Pet Insurance Goes To the Dogs (and Cats)
Charting the future of public relations
Holmes Report

Pet Insurance Goes To the Dogs (and Cats)

After years as a veterinarian, Dr. Jack Stephens decided he had seen too many animals euthanized because the owner could not (or would not) pay for necessary medical treatment.

Paul Holmes

After years as a veterinarian, Dr. Jack Stephens decided he had seen too many animals euthanized because the owner could not (or would not) pay for necessary medical treatment. Stephens vowed to do everything he could to end this “economic euthanasia” and, with the support of 750 independent veterinarians, started Veterinary Pet Insurance in 1982.
Twenty years later, the company recognized that despite an 80 percent market share, the biggest barrier to significant growth was limited awareness. Pet insurance remained “undiscovered” by pet owners for most of the company’s 20-year history.
With aggressive sales goals in 2002, VPI turned to its agency of record, Colle+McVoy, to develop a year-long marketing communications campaign to increase awareness and boost policy sales. C+M successfully revitalized sales and a stagnant brand by barking up a number of the right public relations trees.
The research consisted of focus groups with veterinarians confirmed that veterinarians are independent-minded and wary of involvement with insurance plans; focus groups and a survey with pet owners found that nine out of 10 pet owners say a their veterinarian’s recommendation is the primary validation for choosing a pet-related product; and focus groups revealed that pet owners who consider their pet as a valued family member were most likely to purchase pet insurance when made aware of its availability.
An American Veterinary Medical Association study revealed that expenditures for veterinary services outpaced other consumer spending by more than 6 percent during the past five years (more than $10 billion is spent on veterinary care each year). Likewise, the cost of veterinary care has increased by more than 10 percent annually in the past three years.
 The research confirmed that pet owners are looking for ways to help defray the costs of taking care of their pets. Veterinarians play a big role in the decision-making process.
 The communication objectives were increased buy-in and support for VPI among veterinarians, and increased awareness of VPI among pet owners. The business objectives were to increase new policy sales by 60 percent vs. 2001, and to increase renewal rates among existing policyholders to 75 percent
The program was implemented as an integrated marketing communications campaign utilizing in-clinic communication, tradeshows, customer communications and media relations.
The first strategy was to educate veterinarians about pet insurance and VPI benefits. Published three times a year, the VPI Pet Gazette is distributed to 25,000 practices to keep VPI top of mind with veterinarians and vet technicians. The Pet Gazette was redesigned and expanded featuring articles designed to increase practice revenue and share 20 years of experience and actuarial data with veterinarians.
Trade media relations and training symposia all supported VPI’s presence at major veterinary trade shows, including the Veterinary Leadership Summit, a three-day event designed to position VPI as an industry leader with key industry influencers, providing practice management consultations and discussing the role of pet insurance in veterinary medicine. In addition, VPI hosted more than 300 veterinarians at an all-day symposium featuring an international panel of researchers who presented findings that show pets bring concrete health benefits to humans.
The 24-page Veterinary Pet Insurance Reference Guide was developed and distributed to more than 40,000 veterinarians providing an easy-to-use, at-a-glance insurance instruction aid.
 The second strategy was to foster loyalty by initiating ongoing communication with existing policyholders. A four-color newsletter was developed to deliver pet health tips, human-animal bond stories, pet activities, recipes and helpful VPI information. Personalized pet birthday cards are mailed to policyholders. In addition, sympathy cards are sent to policyholders whose pets have died. And a program was developed for policyholders to win points for referrals. Points are redeemed for premium items. Incentive items included new books like “The Healing Power of Pets” by Dr. Marty Becker.
 The third strategy was to mplement a targeted media relations program to build share of voice among pet owners. C+M developed four primary story platforms to anchor a year-long media relations program. All materials included VPI’s Web site and toll free number. One of the country’s leading and well known veterinarians served as a third-party spokesperson.
A media kit demonstrated that the pet insurance industry, and VPI in particular, is one of the nation’s hottest trend stories. The number of policyholders projected to increase fivefold by 2007.
VPI also partnered with leading pet author Dr. Marty Becker and as he released his best-selling book, “The Healing Power of Pets.” Dr. Becker promoted VPI throughout his national book tour. The book includes a profile on VPI’s CEO and founder Dr. Jack Stephens.
By every measure, 2002 was the most successful year in the 20-year history of the company.
A survey of veterinarians revealed that VPI is the most preferred insurance program in the industry. In fact, veterinarian endorsements are translating into increased sales. More than 50 percent of new sales are tracked back to the veterinary clinic, reversing a three-year decline in veterinary recommendations.
 Media relations activities have generated widespread media coverage. Since January 2002, more than 292 million media impressions were generated through 960 placements. Year-to-date impressions increased 196 percent over 2001. Total placements increased by 150 percent compared to the previous year. Placement highlights include:
· Network television placements including segments on ABC’s “Good Morning America,” CBS’s “The Early Show,” NBC’s “Early Today,” CNN Headline News, CNN, Fox News Channel and CNBC
· Local television news segments in all top 20 markets (a total of 61 placements)
· Nine wire stories including three AP stories, two Knight-Ridder and one Gannett News Service
· National magazines including Newsweek, Good Housekeeping, Family Circle and Inc.
· Major daily newspapers including: The New York Times (2), Wall Street Journal, USA Today (2), Chicago Tribune, Boston Globe, Houston Chronicle, Atlanta Journal Constitution and Philadelphia Inquirer
VPI’s increased visibility helped lead to increase Web traffic and calls to the company’s toll-free number (1-800-USA-PETS). Traffic to the company’s Web site increased 79 percent over the previous year. (Web visitors through October already exceeds the 2001 total.)
Call volume also reached a new record, increasing 11 percent over the previous year.
New policy sales through October increased 73 percent over the previous year. The record policy sales generated $18.4 million in additional annual revenue for the company.
Fueled by the aggressive relationship marketing initiatives, VPI’s overall policy retention rate increased to 76 percent in 2002 – meeting the company’s retention goals. The increased renewal rate generated $25.5 million in annual revenue.
 New policy sales and renewals have led VPI to record revenues. Year-to-date revenues are more than 50 percent higher than the previous year.
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