Loyalty is dead and buried. British customers are switching banks, energy suppliers, broadband, TV and insurance providers, more and more often – and the main driving factor is price.
These super-savvy consumers are ruthless, and they’ll stop at nothing to save a few pounds, which is why price comparison websites like moneysupermarket.com and comparethemarket.com have become so popular. Seriously, can you even turn on the telly without seeing a meerkat speak in a stereotypical Russian accent?
As a product or service provider, you probably want to keep customers happy. And to keep customers, period. So how are price comparison websites affecting the way you should do business?
How do UK consumers use price comparison sites?
Comparison websites tend to be reserved for products and services like broadband and TV or phone contracts, flights and hotels, or insurance and energy – in 2013, 81% of consumers who used price comparison sites were searching for car insurance, while 50% searched for home insurance and 44% for energy.
The figures are only going up! Since then, the energy sector saw a rise in comparison site usage, with 71% of people searching online to compare prices in 2015.
These days, over half of people say they use comparison sites to purchase insurance policies, energy, and more. Basically, all the cool kids are using them, so there’s a good chance your potential (and existing) customers will be using the web to find a better deal on what you’re offering.
What drives people to compare and switch so often?
People see little or no difference in products or services between companies, and this is why they rarely see an issue with switching from one provider to the other – as long as they can find it cheaper elsewhere, they’re game. This is especially true of products such as car insurance, where it’s common knowledge that switching will result in making a saving.
However, brand loyalty still plays a part. The older generations, in particular, tend to remain loyal to their energy and broadband providers on the basis that they’ve know them for a long time. Despite 2016 being a record-breaking year for energy switching, still only 5% of users actually changed providers in that year. Switching and comparison are still relatively new “trends”, and only the younger, savvier consumers are actually keeping on top of it. Comparison is the future!
Consumers want “the lowest cost for the best [product] for their needs“, and they’re willing to do extensive research – up to a certain point. (Everyone’s a little bit lazy, let’s face it.) Comparison websites are seen as a straightforward, quick, and painless way to compare prices and policy details from different suppliers, and this has made them incredibly popular since they first came about in the late 90s and early 00s. It was a simpler time, when the Spice Girls and MySpace were still a thing.
Transparency and control are two of the main reasons why people choose to compare online before making a purchase. They want to know the product they’re buying, and want to feel like they’re in control of their finances. Comparison websites allow them to see all the information (price, details, and more) all in one place, which is why they keep getting more and more traffic.
However, recent backlash against comparison sites has made some customers weary. What does this mean for the future of price aggregator websites?
Looking towards the future
Price comparison websites are here to stay. More and more sites are cropping up on the web, giving customers more information about their products and how they choose to spend their money. New niches are being found for comparison – gig tickets, train tickets, and more have recently become popular products to compare online.
But as the products and technology evolve, and as consumers become more aware of the way these sites actually work, competition might become fiercer. Will we see comparison websites comparing other aggregator sites at some point? Probably. Stay tuned to see what the next few years bring…
Want to learn more about comparison sites and what they mean for your business? Interested in creating your own aggregator website? Get in touch! We’d be delighted to help.