Final Book Petco 2 (2)


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Washington State University - Advertising Campaign course (ADVER480) Spring 2011

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Final Book Petco 2 (2)

  1. 1. The First Time Moments By: Campaign Kristiana Wright Madeline Gregory for PETCO Blair Breitenstein Kelsey Pearman Spring 2011 Erika Rattray Christy Koontz Alli Price 1
  2. 2. Executive Summary- 3 Situation Analysis- 4 The Market- 5 Competitive Position- 14 Advertising History- 17 The Consumer- 21 Dealers, Distributors & Brokers- 22 Sales Promotion- 23 SWOT Analysis- 27 Campaign Objectives- 28 Primary Research- 29 Recommended Target Market- 30 Selected Emphasis Regions- 36 Media Plan- 37 Objectives Media Rationale Cost Efficiency Analysis - 38 Media Flow Chart - 51 Consumer Media Channels - 52 Creative Strategy -56 Sales Promotions - 65 Budget - 72 Promotions Flow Chart - 80 Appendix -81 Citations - 83 Contacts - 852
  3. 3. Executive SummaryWhat is it?PETCO is a specialty pet food and supply store founded in 1965 headquartered in San Diego, CA. PETCO also specializes in services suchas grooming and boarding. The company lacks a brand identity with consumers. We see this campaign as an opportunity to build brandidentity for PETCO and differentiate it from competitors such as Walmart and PetSmart.Who is PETCO’s current customer?The average PETCO customer is affluent, has a higher income and tends to spend substantial amounts of money on caring for their pets.One large differentiating trend for PETCO is that on average, PETCO receipt totals are higher there than any other pet and supply store,including PetSmart and mass retailers such as Walmart. This shows that once shoppers begin purchasing their pet food and supplies atPETCO, they are unlikely to switch and many of them become lifetime users.Who is the proposed target audience?For the purpose of this campaign, we recommend targeting adults 25-34, caucasian, with a college degree and an income of $40,000+.The target demographic may have a child. This demographic was chosen based on high instance of first time pet ownership and a highpotential for generating lifetime brand-loyal consumers. It is this demographic where we have identified the most opportunity forgrowth.How do we plan to reach them?Since PETCO lacks brand identity and awareness with consumers, we recommend a heavy emphasis on promotions. Promotions will bedirected toward both trade and consumers. Media will be used as well not only to build brand identity as well as drive traffic to storesand to promotional events. Promotions and outdoor media will be focused in our key market cities while TV, Radio and Internet will bedistributed nationally.The BIG Idea!The foundation of this campaign is “first time moments”. This concept is inspired by the sentiment of first time parenting, just projectedonto first time pet owners. We want to convey this “first time feeling” through every part of the campaign and portray PETCO and THEone-stop-shop for every pet owning need from the “first time” throughout a pets life. 3
  4. 4. Situation Analysis Defining the Market This report provides a snap shot of what happening in the pet supply and pet food market. While most market analyses analyze a single product or service, this specific analysis will delve into both the pet supply and pet food markets. Within the pet food and supply market there a plethora of products including food-wet and dry varieties- supplies such as bedding and cat litter, toys and an endless amount of leashes, harnesses and collars to name a few. PETCO is a top competi- tor within this market as they offer a wide variety of products within the category. Two distinct segments will be addressed within this report; 1) Pet Food: Including all forms of food as well as treats, biscuits, snacks and beverages. 2) Pet Supplies: The most significant portion of pet supply sales con- sist of cat litter but also includes medicines, leashes and leads, toys, clothing, clean-up items, training aids and many other specialized items for the care of all types of pets.4
  5. 5. Defining the MarketSIC codePETCO Pet Supply Stores Standard Industrial Classification (SIC) Codehas the potential to fall several different classifications. The main in-dustries where PETCO competes are pet products, consumer productsmanufacturers, consumer services, veterinary care, retail, and non-store retail. Since PETCO competes in so many different markets, theSIC code may not be as specific as other companies.First, PETCO competes in consumer product manufacturing whichplaces it in the classification of 2047 which is dog and cat food. Organi-zations under this category “primarily engage in manufacturing of dogand cat food,” Also similar to this category and another classificationthat PETCO falls under is 2048 which manufacturers food for otheranimals.Next, veterinary services are a market PETCO also competes in. SICcode 0742 classifying veterinary services for animal specialties. PETCOoffers veterinary services where they provide vaccinations and a varietyof other health care related services. Similar to this, PETCO also offersboarding kennels, and pet grooming which belongs in the SIC 0752,Animal Specialty Services, Except Veterinary. Note: Sales of pet food and supplies, by segment, 2007 and 2009 (Mintel, 2009).Finally, PETCO Pet Supply Stores also are placed in SIC 5999 whichconsists of Miscellaneous Retail Stores, Not Elsewhere Classified whichencompasses pet food stores and pet supply stores as well. 5
  6. 6. Market Size and Growth Trends In 2010 alone, pet supply sales exceeded $10.4 billion and pet food reached $17.7 billion. The pet food and supply category has shown steady growth annually due to rising demand as pet populations rise and increasing prices and has proven to be rela- tively recession proof. Mintel forecasts continued growth at just less than 3% annually in the foreseeable future. The 2007 pet food and supply market was a very telling time as neither the economic unrest or widespread recalls seemed to have a substantial effect on category sales with 2.9% annual growth in 2007 and 3.2% growth in 2008 (Mintel, 2009). Sales were driven up in part by more expensive options, namely premium and organic options becoming more popular as consumers lost some trust in household brands due to contaminated pet food. The economic environment of 2007 did not see a decrease in sales as a whole as consumers did not quit buying food and supplies for their pets. In fact, more than half of pet owners reported cut- ting back on their personal needs before those of their pets (Mintel, 2009). Consumers did how- ever tend to turn to cheaper outlets such as Walmart and Costco Wholesale to save money. This thrifty approach to pet care did take some shoppers away from specialty stores such as PETCO as consumers searched for ways to conserve resources during times of economic unrest. Note: Sales of pet food and supplies, by segment, 2007 and 2009 (Mintel, 2009)6
  7. 7. Market ForecastMintel forecasts substantial growth between now and 2014 as petpopulations rise and pet owners increasingly view their pets as fam-ily members. Mintel forecasts the pet food and supply market willgrow more than 14% between now and 2014 with forecasted saleswell over $31 million in pet food and supplies.Like previously stated the pet market is a very strong market in therecession and remains resilient. According to Mintel, pet ownershave a vested interest in their pets and commit to feeding them thebest products and providing them with the best supplies possible.There are four main factors that influence steady growth in the petmarket. 1. Specialization: Pet owners are willing to pay a premium price for special pet foods. Pet owners have taken a special interest in organic and natural foods for their pets. 2.Inflation: The inflation in food prices has forced pet food manufacturers to push through price increases and be in novative in tactics to reduce cost such as smaller packages. Note: Total U.S. Retail Sales of Pet Food and Supplied, at Current 3.Recall After Effects: In the spring of 2007, there was Prices 2004-2014 (Mintel, 2009). a wide-spread recall of pet foods. This recall did not affect the pet food industry as extensively as many thought. In fact, the recalls motivated most pet owners to seek out “safer alternatives” in their pet food, which resulted in spending more on pet foods. 4.Increased emphasis on value: offering the highest qual ity nutrition and convince pet owners they provide this at a reasonable price. 7
  8. 8. Market Drivers Pet population is the most prominent driver of pet food and supply sales. According to American Pet Product Association, dogs and cats account for 96% of pet food sales. In the past two years the cat and dog population has risen 4% pointing to a relatively steady increase in demand. As the U.S. population as a whole ages, house holds with children under 18 decrease. Thus, we have identified the increase in the Hispanic mar- ket as a prominant market driver. Especially they continue to become evermore affluent, they are developing into a promising consumer group. Note: U.S. Pet Population (Mintel, 2009). Note: Small Animals includes rabbits, hamsters, guinea pigs, ferrets, mice, rats, gerbils, chinchillas, hermit crabs, pot-bellied pigs and hedge- hogs.8
  9. 9. Market Drivers Cont’d In addition to steady pet population growth, children in the house- hold are a major driver to owning pets. Mintel shows that house- holds with children are 77% more likely than average to own a dog and 37% more likely to own a cat.Types of pets in the household, by presence of children (Mintel, 2009). Base 2,000 adults aged 18+ with internet. 9
  10. 10. Market Drivers Continued While the pet food and supply industry has relied on the strong connection between pet own- ership and children in the past, as the U.S.’s population as a whole is aging, households with children are decreasing. In 2008 the number of households declined significantly with 69.4% of households not having children. However, Mintel forecasts a 13.9% increase in Hispanic children under 18 between 2009 and 2014. This household growth could have a powerful influence over the pet and food supply market in the next few years. Experion Simmons data indicates Hispanic households are overall less likely to own a pet, Mintel forecasts ownership rates will rise as the U.S. Hispanic population becomes more affluent. Number of children under 18 by race in HH (Mintel, 2009)10
  11. 11. The Market PlaceThere are four leading companies in the pet food and supplycategory: Nestle Purina holds a broad line of brands and productsincluding Beneful, ONE and Dog Chow. This company hasproduct offerings across a variety of price points and pet careneeds and has proven to be a competitive and successful brandas consumers tend to trust the well-recognized red and whitecheckerboard logo.Mars Inc. is a privately held brand. Their core line, Pedigreedog food, has seen recent sales declines and as a result haveseen category slip.Del Monte expanded it’s presence in the pet food category in2006 when it acquired Meow Mix and Milk-Bone brands. In2009 the company saw an overall category decline in both catand dog food. Other lines such as Alley Cat, and Gravy Trainsaw growth as they have a lower price point. Other lines thatalso saw growth included Kibbles ‘n Bits Wholesome Medleyand Meow Mix Wholesome Goodness which both offer bal-ances natural ingredients.Proctor & Gamble has two brands that have performed wellhistorically: Eukanuba and Iams. Eukanuba is a premiumproduct available only through specialty stores. Iams is also apremium brand that performs well at supermarket and massmerchant channels. P & G has focused on the premium marketwhich has helped to position them well in the pet food market. FDMx sales of leading pet food and supplies companies, 2008 and 2009 (Mintel, 2009). 11
  12. 12. The market place cont’d. Pet supplies account for 38% of total pet food and pet sup- plies sales and is the largest segment in the market. Since 2007 dog food and cat food have yielded slightly higher growth in revenue due to consumers seeking premium nutri- tion products which tend to have a higher price point. The pet food and pet supply market is divided into segments by species and function. From here they are separated into four separate segments; dog food, cat food, food for pets other than dogs and cats, and pet supplies. This research supports the earlier discussion and explanation of the SIC codes. • Dog Food: Includes all foods, treats and biscuits. • Cat Food: Includes all foods, treats and snacks. • Food for pets other than dog and cats: Includes food, snacks and other products for smaller animals. • Pet Supplies: Most significantly consists of cat litter, but also includes medicines, leashes, toys, clothing etc. These four segments do not compete directly but are related indirectly in the following ways: • Branding: Many of the top brands stretch across both dog foods and cat foods • Nutritional Trends: Natural, balanced diets have spread across both dog and cat food categories. • Budgeting: Priority is placed on superior nutrition but may result in fewer pet supplies purchased as consumers strive to save money.12
  13. 13. Dog and cat food have seen steady growth since 2004. Pet food other than dog and cat have not per- formed as well. Pet supplies, how- ever, have continued to perform well historically.Sales and Forecast of Pet Food and Supplies, by segment, at current prices(Mintel, 2009)Americas Pet Owners- Sales of Pet Food and Supplies by segment (Mintel, 2009). 13
  14. 14. Competitive position The top competitors and distributors of pet supplies are Walmart, PetSmart, and PETCO. PETCO Pet Supply Stores is the second-largest US retailer of specialty pet supplies behind PetSmart. The company has more than 1,000 stores nationwide with atleast one store in all 50 states and the District of Columbia, making it the only pet store to cover the entire US market. PETCO carries a wide selection of products varying from food to toys, beds, litter, and aquatic supplies. PETCO places a strong emphasis on their brand having something fit for every pet. They also capitalize on their 100% satisfaction guaranteed policy. Walmart is the world’s largest retailer chain with $405 billion in sales for the end of the fiscal year of January 31, 2010. Walmart has more than 4,000 facilities which include Walmart supercenters, discount stores, Neighborhood Markets and Sam’s Club warehouses (Walmart Fact Sheet, 2010). In 2009 Walmart was estimated to account for $1.4 billion in sales of pet supplies. However in 2010 Walmart has cut down in its offering of pet supplies due to the “big box” law in some communities within the United States which limits supercenters to 100,000 square feet. According to Mintel, Walmart, along with PetSmart and PETCO are among the most popular retailers who target the primary/occasional buyer of pet supplies. Pet owners who shop at Walmart seek brand names at affordable prices. These consumers may have a lower household income but does not exclude higher income consumers. Walmart is known for bringing mass quantities at the best value as well as one-stop shopping convince to the consumer. PETCO differs from Walmart, the leading competitor, in two important ways. PETCO consumers generally have a higher household income compared to Walmart consumers. The second important difference is in products available. PETCO is a specialty store for pets, where everything a pet owner could ever need or want for their pet if offered. In contrast, Walmart is viewed as a mass retailer in food and clothing and only carries the basics in pet supplies with limited selection. While PETCO excels at offering a larger variety of products, their price point is higher than Walmart which is seen by some consumers as undesirable.14
  15. 15. Competitive position cont’dIn 2006, PetSmart sales were nearly $4.2 billion. Since then Walmart has become the top retailer of pet supplies and foods followedby PETCO. PetSmart and PETCO both cater to pets bringing thousands of pet products and supplies in one location to the consumer.PetSmart, like PETCO, has created the identity of your pet being a family member. PetSmart is operating in more than 48 states and has1,160 stores in the United States. Like PetSmart, PETCO is operating in all 50 states with about 1,000 stores nationwide (“ Facts Sheet-General ”, 2011) . Both PetSmart and PetSmart on-line market offer more 10,500 different products for pets (“PetSmart Fun Facts,” 2010).PetSmart targets higher end incomes consumers. Income is strongly correlated with which stores the consumer would shop at. PetSmartoffers a PetPerks savings card, which consumers can use to receive discounts on pet supplies within the store. Other services in PetSmartstores include boarding, grooming, adoptions, training classes and even veterinary services. PetSmart and PETCO chains are seen andlooked at for their expertise in pets and a wide variety of pet supplies and pet foods. PetSmart is most similar to PETCO when comparingthe competition. Like PetSmart, PETCO offers PALS saving card for frequent consumers. In addition, PETCO also offers boarding, groom-ing, adoptions, training classes, DNA breed testing, pet medical insurance and veterinary services (“ Facts Sheet- General”, 2011). LikePetSmart, PETCO also has a green living policy to help ensure a safe environment for both our pets and family.The most important differentiating factor between PETCO and PetSmart is that PETCOshoppers typically leave the store with a higher receipt total that PetSmart shoppers. Thisshows PETCO has been successful in capturing a highly affluent consumer base which isunlikely to switch to other outlets such as Walmart. The following charts offer a com- Type PETCO PetSmart Walmart parison of popular pet food and supplies available at Walmart, Beneful Original $12.99/ 7 lbs. $10.99/ 7 lbs. $9.98/7 lbs. PETCO and PetSmart. As you will see, PETCO does have a slightly Iams Weight $21.99/ 17.5 lbs. $12.99/ 8 lbs. $17.88/17.5 lbs. higher price point in most, but not Control $38.99/40 lbs. all cases. Walmart tends to be the Pedigree Complete $17.24/ 20 lbs. $13.49/ 20 lbs. $18.24/20 lbs. majority leader in low prices while Nutrition specialty stores-such as PETCO and PetSmart tend to offer a wider Iams Premium $21.99/13.4 lbs. $19.99/13.4 lbs. $18.98/13.4 lbs. selection. Protection 15
  16. 16. Type PETCO PetSmart Walmart Meow Mix $14.49/17.6 lbs. $11.49/16 lbs. $11.77/17.6 lbs Purina One $13.40/7 lbs. $11.99/7 lbs. $10.98/7 lbs. Sensitive System Iams Proactive $13.99/6.8 lbs. $13.99/6.8 lbs. $12.77/6.8 lbs. Health The Good Life $9.99/6 lbs. $8.59/6 lbs. $9.97/6 lbs. Product PETCO PetSmart Walmart Scoop Away Cat $9.37/25 lbs. $9.99/25 lbs. $9.37/25 lbs. Litter Purina Beggin $7.99/10 oz. $12.99 25 oz. $9.92/25 oz. Strips $29.99/40 oz. Dingo Dental Stick $4.99/6.02 oz. $3.99/6.2 oz. $6.95/3.1 oz. API Fresh $31.99 $32.29 Not Available Master Kit16
  17. 17. The ConsumerSize of the Consumer Market: The size of the pet food and supply market consists of about 86 percent of the United States population who own either a cator dog. This is a very large percentage of the United States population, therefore showing that pet food and supplies are a constantneed amongst Americans. Also, about 32 percent of the US population owns another type of animal (fish, bird, reptile, rodent, rab-bit, or ferret) (Mintel Market Drivers, 2009).Purchasing Habits and Usage: In 2009 the estimated sales of pet food and supplies were about 27.5 billion dollars, which is an increase of 2.9 percent over2008 (Mintel, 2009). Specifically the purchasing habits among pet owners have become more about nutrition trends. “Theidea of natural, balanced, diets has spread across both dog and cat food. Specializationis also prevalent in other pet food, where specific varieties exist at the species and evensub-species level” (Mintel America’s Pet Owners). Since the importance of nutrition has increased, pet stores have seen asmall decrease in the buying habits of pet supplies like toys. Mintel states that it could be a trade-off that pet owners are willing tospend more money on food rather than buying an unnecessary amount of toys.Older people that own an animal, specifically a dog or cat, will most likely buy weight management food for their pet. This showsthat older people most likely have older pets and will provide care for their animal that is similar to their own lifestyle needs.Younger owners of pets who most likely have children in the house are more likely to feed a healthier choice to their animal, just asthey would to their own children (Mintel, 2009). 17
  18. 18. The Consumer Cont’d Pets by Presence All Children in No Children in Today’s PETCO con- of Children % HH % HH % sumer is likely to have at least one child in the Dog 44 62 35 household. Cat 33 41 30 All 18-24 25-34 35-44 45-54 55-64 65+ % % % % % % % Pet ownership is rela- tively equal across HH Owns a 40 48 40 45 46 37 26 agegroups. Specific to Dog PETCO, shoppers tend to HH Owns a 28 32 29 31 31 27 19 be older, simply because Cat they have more dispos- able income. HH Owns 58 63 62 63 65 55 39 any Pet All Under $25k- $50k- $75k- $100k- $150k+ $25k 49.9k 74.9k 99.9k 149.9k Pet ownership is relative- % % % % % % % ly low with consumers whose income is under HH Owns a 40 28 33 44 48 45 50 $40k. Above $40k, in- Dog stance of pet ownership HH Owns a 28 20 26 30 31 34 30 is significantly higher. Cat HH Owns 58 44 51 62 64 66 66 any Pet18
  19. 19. Total 18-24 25-34 35-44 45-54 55-64 65+The Market Adults with internet access who own a % % % % % % dog For Companionship 86 90 83 85 84 85 For Security 48 56 53 47 48 39The main reasons for a consumer Because I have 46 54 43 41 48 45to own a pet is companionship and always had onesecurity. About 86 percent of dog Other 8 4 6 8 9 7owners and about 75 percent of catowners believe that companion-ship is the most important reasonfor owning a pet in the household. All One or More No Children % Children %Reports from Mintel show that the %average pet owner would be Cau-casian, between the ages of 45-54, HH Owns Pet 58 63 55have children, and have a higherincome. Children play a large part HH Owns a 40 44 38when owning an animal and it Dogshows that about 63 percent of the HH Owns a 28 29 28US population has one or more Catchildren in a household with a pet(Mintel Pet Owners) HH Owns a 14 17 13 Cat and Dog HH Owns a 8 14 5 Fish 19
  20. 20. Attitudes and Knowledge Since most pet owners have pets for companionship and security, they are most likely to purchase food and supplies that best supports their pets health and longevity and look at these purchases as an investment in their pets longevity. When selecting pet food and supplies owners seek quality products just as they do for their own personal purchase needs. Owning a pet also increases the owner’s quality of life. A study showed, “The most common theme is improved health and well being, and among the many specifics are stress reduction, prevention of depression, lower blood pressure, and reduced risk of heart disease” (Mintel, 2009). Pet owners are aware that they can actually improve their own lifestyle, and have that sense of care and compassion simply by having a pet in the household. Factors Influencing Brand Selection: Most of the consumers who own a pet are aware that their pet’s nutritional needs change as they age. As said before, older animals will need a weight management diet whereas younger animals will need a diet with a lot of nutrition to support healthy bone, joint and muscle growth. Consumers with a higher income are more likely to buy more expensive food for their animal, whereas lower income buyers are more likely to buy a store brand product to save money.20
  21. 21. Advertising HistoryAdvertising for leading pet supply retailers uses powerful emotion in their In 1999, the PETCO Foundation began incorporatingadvertising campaigns to gain consumer awareness and support. By focusing charitable giving into their advertising to raise aware-on the idea that pets are more than animals, but like members of the family, ness and funding by donating to help save millionsconsumers feel the need to provide top care for their pets. The majority of pet of abandoned animals. By its 10th year in 2009 theowners consider their pet(s) to be part of the family and are thus interested in PETCO Foundation had raised nearly $70 millionpurchasing products that will guarantee longevity and quality of life. Adver- dollars to help more than 7,000 animal welfare part-tising within the industry has both reflected on and created these notions ners nationwide.through the use of powerful messages with a strong emotional appeal. In 2004, PETCO sponsored a brand new ballparkAdvertising Spending: in downtown San Diego which they named PETCO Park. The park has capacity for over 42,000 people,Currently, Walmart is the leading pet supply retailer followed by PetSmart which boosts exposure to PETCO advertising. PETCOand PETCO. Walmart increased advertising spending in 2008 for their pet launched an advertising creative tagline of “PETCO,care products due to sales in pet supplies remaining consistent despite the where the pets go.” This message was effective at ap-poor economy. pealing to consumers and helped PETCO become a more recognizable pet supplier.According to Kantar media, from January through October 2010, PETCOspent $12 million on measured media in the US. In comparison, during the Advertising expenditures:same time period, PetSmart spent $58 million in advertising. In 2011, PETCO PETCO- $12 millionis looking to increase spending in advertising and promotions. PetSmart- $58 millionPETCOWhen PETCO- originally called UPCO or United Pharmaceutical Compa- Despite spending relatively low amounts of money onny- opened its first retail store in La Mesa, California in 1976, the company advertising (compared to other companies) consum-mission and advertising campaign was to provide quality pet and veteri- ers reported remembering PETCO’s slogan more thannary supplies to sell to the public as well as animal professionals at lower leading companies including one of its top competi-discounted prices. In 1995 PETCO became known for also providing pet tors, PetSmart (Maquire, 2005). The message behindservices such as grooming. That year they also launched a customer loyalty this campaign is that people shop for themselves atprogram, PETCO Animal Lovers Save (P.A.L.S). supermarkets, because they are specialized in prod- ucts “for people.” Pets deserve to have products that are specialized for them, at PETCO. 21
  22. 22. Dealers/ Distributors/Brokers Pet stores and vet offices dominate as the most trusted distribution channels for pet food and supplies. While other channels exist including supermarkets and mass merchandizers such as Costco, consumers tend to prefer channels that can offer convenience, value and expertise. The top five retailers at Walmart, PetSmart, PETCO, Supermarkets, Target and mass merchandizers (in order). In 2010, the combination of these channels brought in more than $8.5 billion. The leading manufacturers are Nestle Purina, Clorox Company, Hartz Mountain Corp. and Church & Dwight and Co. Inc. The current sales leader Walmart thrives on offering one of the most valued attributes- low price. Stores like PETCO can leverage their offering of quality, expertise, variety and durability of goods. PETCO stores use 10 distribution houses located across the U.S. PETCO and PetSmart are different than other retailers because they offer online retail services. And the stores offer perks which other stores are unable to offer, because majority of smaller competitors have fewer stores resulting in less profit. Both of these stores also offer in store services in addition to products. The services include, boarding, grooming, adoptions, vets, training class- es, and a unique experience which is, you can shop with your pet. Also “salad bars” of dog bones offer consumers the opportunity to shop for your dog an alternative way. Petco employees are responsible for unloading products from packages and stocking shelves. Employees restock shelves once a week.22
  23. 23. Sales PromotionThe primary focus of their products is quality. PETCO states that In regards to promotional packaging, PETCO also utilizes Quickits brand is the “name you trust and the quality you demand, all for Response codes on their pet supplies to promote interaction asa great value”. PETCO uses a lot of couponing tactics to generate well. They also have printable coupons for their consumers tosales and encourage consumers to purchase and try their products. access on their website and print them off to redeem them andSome other promotions PETCO utilizes to drive brand interactions receive sales on their PETCO supplies, products and services.and purchases are sweepstakes and contests. Another major promotional tactic that PETCO has developedPETCO ran a “Once a day $50 Gift Card Giveaway” Sweepstakes. is their PETCO PALS club. This club has a free membership soIt began November 27th 2009 and ended on December 31, 2009. In there is very little risk for their consumers to join. Once consum-this sweepstakes, contestants could enter themselves through email ers join they can immediately begin to enjoy the benefits PETCOfor a chance to win a $50 gift card to use on their favorite PETCO has to offer. Right away consumers enjoy exclusive offers andpet supplies. They could enter themselves once a day for 34 days. rewards as well as are up for customized offers. When consumers shop with their PETCO PALS club they can save money instantlyPETCO also ran a sweepstakes called “PETCO Sweepstakes” with PALS. The PALS club offers storewide savings on productswhere contestants could answer trivia questions regarding facts ranging from supplies and a wide selection of nutritious foodabout PETCO as a company and if answered correctly they could to incredible toys and treats. PALS also allows consumers to bewin a PETCO gift card with a $50 value. This promoted the brand invited to exclusive invitations to pet-co friendly engaging the contestants as well as integrating trivia facts aboutPETCO in a fun and interesting way. Another sweepstakes theyran also called “PETCO Sweepstakes” where PETCO shoppers PETCO also has many ways on their website to inte-could stop in at any PETCO store and fill out an entry form to win grate their consumers into their products. They have blogs whereone of 3 Ford Escape hybrids, plus a gas card for a year. By filling people can join and meet other pet owners and share stories,out this form contestants could also be up for winning one of over advice, and information on products regarding their pets. They5,000 $25 or $50 PETCO gift cards. This sweepstakes ran August also include upcoming events going on that includes pets for their24th 2008. PETCO also ran the “I’m home with PETCO” sweep- consumers to participate in which further promotes their brand.stakes where contestants could win a $2500 PETCO gift card and amatching donation to their favorite shelter. 23
  24. 24. SALES PROMOTION- Internet The internet has proven to be a very successful advertising medium for PETCO, raising awareness about the company and boosting sales. The PETCO website, launched in 2000 utilized emailing and helped gain loyal customers by giving special deals, coupons, and pet care information. Keep in mind, in 2000, few compa- nies were truly leveraging the internet to create a online business process and the early adoption of PETCO gave them an edge in a relatively clutter free cyber world. In the infancy of their online advertising, PETCO offered coupons for PETCO products, free products such as small bags of dog food, and discounts on various merchandise. This helped build a strong customer base and gain purchasing out of the store. To make the website personal, PETCO began an e-mail campaign targeting pet owners by type. Pet own- ers had an option to register information on their pets that allowed PETCO to email recommendations on specific products and information to better support and care for their individual pets (Maguire, 2005) Using an internet review application from BazzarVoice, in October of 2006, PETCO incorporated an area to post consumer reviews of products and services provided by PETCO on their site. This enabled custom- ers to share their true opinions and thoughts about PETCO products for other customers to see. This helps build trust in the company and at times has proven to be more successful that traditional, company spon- sored advertising. For the email campaign, PETCO chose six top-rated products for each pet type and included positive re- views on these products and sent them to matching pet-type owners on the mailing list. This helped boost the image the PETCO is indeed “where the pets go” to get quality and personal care. Email recipients could click-through on the message to read the rest of the featured reviews, as well as other reviews of the prod- uct. Vice President of E-Commerce said that emails containing reviews had a 200% higher click through rate (Internet Retailer, 2008). The website currently sells everything from dog clothing to grooming kits and has helped the company rise to one of the countrys largest animal and supplies retailers. In addition, PETCO launched a specialized newsletter with animal care information and excusive offers available on their website. This campaign was especially successful in its early years and currently has al- lowed PETCO to obtain the number three spot for most online purchases for a pet supply retailer (Mintel, 2009).24
  25. 25. Social Media:PETCO joined the social media bandwagon and has a Twitter and Facebook account as well as a YouTube channel. These social mediasites allow followers to interact and connect with other pet owners, share experiences and recommendations, and get expert advice. Inaddition, these channels help to create a sense of community between PETCO shoppers.Television:Television is one of PETCO’s primary mediums. The visuals used in their commercials feature pet owners spoiling their pets and thenconcluding with the tagline “PETCO . Where the pets go.” In one ad, two pet owners are bathing their dog as they bathe themselves in abubble bath. An announcer’s voice proclaims. “People shop for people at supermarkets. Pets shop for pets at PETCO.” Through televi-sion ads, an image of loving pet owners caring for their pets is conveyed.WalmartLeading the market with top sales in pet supplies is Walmart noted for providing brand names at low prices (Mintel, 2009).Walmart ads focus primarily on low prices using “pet food at affordable prices” as its category title and slogan. Their website fea-tures top brand names for the market such as Iams and Purina One at lower prices. However, their Ol-Roy brand which is verycost affordable leads the category with top sales.PetSmart:Publicis Group created PetSmart’s current tagline- “That’s smart. Pet smart”. Their ads feature a relatively similar message toPETCO that pets deserve quality products. PetSmart’s mission is “we love to see healthy, happy pets” and highlight this state-ment in their ads and frequently throughout their website. The image of PetSmart products and services show just that: healthy,happy pets. PetSmart also uses television, internet, and social networking sites to build brand awareness. 25
  26. 26. PetSmart PetSmart is one of PETCO’s biggest competitors because the two companies are so similar. PetSmart utilizes couponing, discounts, and promo codes to drive consumers to pur- chase their products. PetSmart also ran a sweepstakes called the “Science Diet PetFit Challenge” where contestants could enter and have a chance to win $500,000 along with many chances to win gift cards with up to a $100 value. They also ran a sweepstakes called “Super Summer Re- wards Sweepstakes” where consumers could enter to win one of two cars or other prizes. Costco Costco is a major competitor to PETCO because they sell their products in bulk at a great value. They also have a satisfaction guaranteed policy on their products as well. Costco has a huge variety of products consumers can purchase. Costco offers customers a “one stop” approach. Not only can consumers buy their pet food and supplies at Costco but they can also purchase the groceries, medications and other home items they may need as well. This entices consumers to purchase their supplies there because it is convenient and not nearly as time-con- suming as making several stops at different locations to get the items they need. Costco offers a lot of savings on their products through coupons. They also use a lot of promotional tactics such as sweepstakes and contests. One sweepstakes Costco ran during the holiday season was called “12 Days of Giveaways”. Contestants could win full-HD televisions, cross trainers, luggage sets and much more. Daily instant prizes included items such as GPS systems and Bluetooth head- sets. They could also be up for winning the grand prize of a $1500 Costco gift card. Walmart Walmart is another major competitor to PETCO because they sell products at very low prices. They place a strong emphasis on selling their products at prices that are affordable to the majority of people. Their pet supplies and pet food is sold at a lower price than other stores. For those consumers who are finance-conscious or simply like to purchase their products for low prices this entices those to become loyal to Walmart. Walmart also utilizes couponing and promo codes as ways for their consumers to redeem and receive savings on all their Walmart products. Walmart also ran a sweepstakes called “$25 Walmart Gift card Sweepstakes” where consumers could enter online and fill out an entry form for a chance to win a $25 gift card to use on Walmart products. Another sweepstakes Walmart ran was called the “Lucky Fan” sweep- stakes. In this sweepstakes contestants could enter and be up for winning a $50 gift card to use on their Walmart purchases.26
  27. 27. Strengths SWOTPETCO is a specialty store that of- Weaknesses Opportunitiesfers much more than your average More than half of Ameri-supermarket or mass-retailer such PETCO is viewed as expensive can households own a pet. Withas Walmart. At PETCO not only is and during times of economic children being an indicator foryour pet welcome to shop with you depression consumers tend to pet ownership and the 15% pro- Threatsbut multiple services are available turn to stores with lower price jected population growth of the Many consumers wantto you and your pet such as groom- points such as Walmart. 18 and under Hispanic popula- to be able to shop at a special-ing, obedience classes, veterinary Lack of brand identity. tion in the next few years there ty store but either can’t affordservices and treat bars to make Consumers tend to know of is a strong opportunity for this it or need the convenient ayour pets shopping experience PETCO but don’t choose them market to be captured. supermarket or mass retailerenjoyable. as their number one choice In addition, the Hispanic offers. The average PETCO shop- for purchasing pet food and population as a whole is more American householdsper is a fairly affluent one with a supplies. PETCO was founded willing to pay the higher price of with children in home are onrelatively high income and educa- in 1965 but still comes in 3rd premium, organic food products the decline.tion level. PETCO shoppers tend after Walmart and PetSmart. and are also more likely to spoilto spend more at the point of their pets with toys, treats andpurchase which shows a tendency luxury bedding utilize services and selection. Due to the 2007 recalls people are turning more to natural, organic and premium options and a brand/service they can trust. PETCO meets all of these criteria where many of their competitors do not. Despite the economic downturn, pet food and supply sales continue to flourish. In fact, according to Mintel, some people may even be driven to acquire a pet or become closer with their existing pet to help relieve stress. 27
  28. 28. CAMPAIGN OBJECTIVES -Launch a comprehensive consumer and trade compaign to adress the challenges PETCO currently faces -Target men and women ages 24-35 years old with an emphasis on first time pet owners -Drove consumers to PETCO store for the purchase of pet food and supplies over mass retailers -Position PETCO as a company completely unique to it’s category-expertise and trust of a lifetime -Generate consumer interest and trust around PETCO -Stay within a budget of $9.6 million28
  29. 29. PRIMARY RESEARCH To help develop the PETCO campaign and identify an overall objective and theme, we conducted primary research using an online survey. The survey was distributed to adults between the ages of 25-34 and asked questions regarding shopping preferences and media habits. We also asked questions about what they look for in a frequent shopper program to help enhance the existing PETCO Pals program. 137 respondents participated in the online survey. The survey revealed several insights about peoples purchase preferences regarding pet food and supplies. Costco was the leading an- swer for the preferred/frequent place of purchase for both pet food and supplies. Walmart came in second followed by supermarkets for pet food and PetSmart and PETCO for the purchase of pet supplies. Respondents reported price and quality as being the two most important factor when shopping for pet food and supplies. This is parallel to the data we found on Mintel which stated consumers are in a constant struggle nowadays to not sacrifice quality for price. When asked what perks respondents would like to see in a frequent shopper program the most common answer was discounts for frequent shoppers and coupons tailored to the products they purchase. Overall, customers want to be rewarded for their loyalty which is important in today’s highly competitive market. Other significant findings included: -Internet reported as the most frequently used media followed by television and radio. -Respondents reported being more likely to trust information about a product provided by an actual user rather than information distributed directly from a company. -Less than half of respondents reported interest in a free-online nutritional consult. -Respondents reported they would feel swayed to shop at a store they knew was participating in charitable causes for homeless pets over a retail channel that was not.“ I want coupons and discounts tailored towards my pur-chase preferences.” -Survey respondent 29
  30. 30. Target Audience Recommended target: Through a national campaign, PETCO will target consumers as well as more niche groups such as breeders and veterinarians through various media channels and promotional activities. Through exten- sive primary and secondary research, we have developed a specific recommended target audience for your consideration. The recommended primary consumer is white, married adults be- tween the ages of 25-34 with at least a four year college degree and an income of $40,000 or above. This consumer is likely to be at the point in their life where they are looking to start a family. This demographic is unlike today’s PETCO shopper for several rea- The following table illustrates instance of pet ownership by sons. Today’s PETCO shopper typically has a higher income, is older age group. As you can see, pet ownership is well performing and shops at PETCO because they seek higher end items for their pet, well through mid-life and only decreases around the age of not unlike their personal purchase preferences. Instead of focusing 60+. For the purpose of this campaign, however, we recom- this campaign on attracting more of the same consumers, we recom- mend targeting the younger demographic to capture first time mend a different approach. pet owners who may be more willing to shop at a store offer- ing expertise and who also have a higher potential to become The younger demographic we suggest is promising for several reasons. loyal PETCO shoppers. First, this audience is likely to capture many first time pet owners. First time pet owners tend to spend more money on food and supplies to Age Horiz% Vert% Index ensure they are taking good care of their new companion and are more 22-24 2.19 41.2 77 likely to splurge on luxury items such as toys and vanity goods such as 25-29 8.49 61.5 115 rhinestone accessories. Next, while this demographic does not have a large income at this point in their lives, since most of our target audi- 30-34 10.9 55 103 ence has a college education, that their income will increase over time 35-39 9.68 61.2 114 making them a valuable asset to the PETCO consumer base. In addi- 40-44 10.3 59.2 110 tion, capturing this demographic before they have developed loyalty to another pet food and supply outlet will help to generate lifetime users.30
  31. 31. Pet ownership between females and males is relatively equal. Thus, it isimportant to target both males and females. It is worth noting, however,that females do have slightly stronger numbers and tend to do more of thehousehold shopping than men so a slight skew towards females might bedesirable. Gender Total <000> Horz % Vert % Index <000> Male 47,509 24,124 39.3 50.8 95 Female 66,898 37,237 60.7 55.7 104Whites have the highest instance of pet ownership. That is not to say thatother races do not own pets. In fact, with the projected population growth ofHispanic children under the age of 18 at 15% between now and 2014, they arean important group to keep in mind throughout the campaign. Race Total <000> <000> Horiz % Vert % Index White 61,360 52,618 85.8 59 110 Black or 61,360 3,965 6.46 29.2 54 African American Asian 61,360 1,111 1.81 27.8 52 Some Other 61,360 3,666 5.97 50.7 95 Not White or 61,360 4,776 7.78 42.6 79 Black 31
  32. 32. While people across all income levels own pets, we do not begin to see consistently well performing numbers until 40k and above. We recom- mend targeting this demographic as they might have more disposable income than lower income groups and be willing to spend their money providing for and even pampering their pet. Education Total <000> <000> Vert % Horiz % Index Graduate Degree 10,876 3,108 15.7 28.6 161 Graduated College or 30,032 7,953 40.1 26.5 149 more 4 Year Degree 15,728 3,992 20.1 25.4 143 Attended Grad. School 3,428 853 4.3 24.9 140 No Degree 2 Year Degree 13,419 2,440 12.3 18.2 103 Attended College 1-3 32,920 5,401 27.2 16.4 93 Years Attended College Less 25,941 4,266 21.5 16.4 93 than 1 Year32
  33. 33. HH Income Total <000> Horiz % Vert % Index <000> 20,000-24,999 6,282 3,222 5.25 51.3 96 25,000-29,999 6,561 2,899 4.72 44.2 82 30,000-34,999 5,647 2,357 3.84 41.7 78 Married people are more likely to own a pet than any other marital status reported. 35,000-39,999 5,950 2,793 4.55 46.9 88 Not only are married people more likely40,000-44,999 5,509 3,053 4.98 55.4 103 to live in a place where they can own pets, they are likely looking to start a family 45,000-49,999 4,723 2,484 4.05 52.6 98 and a pet can be perfect practice for tak- 50,000-59,999 9,229 4,912 8.01 53.2 99 ing care of a family. Since children are a driver for owning a pet, if the couple 60,000-74,999 11,166 6,533 10.6 58.5 109 already has children it makes them even 75,000-99,999 13,832 8,351 13.6 60.4 113 more appealing.150,000-249,999 7,751 5,081 8.28 65.6 122250,000-499,999 2,551 1,625 2.65 63.7 119 Marital Total <000> <000> Horiz% Vert% Index Status Education is an influential factor in pet ownership. As you can see in the chart below, the more educated Presently 55,378 34,051 55.5 61.5 115 a person is, the more likely it is that they will have a Married pet. We recommend targeting those with a 4 year de- gree. Although having a graduate degree has a higher Widowed 11,676 4,374 7.13 37.5 70 index number, it represents a much smaller segment of the population as a whole. In addition, there is high Divorced 17,300 8,827 14.4 50.9 95 correlation between education and income. Since PETCO has a slightly higher price point, it is impor- Separated 3,388 1,676 2.73 49.5 92 tant to market to those with a higher level of dispos- able income. Never 26,635 12,432 20.3 46.7 87 Married Not Married 59,029 27,309 44.5 46.3 86 33
  34. 34. SUMMARY: The demographic we have outlined above has the greatest growth po- tential for PETCO. These consumers have not developed loyalty towards a specific retail outlet, are likely seeking quality goods for their first time pets and as a result are a very promising group for PETCO to market towards. Through secondary research, we derived 8 Pet Loving Cities which Within these regions, we have identified 8 cities within we have identified as key market areas for the PETCO campaign. 5 states to serve as key markets during the PETCO cam- These cities were chosen based on Simmons Choices 3 data indicat- paign for use as test markets and focal points for out- ing high instance of pet ownership by region, as well as consider- door advertisements and promotional events. ation for high population and being considered pet friendly by it’s residents. As illustrated by the chart below, the regions with the These include: highest instance of pet ownership are the mid-west, the south and the west. · Portland, OR · Los Angeles and Long Beach, CA Geographies Total <000> <000> Horiz % Vert % Index · Chicago, IL North-East 11,914 1,766 14.8 8.48 81 · Austin and Houston, TX Mid-West 11,914 2,832 23.8 10.9 105 · Jacksonville and Orlando, FL South 11,914 4,633 38.9 10.8 103 · Los Angeles, CA 46.5% West 11,914 2,683 22.5 10.9 105 · Long Beach, CA 35.8% · Austin, TX 30.5% · Houston, TX 37.4%34
  35. 35. It is important at this time to mention the presence ofHispanic population in these key market areas. Accord-ing to the 2010 census, there is substantial presence of theHispanic population in 4 of our key market areas (2010Census).The Hispanic market is important to consider in keymarket cities as the projected growth within the Hispanicmarket for children under the age of 18 is 15% of the popu-lation between now and 2010 (Mintel, 2009). In theseareas we will be conscious of spillover to the Hispanicpopulation when choosing recommended media and pro-motional activities. 35
  36. 36. Selected Emphasis Regions36
  37. 37. Media Plan Media Objectives• Stay within a budget of $4 million.• Leverage media and sales promotion to reach adults 25-34.• Reach niche markets including trade, pet friendly cities and areaswith high Hispanic population.•Reach recommended consumer target audience using cable TV, radio,internet and outdoor.•Use trade magazines to reach breeders and veterinarians to establishPETCO as a quality retailer to recommend to first time pet owners.•Build brand identity and differentiate from mass retailers such asWalmart using quality and expertise. Media Rationale We recommend selecting media based on cost efficiency and having high appeal to our target au- dience. In addition, it is important to be conscious of spillover to the Hispanic population as they will be an important up-and-coming consumer base. 37
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  52. 52. Radio Our research shows that radio ranks very high among our target audi- Chicago, another chosen target market for media emphasis, ence. With an index number of 116 in Quintile I, Radio is ideal to reach we have chosen WVAZ-FM which serves a primary target our target audience effectively. Based on our recommended target audience of women 25-54 with a format of Urban Adult Con- cities, we have choosen the top radio stations in those areas to increase temporary. media coverage. In Austin, we have selected KASE-FM which hosts a Country Radio Total <000> Vert Horiz Index format and primarily targets persons 25-54. <000> % % In Portland, we have selected KXJJ-FM which also hosts a Country format and primarily targets person 18-54. Another Quintile 20,411 2,276 21.2 11.2 116 I station we have selected KINK-FM which provides an Album Adult Alternative format with a primary target audience of Quintile 21,360 2,638 24.6 12.3 129 person 25-54. KRSK-FM is the final station we have selected II in Portland. KRSK hosts a Hot Adult Contemporary format Quintile 20,045 2,198 20.5 11 114 with a primary target audience of persons 25-34. III In the Houston-Galveston area, we have chosen KODA-FM, Quintile 19,932 2,312 21.6 11.6 121 IV which similar to the other stations host an Adult Contempo- rary format with a primary target audience of persons 25-54. Quintile 26,290 1,755 16.4 6.68 70 V Finally, in Jacksonville, we have chosen WQIK-FM which hosts a Country format with a primary audience of persons Los Angles, which is one of our chosen target areas for added me- 25-54. diaemphasis, we have chosen KIIS-FM and KKGO-FM. KIIS-FM’s provides a format of contemporary hits and serves a primary target Each recommended radio station is chosen to effectively market is women 18-49 with a secondary target of persons 18-49. reach our target audience. In consideration of the stations KIIS’s target audience is ideal to the target audience we recommend. target audience and the format, Country, Contemporary KKGO-FM is out other selected station in Los Angeles which pro- Hits, and Adult Contemporary are the best formats for our vides a country format. KKGO serves a primary audience of persons audience. 18-49 and a secondary target of persons 25-54. Both stations offer us the ideal target audience and format to effectively reach our market. (SRDS)52
  53. 53. Television TV Total <000> Vert Horiz Index <000> % %Research has shows that our target audience of adults ages 25to 34 are heavy viewers of prime time television. Realistically, Quintile 21,003 2,465 23 11.1 116 Iprime time network buys are not conducive to our campaigndue to exceptionally high spot costs. But Cable TV is very ideal. Quintile 22,118 3,874 19.5 17.5 99Through a cost efficiency approach, we recommend the follow- IIing for television. We recommend running our spots on E!’s Quintile 20,675 3,388 17.1 16.4 92Khloe and Lamar, TLC’s Extreme Couponing and Cake Boss, IIICMT’s Singing Bee, Comedy Central’s Tosh.O, Discovery’sDeadliest Catch, and A&E’s Criminal Minds. By running our Quintile 21,082 3,713 18.7 17.6 99 IVoriginal commercial on these cable channels during the primetime hours, PETCO will obtain the highest exposure to our Quintile 27,039 5,235 26.4 19.4 109target audience. V Out of Home Outdoor Total <000> Vert Horiz % Index To supplement our television and radio spots, we <000> % recommend out of home in the format of billboards Quintile 21,405 2,331 21.7 10.9 114 to be placed in our target DMAs. Our target audi- I ence responds highly to outdoor advertisements with an index of 169 in quintile I which makes this Quintile 22,016 2,176 20.3 9.8 103 II recommendation ideal for this campaign. Through Clear Channel Communications, we have identified Quintile 22,237 2,308 21.5 10.4 108 specific billboards that we will utilize in our multi- III faceted campaign. Quintile 22,883 1,919 17.9 8.38 88 IV Quintile 23,378 1,988 18.5 8.5 89 V 53
  54. 54. Trade Magazine Finally, trade publications such as AKC Gazette, Veteri- nary Medicine, and PetAge are recommended to reach an important niche audience. By placing advertisements in these trade publications, professionals such as breeders and veterinarians will be exposed to the PETCO brand and promote the expertise that PETCO has to offer it’s custom- ers. Internet Internet use is also exceedingly high with our target audience. Creating Veterinary Medicine reaches over 50,000 companion- a website that compliments the “first time” concepts will help increase animal veterinarians in their circulations and provides a the gross rating points we are looking for in this campaign. The target print and digital version of their publication. Placing ads audience of adults ages 25-34 are 69% more likely to use the internet in this trade publication will allow us to reach the ultimate than the average consumer. Tailoring the site to the first time pet own- influencers in pet care and ensure that the PETCO will ers we are focusing on will yield spillover to the general consumer base be promoted with the knowledge and backing of animal and increase overall exposure to PETCO. professionals. Publishing ads in PetAge will enable us to reach other Internet Total <000> Vert Horiz Index retailers and manufacturers of pet food and supplies. Pet- <000> % % Age reaches over 25,000 pet food and supply manufactur- ers and small retailers in circulation. These publications Quintile I 14,713 2,378 22.2 16.2 169 suggest industry trends, product innovations, and animal care. Utilizing PetAge’s consumer base for further influ- Quintile II 14,042 1,746 16.3 12.4 130 ence into our audience will pose PETCO at a great advan- tage. Quintile III 14,029 1,528 14.3 10.9 114 AKC Gazette reaches over 35,000 readers in circulation including breeders, pet enthusiasts and many other deci- Quintile IV 14,291 2,156 20.1 15.1 158 sion leaders. AKC Gazette focuses on news on purebred dog breeding and showing, health and grooming, and even Quintile V 14,488 1,157 10.8 7.98 83 legal issues concerning dogs and the field of breeding. Ideally, reaching these consumers will help instill PETCO’s expertise in the minds of breeders and influencers.54
  55. 55. Mobile ApplicationMintel and Simmons Choices 3 both show heavy smart phone usage with the recommended targetdemographic of adults 25-34. In addition, the Hispanic population also exhibits very high usage of smartphones making the channel very conducive for use in the PETCO “first time moments campaign.” In orderto keep PETCO in the minds of our target market we propose an application that will accomplish this. Wewill introduce this app at the beginning of our campaign as another way to remember that PETCO is there forfirst time moments and every step of the way. By having an app on a smart phone our consumers will have aconstant reminder that PETCO is the pet supply merchandiser that truly wants to be involved in lives of ourconsumers by encouraging them to capture all the precious moments that occur when someone starts to carefor their first pet. The app will allow anyone with a smart phone to take pictures of their puppies and uploadthem to site that shares the pictures publicly. This way family and friends or fellow pet owners can compareand gawk over precious puppy photos in a scrapbook format. In order to encourage consumers to use this app,we will award the submission with the best picture at the end of every week with a dollar amount. Site viewerswill have the ability to “love” their favorite photos. The photo with the most “loves” will be awarded.Media considered but not recommended…Network Television: Network TV is a hugely effective way to reach any audience. Research showsthat our audience is 16% more likely to watch prime time network television than others. However,taking cost efficiency into consideration, cable television was a better choice to stay within ourbudget.Consumer Magazine: Reaching our audience through visual communication is ideal for effectiveinfluence. Yet, consumer magazines are not represented well within our target audience. With35% of our audience represented in Quintile III, consumer magazines are not ideal for use in thiscampaign. 55
  56. 56. Creative Objectives -Position PETCO as the one-stop-shop that is there for pet owners from the time they acquire theri first pet throughout the pets life. -Use knowledge and emotion to appeal to the target audience -Build brand awareness -Reach consumers and trade audiences with a single compre- hensive message -Stay within a budget of $1.4 million for creative production costs. CREATIVE CONCEPT The foundation of the “first times” creative concept stems from the idea that first time pet ownership is a precious experience that calls for special care. This time can also be confusing and leave first- time-owners with a lot of questions. We recommend positioning PETCO as the place that can help take the guess work out of the process with their expert employees, products and services that cater to the difficulties first time pet owners face. The inspiration behind the creative concept came from the feeling of excitement first-time parents experience. We projected these emotions onto first-time pet owners to develop a creative campaign with “legs” to be used across several mediums.56
  57. 57. Trade Magazine 57
  58. 58. Trade Magazine58
  59. 59. Television Visual: Audio:A puppy runs into the water off a wooden dock in slow motion. A woman narrator with a gentle voice speaks: first times can be messy like,The puppy lands in the water with a giant splash. Then the camera (MUSIC UP AND UNDER, Splish-Splash/Bobby Darin): The firstfreezes the frame. swim…The puppy comes out of the water and shakes off his wet coat. Pro- The first roll in the mud…ceeding to plop into a giant mud puddle near the lake shore. Then thecamera freezes the frame.The puppy continues to shake and the owners ( a young man and The first trick...women wave for him to stop). The puppy sits, tilts his head, then theframe freezes.The commercial cuts to a backyard with the puppy a tin bath tub To the first bath.squirming about. The frame freezes.Then commercial cuts to the dog pulling the owner through the sham- So... get help from PETCO. PETCO knows which shampoo willpoo isle. The puppy spot the grooming window and the frame freezes. help to keep knots away and coats shiny... and PETCO offers in store grooming. Let PETCO take the stress out of your first times. For first times, and every step of the way. 59
  60. 60. TheTV Storyboard60
  61. 61. Radio SpotThe Narrator is a woman pet owner with a gentle and honest voice:Narrator: “The moment we saw the puppies at Petco, we knew which one we wanted to adopt. He was small and clumsy.”Puppy (A small childlike boy voice/ high pitched: “I tried to stand out amongst all the puppies! I barked loud and fell into my waterbowl...But I did it right!”Narrator: “We were newlyweds and our puppy practice for our child on the way, so we wanted the best of everything. PETCO gave usexpert tips on products and services to care for our new family member.”Puppy: Now I’m the luckiest puppy in the world because my parents shop at PETCO.Narrator: From my first pet, to the first shopping spree ...with many more first moments come, I trust PETCO to be there ever step ofthe way. 61
  62. 62. The Mobile Application62
  63. 63. Internet 63
  64. 64. Billboard64
  65. 65. Promotions Rationale:One of the main objectives of the first time moments campaign is to drive consumers to PETCOover mass retailers. In order to differentiate PETCO stores from the mass merchandisers we sug-gest running promotions that shows consumers that PETCO understands the importance of petcare and perceiving pets as part of the family. Specifically, our promotions will encourage firsttime pet owners to shop at PETCO to take the frustration away of owning a new pet. PETCO willtake away the guesswork of owning a new pet whether it may be figuring out the appropriate food,perfect pet toy, and other products that will fit their new pet adequately. Each promotion hascreative intuitions that correlates with the campaign message, and are dispersed throughout theyear-long campaign. Promotional Events: Sales promotions at different events for PETCO’s new campaign will make consumers aware of their specialty products and get PETCO involved with the consumers on a more personal basis. Since the focus of the campaign is generated towards “first time moments”, different events throughout the designated target markets will give PETCO the opportunity to communicate with the consumers about different products and services for those moments. Specifically, small gift bags that include certain products that will help the consumers ease in to their new lives of owning a new pet. An obedience trainer will be on site at each event, so new time pet owners can learn more about properly training their new puppy. Also, for the pet friendly events PETCO booths will have a photo booth that consum- ers and their pets can take pictures for “first time memories.” These particular events chosen have high attendance rate in the cities and most of them are pet friendly, therefore their pet pal can join them throughout the whole event. 65
  66. 66. Gift Bags: These gift bags that will be handed out at each event (minus the North- west Pet & Companion Fair in Portland) so consumers can take them Insert home and become more aware of PETCO’s special products. Each gift photo bag includes a pamphlet, dog treats, magnet, and a $5.00 off coupon here when spending $10.00 or more at a PETCO store. The most important aspect of the gift bag is the pamphlet, which offers a variety of informa- tion regarding owning a new pet. Some information in the pamphlet includes everything a consumer needs to know when owning a new pet from when they first get their new pet up to when they turn one-years- old. For example, the pamphlet will remind the consumer when their new pet should get the appropriate shots at the certain age, appropri- ate treats and toys, types of dog food and tell them when they should switch to something new, and examples of different types of collars that would fit their specific breed. These gift bags will give consumers a remembrance of PETCO, and entice them to stop by the store to let the PETCO expertise help them through the process of owning a new pet. Photo booth: The photo booths will be offered at every pet event that is pet friendly, so consumer s can make memories with their pets. Also, inside the gift bags are magnets that can appropriately fit the pictures that are taken from the photo booth. The magnets offer a new gift for the consumers and have last longing memories of their pet. On the magnet will be the PETCO logo, so consumers can also stop by the nearest PETCO store to learn more about taking care of a first time pet.66
  67. 67. Northwest Pet and Companion Fair:This event is in Portland, Oregon and has about a 7,000 attendance rate. It will take place on April 9th and10th of 2012. PETCO will not offer the gift bags, because this event makes up their own bags of different com-mercial sponsors. PETCO will put the pamphlet in this bag, which is the most important for the consumer tobe exposed to. At the PETCO booth it will have extra pamphlets, a bucket full of treats for the dogs, magnets,and coupons that consumers can take as they choose. A photo booth will be offered, because this event is petfriendly. This year the fair is offering a best dressed contest, so the photo booth will be very popular amongstthe consumers to take pictures of their pets in cute costumes.America’s Family Pet Expo:This event is in Los Angeles, California and has about a 35,000 attendance rate. It will take place on April 15th-17th of 2012. This is by far the biggest event chosen and offers many opportunities to expose consumers toPETCO. This expo has many different informational events throughout the three days to keep consumers in-terested to stay for a long period of time. The booth will offer the gift bags, but unfortunately will not offer thephoto booth since this expo is not pet friendly.Amazing Pet Expos:This event is offered in Houston, Texas, Austin, Texas, and South Florida, Florida. It will take place inHouston on April 16th, 2012, in Austin on October 8th, 2011, and in South Florida on March 31, 2012.These pet expos have about a 13,000 attendance rate. Similar to the America’s Family Pet Expo in LosAngeles, these pet expos offer many different informational events throughout the day. These expos arepet friendly and have a best costume contest, so therefore the photo booth will be very enticing to theconsumers to use.Chicagoland Family Pet Expo:This expo is in Chicago, Illinois and has about a 15,000 attendance rate. It will take place on March 18-20th in 2012. This is known as the biggest pet expo in the Midwest. The Chicagoland Family Pet Expois unfortunately not pet friendly, so a photo booth will not be provided. The gift bags will be offeredthroughout the day until they run out. 67
  68. 68. Chicago Pet Show: This expo is in Chicago, Illinois and has about a 2,000 attendance rate. It will take place on October 30th and 31st of 2011. Since this pet show is smaller, it benefits PETCO that they will be more noticed by the attendees throughout the day. This expo focus- es a lot on pet adoptions, therefore this works for the new PETCO campaign for the first time owning a pet. The gift bags will be provided, so new pet owners can learn about adoptions at other booths than see the vital information needed for owning a new pet. This pet show is not pet friendly, so the photo booth will not be offered. Haute Dog “Howl’oween” Parade: This parade will take place in Long Beach, Califor- nia and has an estimated attendance rate of 5,000 people. It will take place on October 30, 2011. Haute Dog is an organization that includes dog lov- ers, supporters, rescuers, etc. that support dogs and to make it a dog friendly community everywhere. This parade is the world’s largest Halloween event for dogs. It is a twelve block parade on 2nd street in downtown Long Beach, so PETCO will specifically place their booth towards the end of the parade. This is a fun and entertaining event for pet own- ers, and particularly new pet owners that wanted to dress up their pet for the first time. The booth will offer the gift bags and the photo booth, which should be very popular throughout the day.68
  69. 69. Paw Print Promo:One of the main objectives of the first times campaign is todrive consumers to PETCO over mass retailers . In orderto differentiate our store from the mass merchandisers wesuggest running a promotion that shows consumers thatPETCO understands the importance of pet care and ourpets. We will accomplish this through our campaign andpromotions. More specifically one promotion that will get thisaspect across is our Paw Print Promo.The Paw Print Promo will run in the beginning of ourcampaign. Pet owners will be invited to PETCO for a oneday event. On this day customers will dip their pet’s pawsin paint and stamp it onto archival paper, then sign and dateit. The paw print will then be hung in the store front so thatevery-time customers comes back to PETCO they will seetheir spot in the store and be reminded of how small there petonce was. This paw print will be a symbol of our partnershipand involvement in your puppies growth. Then in decemberthe prints will be sent out and transformed into a christmasornament. Not only will december be a half way mark inour campaign ,but this is a way to get PETCO back into thehomes of consumers when spending trends are up and familyis important. By encouraging consumers to track first timemoments, scrap book, and measure paws we hope that thiswill remind consumers of PETCOS dedication to a lifetimepartnership. 69
  70. 70. Google AdWords: The rationale for using Google AdWords is that Google, the search engine mogul, is the most used search engine taking up 49.2% of the market share for search engines (Sullivan, 2006). Google also has keywords to help optimize the consumer’s results as specific as possible giving PETCO the most accurate search results. Our target market is very tech-savvy; therefore we found it vital to have Internet-based advertisements. We will allocate $3,000 a day on a cost-per-click basis until the very end of our cam- paign, which will cost about $1,077,000. Facebook Advertising: Another logical approach to using Internet based ad- vertising is to turn to Facebook, the social network- ing expert. Facebook has more the 500 million ac- tive users and 50% of active users log on to Facebook in any given day (Pressroom, 2011). In 2009, 24% of our target market had an account and was an active user of Facebook (Smith, 2009). Our approach to using Facebook was to pinpoint our target market by specifically targeting people who live in pet friendly cities and have likes/interests related to pets. For our Internet campaign we suggest spending $1,000 a day until the end of our campaign. Facebook will only be charging us for cost-per-click.70