How One Energy Extractor Engages With Niche Markets

7/25/2018
Zach Brooke
Key Takeaways

What? An energy company needed to market two distinct products simultaneously.

So what? It leveraged price in local markets and reliability in extended markets.

Now what? Research your target markets to uncover perceptions and opportunities for differentiation.​​​​​

Kinetrex Energy enlisted the help of an agency to execute dual campaigns for two distinct properties

Goal

Good marketing is often simple. Many companies strive to reduce their essential business to a confident tagline, a Trojan horse carrying powerful emotional hooks. So it was no small task when Kinetrex Energy enlisted Dallas-area agency MCC to boost its profile as a provider of two technically complex products.

Kinetrex wanted increased awareness of its overall brand, but to get there, it needed separate campaigns for two distinct energy lines. Natural gas energy, acquired by the company at the wellhead and piped to customers’ tanks and hookups, was one. The campaign was to be limited to the small radius around Kinetrex’s Indianapolis headquarters, where the company could offer the prices needed to compete with rival suppliers. 

The second product reached further and was more futuristic: liquified natural gas (LNG), or natural gas that has cooled to minus 260 degrees and condensed into a liquid state. Unlike surface temperature natural gas, which requires a pipeline for transportation, LNG can be moved in tanker trucks. It can also power the trucks themselves, as well as many other automobiles. (UPS, for instance, uses LNG in all of its Class A vehicles). Given that LNG is more free-moving than its gaseous alternative and is cheaper and better for the environment, it should be poised to compete nationwide with alternative energy sources, such as propane and diesel, if marketed correctly.

Promoting one fuel or the other was easy. Doing both at the same time was not so simple. “[We needed to] generate brand awareness with two product focuses with such a significant difference in who we’re researching, how we’re reaching them and what they need to know about Kinetrex Energy,” says MCC senior account executive Christina Phillips.

Oh, and marketing needed to be built from scratch.

“Until recently, we had no internal marketing people whatsoever,” says Mark Gallo, director of sales and marketing at Kinetrex. “MCC provides broad offerings and an all-inclusive ability to create digital marketing, video, radio ads and websites.”

Action

MCC kicked off its plan to elevate the Kinetrex name with market research, starting with surveys of Kinetrex insiders on how they thought Kinetrex was perceived by outsiders. It continued with subsequent surveys of the public to gauge what they actually thought about Kinetrex, if they thought of it at all. Armed with the competing data sets, researchers measured the opinions against one another to locate gaps in understanding Kinetrex’s brand.Audience priorities were sussed out and highlighted alongside the perception gaps. Unsurprisingly, top prospects cared most about the price of the energy they used. This boded well for Kinetrex’s prospects in the transportation space, since LNG is about a dollar cheaper per gallon than diesel fuel. But when reliability also emerged as a main point of importance, the team knew they found something they could use to push LNG as a differentiator, particularly within the agricultural sector. Farmers accustomed to propane-powered farms are often hit with unpredictable price fluctuations and periods of scarcity —two pain points that don’t come with LNG. The ability to heat a farm is critical for livestock producers, Phillips says. If the animals can’t survive the cold, farmers lose their income.


The findings became the thematic anchor of a new digital campaign. MCC created banner ads that showed the Kinetrex logo beneath a snowy barnyard, with overlaid text flashing, “Kick the propane habit. Learn about the better option.”

That call to action brought users to a webpage with more information on Kinetrex LNG. “We can’t tell everyone everything about LNG in a small animated GIF, so our goal was to throw down propane as the volatile option and help them learn about the other options by linking to a full webpage users could investigate,” Phillips says.

Though banner personalization was low, owing to cost-conscious efforts, Phillips says MCC customized content somewhat for poultry, hog and grain prospects by using different visual imagery and marketing copy. More importantly, they employed geo-sensing in their digital ad placement, which allowed them to target the headquarters of the highest-value prospects.

For the traditional natural gas product line, MCC crafted a multi-platform campaign that centered on Kinetrex’s connections to the Indianapolis market. Since Kinetrex didn’t plan to compete outside of a limited footprint around its headquarters, MCC played up the local connection, highlighting Kinetrex’s roots in the community and positioning it as a local business. But instead of placing competitors on blast with the LNG banner ads, ads for locally supplied natural gas instead showed the Kinetrex logo rising above the Indianapolis skyline before wiping away to text reading, “Time to save on natural gas. Kinetrex Energy, the local gas supplier for local businesses.” 

The digital ads were complemented by spots on local radio, as part of a concerted effort to build name recognition. 

Prospects feel more comfortable speaking with salespeople when they’ve heard of the business before, Gallo says.

Results

The dual campaigns performed admirably. Digital response for the localized traditional pipeline-delivered natural gas earned 6.7 million impressions, with an average engagement rate of 51.6% among Indianapolis’ population of 860,000. The LNG campaign, pitched to a more niche audience, generated nearly 2.4 million impressions and 94.4% engagement rate. Combined, the two campaigns averaged a click-through rate of 0.17% percent, or nearly twice the B-to-B average of 0.09%. The number of active prospects shot up by 700%.

MCC’s work was recognized by the Dallas-Fort Worth chapter of the AMA, which named the agency its Marketer of the Year in the energy category. More importantly, the increased awareness helped usher in a windfall at Kinetrex. Since partnering with MCC, Gallo says Kinetrex has seen its revenue grow by 60% and its employee count grow by 75%. 

The company is racing to open a third gas-producing plant at the beginning of next year. Kinetrex CEO Aaron Johnson told the Indianapolis Business Journal he expects volume production to grow by 40% in 2018 before the new plant becomes operational. While much of the expansion is the result of Kinetrex being acquired by a Chicago hedge fund, Gallo believes the investment opportunities are due in part to how well Kinetrex marketing has performed.


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ABOUT THE AUTHOR:
Zach Brooke
Zach Brooke is a former AMA staff writer turned freelance journalist. His work has been featured in Chicago Magazine, Milwaukee Magazine, AV Club and VICE, among others. Follow him on Twitter @Zach_Brooke.

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