasional vocabulary grenade in a conversation, but we should be aware we’re doing it and anticipate getting busted.

Using big, fancy words can torpedo a conversation because the word is too big, not quite the right word or a malapropism. How often do we say dialect when we mean accent? Or how about that time the team’s effort was described as duplicitous when she meant to say duplicative? Redundant would have sufficed.

2. Over-using jargon.

Technical terms are accepted and expected when talking in technical circles, and you know what you’re talking about. Jargon is not acceptable, ever. It is at best a conversational crutch, and most likely subterfuge for incompetence.

This problem is not exclusive to the marketing industry. Jargon is rampant in business, academia, social settings and, yes, coffee shops. Jargon, while enabling the speaker to feel more confident, actually telegraphs a shallow knowledge. Classic example: the barista giving the elderly gentleman the stink-eye when he orders a large coffee instead of a venti black coffee with room.

3. Abusing acronyms.

You may think you are showing insider knowledge when you liberally sprinkle acronyms in your presentation. But whether you’ve first defined them or not, using acronyms, just like big words, disrupts your audience’s attention. Listeners stop listening as they try to remember or discreetly Google what the acronym stands for.

In fact, more than a decade ago, the AP Style Guide started telling us only to use acronyms that are commonly understood, such as AP, DNA, FBI, UFO or USDA. Even then, use them sparingly. Some lesser known acronyms may be acceptable when communicating within a specific profession, however. For example, when communicating with veterinarians, you won’t need to spell out acronyms like AVMA, FIV, PRRS or TID.

The point is this: We’re all guilty of these mistakes at times, but you have the power to stop letting your word choice get in the way of effectively connecting and communicating with your audience. The consequences of over-using big words, jargon and acronyms can be avoided with greater respect for your audience and more intentional curation of your words.

Words matter. Choose them wisely. Effective communications depend on it.

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Pet Panel Survey Series: Pet Insurance

Insights from pet parent panel
Insights from pet parent panel

Pet Panel Survey Series: Pet Insurance

Why pet parents buy in… and why they don’t

Welcome back to our pet panel series of industry reflections fueled by proprietary research conducted by Rhea + Kaiser. Our intent is to assess and validate a variety of pet care trends and hypotheses, and to formulate marketing strategies within the category. Our previous post explored factors that influence purchases of pet supplements. In the following post, we present new data on how pet parents perceive pet health insurance and what this means for pet insurance providers and other pet care-related companies.

Over the past few years, pet health insurance has risen in popularity. In fact, 2.43 million pets were insured in North America at the end of 2019, an increase of 17.1% over the previous year, according to the 2019-2020 American Pet Products Association (APPA) National Pet Owners Survey. Not only can a pet health insurance policy protect against high medical fees, but it provides peace of mind to pet parents who know their pets are protected in the event of a surprise accident or illness.

Perceptions of pet insurance

According to our most recent survey, over 55% of pet parents either currently have or are considering pet health insurance (18% currently have, 8.3 % are planning to buy, and 28.6% are considering purchase).

Among pet parents who do have pet insurance, reasons for buying fall into three buckets:

  • Helps defray the cost of veterinary expenses (routine or emergency)
  • Provides peace of mind in knowing their pets are protected
  • Humanizes pet (i.e. “I have it, so they should too)

What about the remaining 45.1%?

Many of the respondents who do not have pet insurance do not believe they can justify the expense or do not believe they will see a return on the investment. Other responses, such as “my pets are too healthy” and “it doesn’t make sense for my pet’s lifestyle” were more surprising.

Pet insurance as an employee benefit

Though nearly half of pet parents were not interested in purchasing pet health insurance, nearly three quarters were interested in taking advantage of employer-sponsored pet insurance, if offered.

When asked about the appeal of pet-related employee benefits, pet health insurance ranked third among 10 possibilities, with “discounts on pet supplies” and “reimbursement for pet boarding during work travel” ranked first and second, respectively. 

These findings make us wonder: is there an opportunity for pet care retail giants like PetSmart, Petco or Pet Valu to enter employee benefits packages? Or could it be a strategy for mid-sized and/or regional retailers to expand their footprint? We also posit that employee discount packages may be a growth strategy for veterinary clinic chains to pursue in 2021, particularly as the economic impact of COVID-19 may result in less frequent visits to the vet, as we saw with the Great Recession.

Awareness of pet insurance providers

When asked about pet insurance providers, aided awareness of individual brands was slightly higher than we anticipated, given that fewer than one fifth of pet parents carry health insurance for their pets.

Of the nine brands we listed in our survey, average awareness was 15.8 percent, with a range of 4.5 to 39.1 percent. Fortune Business Insights reports that Nationwide is the leading pet insurance provider in the United States. However, in our survey, ASPCA had the highest awareness levels and twice as many customers than as Nationwide.

What does this mean for pet insurance providers?

As more brands enter the pet insurance space, we expect to see more fragmentation in brand awareness and consideration. So, how does a brand stand out? With more than one-third of R+K Pet Parent participants planning or considering pet health insurance, we suspect there is an opportunity for companies to educate pet parents about what pet insurance is and how it can benefit their pet.

Some pet parents confuse pet health insurance with pet life insurance. One respondent stated, “Insurance is to ensure the surviving partner is provided for financially. My pet does not earn money.” Amid all the proliferating brands and providers, brands can add value by providing pet parents resources to make informed decisions about pet insurance.

There is also an opportunity for pet insurance providers to appeal to employers to offer pet insurance benefits that leave more money in their employees’ wallets.

At Rhea + Kaiser, we’ve helped brands differentiate themselves and command significant market share in highly crowded categories from flea & tick products to joint-health supplements to vet-prescribed NSAIDs.

Learn more about our pet care expertise here, and follow us on social media to stay up to date as we continue to share insights, successes and tips:

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If you have topics you would like to explore with our Pet Parent panel or would like to discuss marketing in the companion pet space, please contact Gino Tomaro, Business Development Director.

For more information about our approach to marketing in the pet care industry, download our R+K Pet Care Credentials.