Embrace Pet Insurance Blog

Pet-related Small Business Trends 2009

It's official! Anita Campbell, has posted the detailed Pet Industry Trends for 2009 that I write every year over on her Small Business Trends blog. It's from a small business perspective, a topic dear to my  heart.

In the meantime, here is a summary for you, just in case you didn't have time for the full version.
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Pet-related Small Business Trends 2009

Question: is the pet industry recession-proof as many say it is? Answer: 2009 will prove out whether or not pet owners spend on their pets through thick and thin.

The overwhelming pet-related trend in 2009 will be value for money – spending more thoughtfully and spending less. 2009 spending will level off as pet owners pay more attention to their budgets. The top ten trends are:

1. Pet parents will spend, but more thoughtfully than in recent years

Spending on pet supplies and over-the-counter medicines was projected to increase 5.1% in 2008 from $9.8 billion to $10.3 billion according to the American Pet Products Association (APPA) but before the recession announcement. We would not be surprised to see more modest increases in the range of 2% in 2008, continuing on to 2009.

2. Pet services for pets continue to grow

There’s a reason Wal-Mart is testing grooming in its stores and expanding its pet aisle – pet parents are spending good money in this area, even in a recession. More than $3 billion dollars will be spent on pet services in 2008 according to the APPA, which will likely continue to grow in 2009, but at a lower rate than in prior years.

3. Dog’s Star on the Rise for 2009?

The number of cats in the US have long dominated dog numbers (according to the American Veterinary Medical Association, there are more than 72 million pet dogs in the U.S. but nearly 82 million pet cats). Will the new First Dog inspire people with dog allergies to reconsider bringing a dog in-house?

4. Growing interest in pet health care

Pet parents are taking control of their pets’ health care as they do their two legged children. Technology from the human world continues to make its way into the veterinary tool kit including non-invasive surgeries, human medical devices and services being applied to pets. Pet lovers want, and are demanding, the same treatment options for their pets as they can get for themselves.

5. Pet insurance edges towards the mainstream

We estimate the size of the US pet insurance market to be $271 million in premium in 2008, up from approximately $220 million in 2007 (a 23% increase) and we expect 2009 premium to reach $328 million. We project that the market will grow to $500 million by 2012.

6. Hybrids take center stage

Not just popular for cars, recent years saw the popularity of hybrid dogs grow rapidly. As predicted last year, 2008 saw the growth of the puppy farm hybrid to take advantage of the inflated prices people are paying for these dogs. 2009 is only going to get worse in this respect.

7. Increased competition from larger players.

Larger companies are beginning to recognize the economic potential of the pet industry. Target and Wal-Mart are both expanding their pet selection and using pets in their advertising.

8. Large companies hold off buying smaller just when the prices are right.

Some might say that right now is the perfect time for consolidation in the pet industry because of the incredibly low valuations but don’t expect much to happen in the first half of 2009.   

9. Increased online sophistication from new pet-related businesses in ecommerce, design, and usability.

In 2008, a whole slew of new “WebMD for pets” websites appeared, such as WebVet, PetMD, and PetDoc, and we’ll see them battle it out for the lead position in 2009. Newer players are more sophisticated in design and ecommerce, reaching their target audience via web-site usability, search engine optimization, paid search, and word of mouth marketing.

10. Pet-related blogs continue to grow their influence.

The power of pet-related blogs really showed up during the pet food recall in the middle of 2007. Blogs such as Pet Connection, Pet Sit USA and Dolittler continue to provide high quality commentary on all aspects of pet news and issues.

And one final bonus trend that indicates the direction of pet health …

11. The divergence of the veterinary clinic

On the one hand, the advent of advanced human medical tests and treatments in the pet world has led to the growth in private specialty clinics. At the other end of the spectrum, there is good money to be made by a single veterinarian in a practice focusing on pet wellness, without the need for fancy equipment and more than a handful of support staff. We predict this divergence between wellness and accident/illness care in veterinary clinics will grow noticeably over the next five years.
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So there you have it - what do you think the pet trends of 2009, 2010 and beyond will be?

Sneak peak at the 2009 Pet Trends

I have to keep this short (big day tomorrow) but if you are interested in a sneak peak at the 2009 pet trends coming up, here's a story on some off-the-top-of-my-head comments to journalist Darcy Lockman made on the subject a month ago in her article A Dog-Centric Look Back at 2009.

The biggest trend Darcy thought for 2009?

But what is Bennett's biggest prediction for 2009? She thinks the popularity of adopting a shelter dog will skyrocket. "Shelters and rescues will be the big thing after the Obamas move into the White House. Everyone will want to say, 'I got my dog from the same place the president got his.'"

What do you think?

Celebrating the top posts for the Embrace Pet Insurance blog

Hard to believe but it was 3 years ago today that I wrote the first pet insurance blog entry. Time flies, as they say, but boy, has a lot ever happened in that time.

So, in honor of our big day, I thought I'd share the top viewed posts from the blog:

1. Saddle Thrombus in Cats - a description of this awful and mostly terminal condition. This blog post also has the most comments, most of which are heart rending. Get out the Kleenex's when reading this one.
2. My Dog or Cat is Limping - what could that limp be? Post describes a number of different scenarios.
3. Dog or Cat Protective Head Cone - could it be those great pictures on this post? What a strange one to be in the top 6
4. Toe Amputations for Cats and Dogs - an odd but strangely interesting post on loosing a toe to illness or accident
5. Perineal Urethrostomy: Description and Costs - an altogether ouchy topic for male cats but costly too
6. Repairing a Tracheal Collapse in Dogs - another costly procedure for smaller dogs

Wonder what the next year's top posts will be - any suggestions for topics you'd like me to cover?

PS. That's Ruby, Jonathan's new dog, who came to visit the office this morning. Nice to have our puppy therapy so early in the week.

Pet Travel is increasing - what do you think?

Here's the last "bonus" item in my Pet Industry Trends for 2008 article.

More people traveling with their pets
From day trips with the dogs in the back of the car, to trips abroad with your pets, more and more people are including their cats and dogs in their travels. As a result, more hotels, such as the Comfort Inn all the way up to the Westin are accommodating pets beyond just allowing them on the premises. This gives small businesses the opportunity to provide services to local hotels for pets or for accessories to make traveling even easier.

Recently someone asked me about my pet travel assertion and how I determined this trend.

In answer to that questions, there’s no magic stat that I’ve seen; I use the mosaiic theory - put a number of other stats and observations together and draw a conclusion.

• From Michael Dillon’s report Pet Industry 2007 Strategic Report, he comments on the baby boomers retiring and their pet spending:

55-64 year-olds represent a very compelling demographic due to 4% projected growth through 2010, according to the Census Bureau. 55-64 year-olds are the fastest-growing age demographic in the pet industry, spending $7.75 billion in 2005, up 127% from 2000. With the active boomer generation set to spend more time with their pets, whether at home or on the road, we expect to see more travel products for pets over the next two years.

• Boomers travel more than most (trends from the TIA Domestic Travel Market Report)
• Proliferation of pet friendly hotels (intercontinental, Crowne Plaza, Wyndham Hotel, Ritz Carlton, Radisson, Marriott, Holiday Inn, Days Inn, Comfort Inn, Red Roof Inn, La Quinta, etc.)
• Appearance of numerous specialty travel services either for pets or involving pets (Bailey Knows Travel, Pets Welcome, Puppy Travel )

And so on…

What signs are you seeing to support my assertion or not?

Funny searches that reach my blog

I always marvel at how people get to my blog - check these out:

1. plastic surgery procedures gone deadly wrong (in google images - ew!)- wow, that made my heart quicken until I clicked on it and discovered a cute picture of Lily my cat - very bizarre!
2. why would a cat sneeze - probably the same reason the chicken crossed the road
3. pet insurance stocks - can't wait for us to go public :)
4. fun facts about an actuary - see, someone thinks actuaries are fun!
5. my mom told me to type in vet insurance - quite right too
6. why is it illegal to spay your pet in norway - I did not know that
7. who bought a stake in southampton f c - not me
8. koi pet insurance - I think we'll stick with cats and dogs for now
9. hamster fun facts - what's not fun about a hamster?
   
   and the most surprising of all...
10. hottub black girls (also google images) - likely the searcher would be very disappointed to find the cutest picture of Calvin the Labrador Retriever in the hot tub!

Ah, Friday fun!!! Gotta love it.

Pet-related Small Business Trends - updated for 2008

Every year, I write an article on pet-related small business trends for Anita Campbell over at the Small Business Trends blog. Here's the 2008 Pet-Related Small Business trends article.

Turns out my article is Anita's most popular in the trend category. It just goes to show that there are a lot of people interested in the future of pet-related businesses. I'm sure Anita had no idea this would be the case when she asked me to write my first article over 2 years ago.

In case you missed them the previous two years, here are the links for the all the articles.

Pet Industry Trends in 2008
Pet Industry Trends in 2007
Pet Industry Trends in 2006

Are there an pet-related business trends you've noticed lately?

Actuarial Pioneer: Laura Bennett, pet insurance actuary

The Society of Actuaries (SOA) has been building a list of the top 100 actuarial "Pioneers" as part of building the awareness of the actuarial field. To be on it, you have to be "an actuary who has blazed a trail for actuaries by creating a new application for actuarial science, or one who is among the first to apply the actuarial skill set in a non-traditional setting."

I think that pet insurance certainly qualifies in that category, don't you? And nicely enough, so does the SOA. Cool!

So, I did an actuarial Pioneer interview with the SOA a few months ago (it just went online) about the impact that being an actuary has had on my career, among other things. It's a bit of a fun mish-mash of tidbits about Embrace and me. Maybe it will inspire some aspiring actuaries to spread their wings, who knows?

I really liked the quote they selected out to highlight the whole article: " ... the smallest kindness in business goes an incredibly long way and it more often than not brings you benefits you could never have planned for." I really believe that - do you?

BTW, the picture above is not the picture I gave them for the article (this one was taken afterwards for a friend of Embrace) but I would really have loved to have used it instead of the goofy "corporate" one I sent instead. Oh well. Must get my "official" photos reshot!

How Embrace got its name

I tell this story a lot when I'm talking about Embrace and thought you'd like to hear it too...

It was July 2003 and Alex and I had just founded our new pet insurance company out of the pet insurance team that won the Wharton Business Plan Competition in April 2003. We sat around some coffee in the Au Bon Pain cafe at Wharton and we brainstormed all sorts of what we thought were clever and original names:

• Savannah Pet Insurance (hmmm, images of mint juleps and muggy nights on the front porch)
• Magenta Pet Insurance (female oriented - not quite pink but nearly)
• Casanova Pet Insurance (don't ask - the coffee must have been spiked)
• Merrylegs Pet Insurance (a Dicken's character's dog)
• Marigold Pet Insurance (a lovely flower and we all love flowers)

And then we set up a survey in Surveymonkey and passed it on to all the pet parents we knew and asked them to forward to their friends.

Well, as you might imagine, the results were not too stellar. I think the highest score was no more than 2.5 out of 5 - not very encouraging at all. But the message from the write-in comments was that we reflect the emotional bond between pet parent and pet. Alex and I looked at each other and Alex said, I dunno, how about Embrace? and I helpfully added "Angel", both of which we grimaced at - how touchy feely they were!

So we resurveyed with Embrace Pet Insurance and Angel Pet Insurance and wouldn't you know it, Embrace blew away the competition. I think the average was something in the high 4's - it was unanimous, Embrace Pet Insurance was our new name.

I have to admit, I was a bit dismayed and should I say a little bit embarrassed to tell people what the new name was for the first couple of days but I got back such a powerfully positive response, it didn't take long for me to love the name and realize how well it works.

From the dictionary:

embrace em·brace [ em bráyss ]

verb (past and past participle em·braced, present participle em·brac·ing, 3rd person present singular em·brac·es)
Definition:

1. transitive and intransitive verb hug somebody: to hug somebody in your arms affectionately or passionately, or hug each other affectionately or passionately
2. transitive verb make use of something: to welcome and take advantage of something eagerly or willingly embrace an opportunity
3. transitive verb adopt something: to adopt or take up something, especially a belief or way of life embraced free-market economics
4. transitive verb comprise something: to include something as part of a whole a new electoral district embracing both suburban and urban areas
5. transitive verb surround something: to surround or enclose something ( literary ) ( often passive )

noun (plural em·brac·es)

Definition: warm hug: an affectionate or passionate hug [14th century. < Old French embracer "take into your arms" < Latin bracchium "arm"]

em·brace·able adjective
em·brace·ment noun
em·brac·er noun

It's perfect in all ways don't you think?

So the lesson we learned is to ask our customers their advice when it comes to big decisions. We've been steered right so far.

FluffyQuits.com - why you should quit smoking

We all know that second hand smoke hurts the people in the house but did you think about your pets too?

A consortium of veterinary organizations and stop-smoking organizations in the Niagara NY region have banded together to promote Fluffy Quits, which is a program to "educate smokers about the dangers and ramifications associated with smoking around household pets."

I spotted the program on a bill board on the I90 as I drove back and forth from Cleveland to Ontario recently and just love the grassroots activism to promote this little known benefit of quitting smoking.

The website has information of the impact of smoking on pets and encourages pet parents who have recently given up smoking to post pictures of their pets in their Hall of Fame. You can get 5 FluffyBucks certificate to your next visit to the vet and a very strange looking "Smoke Free and So Freakin' Happy" FluffyQuits.com T-shirt for free. Just make the pledge and add your pet to the Hall of Fame (only for NY residents, sorry)

Here are some of the facts on the site:

Q: Is Second Hand Smoke really a big deal in my home?
A: Studies show that the amount of air pollution is on average 8 times higher in homes where smoking is permitted.

Q: What could my pet experience from exposure to Second Hand Smoke?
A: Pets can develop respiratory infections, lung inflammation or asthma when breathing in Second Hand Smoke.

Q: What else should I know about keeping my pet safe from tobacco products?
A: Tobacco, cigarette butts, nicotine replacement products such as patches and gum, chew and other tobacco products are attractive to pets. If eaten, these items could be also be toxic to your pet. Tobacco products should be kept out of reach of pets and disposed of properly.

Update: sadly the website seems to be defunct for now. I'll let you know if it comes back up again :(

Embrace Pet Insurance on Startup Studio

Last September, a Wharton friend of mine put me in touch with Betsy Flanagan, a talented entrepreneur with an interesting business idea involving podcasts and entrepreneurs. Betsy interviews a variety of entrepreneurs and she posts a weekly podcast from the interview on her website Startup Studio.

You should see some of the people on her site - George Foreman (yes, THE lean, mean grilling machine), Tazo Tea founder Steve Smith, and Herb Kelleher, founder of Southwest (ding - you are free to move about the country) - to name a few.

So check out this week's podcast - it's me chit chatting about Embrace Pet Insurance, what it's taken to get to where we are now, and the emotional side of entrepreneurship. And you get to hear my English accent. Yes, it also sounds strange to me too.

In the US, more money is spent each year on cats and dogs than on babies. My guest is Laura Bennett, the co-founder of Embrace Pet Insurance, a company that is partnering with Lloyds of London to offer health insurance for pets. The market is enormous. In the US alone, there are 73 million dogs and 90 million cats and projected annual growth of insurance premiums is 45%. Embrace Pet Insurance was launched in 2003 after Laura and her partner won the annual Wharton Business Plan Competition, beating out dozens of Internet and technology ventures. Despite this strong start, it took over three years before the company could sell their first policy. Tune in to hear how Laura persevered and made her dream a reality.

[I'll put a permanent link to the article when there is one]