As you say crazy funny stuff with these adverts, and people say insurance is boring!

…and of course the CPS rates which each insurer pays will be absolutely identical? Otherwise, you wouldn’t be able to criticise the CPC guys for favouring the guys who pay the most money. Same principle really.

Intersting to hear that you speak to customers to verify whether they’ve purchased a policy or not? Surely that’s very inefficient. sorry, but I don’t believe this one liner!

Knowing quite a few of the insurance IT systems quite well, nobody I’ve spoken to has managed to give me a solid reason not to implement a neutral, third party tracking system between the insurers and aggregators?

The only reason I can think of is that they’d suddenly be reporting a few more sales than they used to!!

All our partners pay CPS and we do exactly the same as QuoteZone with regards to monitoring sales. Our insurance partners also send us monthly quote data and we randomly ask customers who they purchased from and verify this against the partners data.

Until now, insurers have had no option but to pay what the bigger players demand but I think this is starting to change. Certainly insurers are not happy with the new Confused.com payment structure some will have no option but to suffer it for a while but what will they do, maybe increase the cost of insurance to the customer for policies quoted through that distribution channel?

I know a few new players who have tried implementing the CPC model but have not been successful. I prefer a transparent business model than one which favors insurers that pay the most money or even worse, one which gives much cheaper rates to the big brands as aggregators need them on board and then charge much higher rates to the partners that have no option but to pay whatever ridiculous fees are demanded.

I don’t think the CPS guys will be left behind. I think (hope!) we’ll have more partners on board, better rates and stronger relationships …. But maybe that’s me looking through my rose coloured spectacles!

You just need to select your brokers carefully

@Kevin/Hayley

What about yourselves? What proportion of providers are on CPC or CPS? How do you guys keep on top of it? Surely with the expected influx of aggregators to the market (most of which will probably opt for CPC), the CPS guys will get left behind.

At present, we have a standard pricing model of cost per sale. We realise that there is the opportunity for insurers not to correctly report sales back, however, we do run analyses to estimate predicted sales for brokers on our panel based on their pricing and use that as a yard stick to measure their performance and tracking accuracy.

We have a good relationship with the brokers on our panel and while there can still be some sales that “slip through the tracking net”, we have found in the majority of cases that they have been more than helpful in resolving any tracking issues which have arisen.

Fair comment. So, are you saying that QZ let the broker choose their pricing model? For those working from the cost per sale version, how can you be sure that they’ll tell you the truth??!! If I were an insurer on your system, I’d be tempted to not report the odd sale here and there

We at quotezone use a pay per sale policy. However, its not as simple as putting a 1px pixel on a website as not all business is completed online. Many users do like to finish a sale by calling a broker and sometimes there can be a missed tracking opportunity due to this and how well the broker has their systems set up to track.

So I would have to say I agree with what Kevin has posted. Although we at quotezone charge per policy sold, it still comes out of the case acquisition budget for the broker. If they are paying a sensible cost per click, then overall the budget should work out to be roughly the same for them regardless of which of the two pricing models they use.

No excuse!

Surely you could place a 1px tracking gif on the insurers buying confirmation page a stipulation of being on the aggregator system.

Next…

I totally agree that CPC is open to more abuse and that the CPS model (that we use) helps to ensure that customer focus is maintained. However, the problem for all aggregators is ensuring that they get paid for those sales resulting from aggregator quotes.

Quote: ‘Surely rewarding the comparison site for the sales delivered (as I thought you guys worked) is best for every single party involved?’

I did some work recently that showed a very high proportion of sales resulting from aggregator quotes were not being attributed to the aggregators and therefore the aggregators were not being paid for the sales.

If you assume that ensuring the customer gests the same price on both the aggregator and insurer site is a prerequisite (as we do), then the pressure is on the aggregator to ensure that they get paid for any resulting sales, whether that be from a CPS model or CPC model.

I stress that I am a keen advocate of the CPS model and strongly believe that it is the business model that delivers a win, win, win scenario for Customer, Insurer and Aggregator, but I would not condemn those ethically using the CPC model.

The ethical trade off is where the incentives rest for the comparison site. If they use a cost per sale model, they have an incentive to deliver good results to the customer and the insurer. If they operate on a CPC basis, they’re actually rewarded for confusing (excuse the pun) the customer.

With a CPC model, the more times the customer clicks and finds an inaccurate price match between the two sites …or a high excess …or a policy exclusion based on a question which the comparison site didn’t ask …or a price change from the correction of a crucial pre-populated field …the more revenue it generates.

Surely rewarding the comparison site for the sales delivered (as I thought you guys worked) is best for every single party involved?

Why do you think most of these comparison site use the CPC method? Is it because of the selfish reasons suggested above? Or are there other considerations? Would be interested to get your view as an aggregator.