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Price Comparison Sites in General Insurance - UK - July 2015

“Price comparison websites have cemented their role in the way that people buy financial products, particularly within the insurance sector. Market leaders are spending generously in order to stand-out from their rivals. Within such a competitive market environment building trust should not be overlooked in favour of creating a memorable image, as trust will be a longer-term determining future success. This, and rewarding loyalty, which market leader Comparethemarket has successfully made strides toward with its ‘Meerkat Movies’ promotion, will set the tone for the market over the next few years.”
– Sean Song, Financial Services Research Analyst

This report looks at the following areas:

  • Consumer loyalty is low and offering additional perks is a must as competition intensifies
  • Building consumer trust is just as important as building a brand image

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Table of contents

  1. Executive Summary

      • The market
        • Insurance is still the key product for comparison sites
          • Figure 1: First information sources used to research financial products before purchase, March 2015
        • Car and home insurance are the most widely researched and bought products on PCWs
          • Figure 2: Insurance products researched/purchased through price comparison sites, May 2015
        • Market factors
          • Regulatory involvement
            • Online trends
              • Nearly a quarter of tablet owners have accessed a PCW from their device
                • Figure 3: Other online activities on device, April 2015
              • Companies, brands and innovations
                • Comparethemarket leads a competitive market landscape
                  • Figure 4: Price comparison site market share, 2015
                • The majority of consumers use 3+ PCWs to research and or purchase insurance products
                  • Figure 5: Repertoire of website usage, May 2015
                • Brand analysis
                  • Figure 6: Attitudes, by brand, May 2015
                • Marketing efforts reach new levels with record £120+ million advertising spend in 2014/15
                  • Figure 7: Recorded above-the-line, direct mail and online display advertising expenditure in the price comparison websites market, 2010-15
                • The consumer
                  • Three key consumer segments: The Purchasers, Just Checking, and Non-users
                    • Figure 8: PCW usage consumer segments, May 2015
                  • Purchasers: The majority purchase two or more insurance products
                    • Figure 9: Number of products bought, May 2015
                  • 45% of the ‘solo purchasers’ buy car insurance via a PCW
                    • Figure 10: Number of products bought, by insurance product breakdown, May 2015
                  • The mainstream products boast superior conversion rates
                    • Figure 11: Conversion ratio, by product, March 2015
                  • Just Checking group: Over half go on to check out the providers’ websites for a better deal
                    • Figure 12: Reasons for not purchasing, May 2015
                  • Laptop and desktop usage ahead, but tablets are up-and-coming
                    • Figure 13: Device usage for accessing PCWs, May 2015
                  • Transparency still needs to be improved
                    • Figure 14: Attitudes toward transparency and coverage, May 2015
                • Issues and Insights

                  • Consumer loyalty is low and offering additional perks is a must as competition intensifies
                    • The facts
                      • The implications
                        • Building consumer trust is just as important as building a brand image
                          • The facts
                            • The implications
                            • The Market – What You Need To Know

                              • PCWs are most used for insurance products, while credit cards & savings accounts are up-and-coming
                                • The FCA outlines its expectations for the future
                                  • 23% of tablet owners have accessed a PCW on their device
                                  • Market Developments

                                    • PCWs are well-ahead within the insurance market compared with other financial products
                                      • There’s room to grow in the brand-led mortgage and current account markets
                                        • Figure 15: First information sources used to research financial products before purchase, March 2015
                                    • Market Regulation

                                      • FCA’s thematic review gives price comparison websites points for improvement
                                        • FCA outlines further room for improvement
                                          • CMA’s ban on agreements between PCWs and insurers will place further downward pressure on prices
                                          • Online Trends

                                            • Smartphone and tablet ownership on the rise
                                              • Figure 16: Household ownership of computers, tablets and smartphones, January 2012 – November 2014
                                            • Managing finances online takes a top 3 spot in online activities
                                              • Figure 17: Other online activities, April 2015
                                            • Nearly 1 in 4 tablet owners have accessed a PCW from their device
                                              • Figure 18: Other online activities on device, April 2015
                                          • Key Players – What You Need To Know

                                            • Comparethemarket leads a competitive market landscape
                                              • Gocompare, Moneysupermarket and Confused display similar consumer usage rates
                                                • Google’s comparison service visited by 14% of consumers
                                                  • Comparethemarket.com leads the way in brand trust and differentiation
                                                  • Market Share

                                                    • Comparethemarket leads the pack in a competitive market environment
                                                      • Figure 19: Market share, 2015
                                                    • Loyalty remains a problem for comparison sites
                                                      • The looming threat of Google’s comparison service
                                                      • Competitive Strategies

                                                        • Comparethemarket.com
                                                          • Comparethemarket partners Cinema First to offer customers 2-for-1 cinema tickets
                                                            • Comparethemarket takes to Facebook to use video ads
                                                              • GoCompare.com
                                                                • Insurance company, Esure, buys majority share in Gocompare
                                                                  • Gocompare increases TV-spending by sponsoring game show
                                                                    • Moneysupermarket.com
                                                                      • TV advert featuring ‘Dave’ contributes to a 5% increase in advertising spend
                                                                        • Confused.com
                                                                          • Confused.com partners with Motors.co.uk
                                                                            • Confused.com introduces new characters alongside BRIAN
                                                                              • Innovations
                                                                                • TalktoTim.co.uk innovates the Travel Insurance comparison sector
                                                                                • Brand Perceptions and Social Media

                                                                                  • What you need to know
                                                                                    • Brand map
                                                                                      • Figure 20: Attitudes towards and usage of selected brands, May 2015
                                                                                    • Key brand metrics
                                                                                      • Figure 21: Key metrics for selected brands, May 2015
                                                                                    • Brand attitudes: Comparethemarket.com’s promotional activity boosts loyalty associations
                                                                                      • Figure 22: Attitudes, by brand, May 2015
                                                                                    • Brand personality: uSwitch.com struggles to create upbeat image in the face of strong advertisers
                                                                                      • Figure 23: Brand personality – macro image, May 2015
                                                                                    • Money.co.uk’s distant position suggests it lacks the common associations of the market
                                                                                      • Figure 24: Brand personality – micro image, May 2015
                                                                                    • Brand analysis
                                                                                      • Moneysupermarket.com appears to be in a strong position
                                                                                        • Figure 25: User profile of Moneysupermarket.com, May 2015
                                                                                      • Comparethemarket.com’s marketing strategies have provided an advantage over others
                                                                                        • Figure 26: User profile of Comparethemarket.com, May 2015
                                                                                      • uSwitch.com struggles to create an upbeat image
                                                                                        • Figure 27: User profile of uSwitch.com, May 2015
                                                                                      • Confused.com looking to use BRIAN promotion to strengthen positive attributes
                                                                                        • Figure 28: User profile of Confused.com, May 2015
                                                                                      • Gocompare.com may have benefitted from shift in advertising strategy
                                                                                        • Figure 29: User profile of Gocompare.com, May 2015
                                                                                      • Money.co.uk lacks awareness of other brands but needs to improve performance to current users too
                                                                                        • Figure 30: User profile of Money.co.uk, May 2015
                                                                                    • Brand Advertising

                                                                                      • Advertising spend hits record levels of over £120 million as companies push marketing efforts
                                                                                        • Figure 31: Overview of above-the-line, direct mail and online display advertising expenditure in the price comparison websites market, 2010-15
                                                                                      • ‘Big Four’ price comparison websites dominate advertising spend
                                                                                        • Comparethemarket.com ramps up advertising spend
                                                                                          • Figure 32: Above-the-line, direct mail and online display advertising expenditure by selected financial aggregators, 2011/12-2013/14
                                                                                        • TV advertising rules, while radio spend comes in second
                                                                                          • Figure 33: Above-the-line, direct mail and online display advertising spend by brand and media type, 2014-15
                                                                                        • Nielsen Media Research advertising coverage
                                                                                        • The Consumer – What You Need To Know

                                                                                          • Over 2 in 3 consumers have used a PCW to research insurance products
                                                                                            • 47% of consumers have used a PCW to purchase an insurance product
                                                                                              • Three key consumer segments: The Purchasers, Just Checking, and Non-users
                                                                                                • Most consumers don’t restrict themselves to just one PCW when researching or buying
                                                                                                  • Laptop and desktop usage ahead, but tablets are up-and-coming
                                                                                                    • Market coverage is a concern for 63% of consumers
                                                                                                      • Only 16% are willing to pay a fee for a service which offers more detail
                                                                                                      • Insurance Product Research and Purchasing

                                                                                                        • The majority of consumers have used PCWs to research insurance products within the last year
                                                                                                          • Figure 34: Insurance product breakdown, March 2015
                                                                                                        • 32% of consumers have purchased car insurance via a PCW
                                                                                                          • The mainstream products boast superior conversion rates
                                                                                                            • Figure 35: Conversion ratio, by product, March 2015
                                                                                                        • Key Consumer Segments

                                                                                                          • A 50/50 split between purchasers and non-purchasers
                                                                                                            • Figure 36: PCW usage consumer segments, May 2015
                                                                                                          • The purchasers
                                                                                                            • Most of the Purchasers have arranged multiple policies
                                                                                                                • Figure 37: Number of products bought, May 2015
                                                                                                              • A fifth of buyers use PCWs to purchase just a single insurance product
                                                                                                                  • Figure 38: Number of products bought, by insurance product breakdown, May 2015
                                                                                                              • Reasons for Not Purchasing Through Comparison Sites

                                                                                                                  • Just Checking group: Over half go on to check out the providers’ websites for a better deal…
                                                                                                                    • …while a quarter were looking for more product detail
                                                                                                                      • Figure 39: Reasons for not purchasing, May 2015
                                                                                                                  • Price Comparison Site Usage

                                                                                                                    • Comparethemarket.com leads a competitive market landscape
                                                                                                                      • Figure 40: Price comparison site usage, May 2015
                                                                                                                    • The majority of consumers use multiple PCWs
                                                                                                                      • Figure 41: Repertoire of price comparison site usage, May 2015
                                                                                                                    • 1 in 4 consumers sticks to just one comparison site
                                                                                                                      • Figure 42: Repertoire of website usage, by website usage, May 2015
                                                                                                                    • Gocompare.com edges ahead of Moneysupermarket.com in terms of popularity among Purchasers
                                                                                                                      • Figure 43: Just checking group, by website usage, May 2015
                                                                                                                      • Figure 44: Purchasers, by website usage, May 2015
                                                                                                                  • Device Usage

                                                                                                                    • Laptops and desktops are the most favoured devices for checking PCWs
                                                                                                                      • Figure 45: Device usage for accessing price comparison sites, May 2015
                                                                                                                      • Figure 46: Household ownership of computers, tablets and smartphones, January 2012 – November 2014
                                                                                                                  • Concerns over Coverage and Product Details

                                                                                                                    • Complete market coverage is a concern for the majority of consumers
                                                                                                                      • Figure 47: Concerns over coverage and product details, May 2015
                                                                                                                    • Wariness of prices is an issue for many consumers
                                                                                                                      • A sizeable minority believe product detail is insufficient
                                                                                                                      • Concerns over Convenience and Usability

                                                                                                                        • 50% of purchasers believe PCWs do not reward loyalty
                                                                                                                          • Simplicity is key for the consumers who feel overwhelmed by PCWs
                                                                                                                            • Figure 48: Concerns over convenience and usability, May 2015
                                                                                                                          • Having too many options can be almost as bad as having too few
                                                                                                                          • Privacy Concerns

                                                                                                                            • Data privacy is a concern for a significant number of consumers
                                                                                                                              • Figure 49: Attitudes toward PCWs, May 2015
                                                                                                                          • Attitudes towards Transparency and Coverage

                                                                                                                            • Service transparency should be a focus
                                                                                                                              • Figure 50: Attitudes toward transparency and coverage, May 2015
                                                                                                                            • Power purchasers are more likely to be willing to pay a fee for a comparison service
                                                                                                                              • Figure 51: Attitudes toward transparency and coverage, by Repertoire of purchasers, May 2015
                                                                                                                          • Interest in Product Development

                                                                                                                            • Rewarding loyalty can win over the majority of consumers
                                                                                                                              • Over 1 in 3 consumers would be interested in a price comparison app for their smartphone or tablet
                                                                                                                                • Figure 52: Interest in PCW product development, May 2015
                                                                                                                              • Power purchasers are more open to the idea of service enhancements
                                                                                                                                • Consumers want better PCW engagement, but on their terms
                                                                                                                                  • Figure 53: Attitudes toward PCWs, by Repertoire of product purchase, May 2015

                                                                                                                              Companies Covered

                                                                                                                              To learn more about the companies covered in this report please contact us.

                                                                                                                              Price Comparison Sites in General Insurance - UK - July 2015

                                                                                                                              £1,995.00 (Excl.Tax)