The document provides background information on PetSafe, a pet product company founded in 1991. It summarizes PetSafe's history of success with radio fences and acquisition of competitors. Data shows the pet industry and PetSafe's sales and profits growing steadily from 2009-2013. The document then covers PetSafe's product portfolio, pricing strategy, distribution channels, and promotion strategy focusing on customer satisfaction. It identifies areas for improvement such as refining product definition, reducing returns, strengthening quality oversight of overseas manufacturers, and increasing advertising.

1. Marketing Situation
Analysis Report
Zach Hupy

2. Background

3. History
• The PetSafe Brand was started in 1991
• Originally started selling radio fences to contain dogs, attempting to
compete with Invisible Fence Brand (at the time a different company)
• In 1991, Invisible Fence sold the transmitter portion of their system for
$450. The unit contained $13 worth of electrical components
• PetSafe wanted to offer a similar product for a better value than Invisible
Fence. In doing so, they eventually beat Invisible Fence in sales and bought
them

4. History Continued
• Financial goal for PetSafe was to sell 100 radio fences in
the first month. Actually sold 3,000 in the first month
• Sold $1,000,000 worth of radio fences in the first 6 months
• Founder Randy Boyd is still the CEO today
• Currently, Radio Systems Corporation (parent) is worth
upwards of $360M
• Radio Systems Mission Statement: “To be the most trusted
brand in the pet industry”

5. Radio System’s Distinct Brands

6. Industry Data
2009 2010 2011 2012 2013
Sales $ 14.09 B $ 14.67 B $ 15.29 B $ 15.87 B $ 16.28 B
Profits $ 2.76 B $ 2.55 B $ 2.84 B $ 2.97 B $ 2.96 B
0
2
4
6
8
10
12
14
16
18
2009 2010 2011 2012 2013
Pet Industry Profit and Sales (in billions)
Sales Profits

7. Brand Data
2012 2013
Sales $ 277.4 M $ 301.6 M
Profits $ 129.0 M $ 162.9 M
0
50
100
150
200
250
300
350
2012 2013
PetSafe Profit and Sales (in millions)
Sales Profits

8. Macro-environmental Factors
• ECMA (Electronic Collar Manufacturer’s Association) is a
world-standard in regulations on electrical outputs for collars
• ECMA restrictions on electrical power outputs for static
correction collars have been put in place to limit the stimulation
for the pet
• PetSafe has dedicated themselves to make sure that all their
products meet these ECMA standards, as well as adjusting their
products for international environments
• All PetSafe’s products also meet FCC regulations for radio
signals in the US as well as a number of regulations in each
country where they are used

9. Market Share
68.2%
21.4%
2.6%
7.8%
PERCENT MARKET SHARE (TRAINING COLLARS)
PetSafe Dogtra Tritronics Other

10. Product

11. Product Life Cycle
• The Pet Industry is in the mature age of its life cycle (According to IBIS Report for
March 2014)
• According to APPA, the tipping point of the industry happened in 2005-2006 when
pets began to be rewarded and punished in human terms.
• This tipping point sparked a boom that has created a significant increase in new pet
products and innovations leading up to 2014
• However, the forecast indicates that the number of new products released will
decline from 2014 until 2019
2004 2006 2008 2010 2012 2014 2016 2018 2020
Pet Product Life Cycle

12. Types of Products
• Currently, PetSafe has a wide variety of products, indicating a differentiated
target marketing strategy
• PetSafe currently produces remote dog training collars, radio control fences,
pet-proofing aids, kennels, water fountains, feeders, pet doors, litter boxes,
dog collars and harnesses, toys, treats, as well as several other types of
products

13. Product Strategy
• PetSafe’s marketing strategy uses superior innovation which positions them to offer
greater value to the consumer in several product categories
• Because of PetSafe’s dedication to new innovation (including over 40 patents) and
customer service, PetSafe has remained a leader in electronic pet production for
nearly 20 years
• Although PetSafe changed their slogan several years ago from “Happy Pets, Happy
Owners” to “Protect. Teach. Love.” , both slogans provide the same message to
consumers, who in turn have become loyal customers

14. Price

15. Price Range, Objective, and Strategy
• PetSafe is a higher-end product company that typically maintains a
constant price level for each of its segments
• PetSafe then employs product line filling to fully offer products to all
prospective buyers in the specific target market
• The price range of PetSafe’s products is between $3 and $600
• Training Collars range from $40-$200; Radio Fences range from
$160-$600; Dog Doors range from $13-$250
• PetSafe’s Price Objective: Offer a higher quality product, and the
product reliability and consistency will justify the higher price
• PetSafe’s Price Strategy: Although PetSafe prices are higher than some
competitors, those who experience the brand will become loyal
customers due to the product quality

16. Price Competition and Marketplace Environment
PetSafe PetSmart PetCo
Little Dog Elite Trainer $179.95 $164.99 $159.95
Stay + Play Wireless Fence $339.95 $300.99 $341.10
Electronic Passport Door $229.95 $199.99 N/A
DrinkWell Multi-Tier Fountain $59.99 $69.99 $42.99
• All the prices listed in the table above were online prices. Therefore, the online
market is extremely competitive with discounted pricing and changes in inventory
• The marketplace environment is also extremely competitive. On top of the well
known producers, there are also store-specific brands that attempt to duplicate the
products of the industry-leader, PetSafe

17. Place

18. Locations and Channel Structure Diagram
• PetSafe does not have retail or wholesale outlets. They do however have 7 offices world wide
and sell to more than 10,000 stores
• PetSafe employs multiple marketing channels. They use both P-C and P-R-C channel
structure and it is typically the retailer who is the channel captain
• This indicates that the channel structure uses an administered VMS
• PetSafe (and Radio Systems) use a third party distribution strategy to get their products
from the manufacturing line to the customer. They are typically warehoused in the US prior
to being shipped to customers.
• U.S. and World Headquarters: Knoxville, TN
Raw Materials:
Plastic, Circuit
Boards, Electronics
Product
Development
Product
Manufacturing
andAssembly
Marketing
Pet Product
Stores:
PetSmart
PetCo
Online and
Catalog Sales:
PetSafe.net
Customer Feedback

19. Promotion

20. Positioning Statement, Promotion Objective,
and Target Market
• Positioning Statement:To pet owners who want a quality product for their
loved one, PetSafe is a product company that gives simple and effective
solutions to their pets’ specific needs
• Positioning Objective: PetSafe’s objective is to use multiple mediums of
communication to capture several differentiated target markets to provide
the maximum amount of value to each segment
• The primary target market for the pet product industry are males and
females between the ages of 25 and 45 and are typically financially stable

21. Promotion Strategy and Tools Used
• Strategy focuses on customer satisfaction and customer service, fitting in
line with PetSafe’s Mission Statement, “To be the most trusted brand in the
pet industry”
• PetSafe promotes their brand by hosting an annual contest “Bark for Your
Park” in which cities in the US compete for a $100,000 grand prize to build a
dog park in their area

22. Positioning Map (Training Collars)
Low Quality
Low Price High Price
High Quality
Dogtra
Dog Widgets
PetSafe
Esky
AGPtek

23. What would you do differently?

24. Things I would adjust
• Product
• Product definition at times has been murky. A better defined product would make for a
smoother new product development process. This can be achieved through a customer-based
marketing strategy. By performing studies PRIOR to product creation and getting
consumer feedback, marketers can better inform engineers of the product requirements
• Product returns being close to 5% company-wide is simply too high. Consider hiring an
additional quality control employee to work along the assembly line full-time. Also consider
creating quality requirements for the manufacturers to make product. If the manufacturers
do not meet PetSafe’s standards, they do not make PetSafe products
• Place
• PetSafe products are currently sold in many retailers, both in stores and online. However, all
of their manufacturers are in China, with a Chinese-lead design team. I think the CDC
needs a full time American-trained overseer to ensure products stay on schedule for delivery

25. Things I would adjust
• Price
• Having worked at Radio Systems, I feel qualified to say they work from a cost-based
pricing mentality. Switching to a more value-based pricing mentality would be better
for the company in the long run to create a loyal customer base
• Promotion
• Historically, PetSafe has not done much advertising. They are beginning to include
advertising in their marketing mix, but they still need to make a more concentrated
effort to advertise in high-touchpoint media. Possible media include television,
promotional events at pet stores, and even discounting on their online marketplace