Located 25km east of Apollo Bay is Kennett River, a tiny, relaxed coastal community comprising not much other than a caravan park, a kiosk and holiday homes. As well as its fantastic beach, it's known for its great koala spotting just behind the caravan park. There are also glow-worms (larvae from fungus gnats, to be precise) that shine at night up the same stretch of Grey River Rd; take a torch, but it's imperative not to shine it on the glow-worms themselves.
Unfortunately, the town has suffered from the many tour buses that descend to see the koalas and feed the birds (crimson rosellas, cockatoos and king parrots) and has become a bit of a circus. Heed the signs, and do not feed the birds, especially as it will likely make them sick.