Expanding direct distribution
through Internet initiatives
Roberto Hortal
Head of eBusiness
MORE TH>N

Agenda
> Uncovering effective use of the Internet to
issue policies on the spot
> Discovering opportunities in online self-build
products
> Uncovering how to target consumers most
likely to use each channel
> Discovering a powerful new cadre of Internet
distribution tools

Uncovering effective use of the
Internet to issue policies on the
spot

> The Instant Gratification noughties
– 24h, real-time customer expectation
– See, buy, drive away
– I want it NOW
Opportunities

Opportunities
> Integration with main purchase
– Integral to transaction
> Travel Insurance leads the way

Opportunities
> Expanded footprint
– Impulsive shopping: mid/high net worth
– Remote customers
– Complex/custom customer relationships
> Enhanced brand experience
– Frequent visits
– Repeated opportunities for cross/upsell
– Consistent service

Challenges
> Not always a
commoditised purchase
> Legislation/regulation
> requirements
> Technology and
> processes

Future – finally paperless?
> Always on/near me
– Mobile
– In-car > Easy to use
– Kiosk – Search
– Abstract
– Beam
> Always up to date
– MTAs
– Contact info
– Past contacts

Discovering opportunities in
online self-build products

Why self-build?
> People want
– Value
– To understand what they’re paying for
– To feel part of the product
> Control

Risks
> Insufficient cover
> Incompatible combinations
> Too many choices?

Addressing risks
>Give customers a head start

Addressing risks
>Protect your profitability
–The Dell approach
–Branded plays

Extending self-build
>Crowdsourcing
>Make me an offer– The intention
economy
>Working with Generation C
– Content
– Cash

> Atava
Pre-packaged
> The simple flip-side of the coin

Uncovering how to target
consumers most likely to use
each channel

Social Media
> The biggest opportunity in online
marketing
> Participate in conversations
– Listen
– Change
– Communicate
> Your customers on the
driver’s seat

Popular

900
Top 100 keywords over all time
800
700
Engaging green social network
600
Averge time on site
500
morethan living
400
flood advice
flooding summer 2007 summer 2007 floods
300
green motoring
200
long egg
100
morethan
0
0 1 2 3 4 5 6 7 8
Average pages per visit

Living and PHC

When niches go mainstream

Discovering a powerful new
cadre of Internet distribution
tools

The Aggregator effect
Saturated market: always growing spend to maintain share
of voice
Aggregators + new branded entries increase competition for
attention

Through the roof
> From 15% of the online market in 2005
to 50% predicted by end 2008

Everyone
wants in

• Specialisation/positioning
– Different premiums = customer segments
– Different product ranges
– Different propositions (price/value/platform)
Aggregators:
what next?

• Peak Agg?
– Mature market - 65%+
– Share battles - £1M giveaway, win a Boxster
– Cashbacks threaten revenue
– Consolidation, regulation may
be imminent
Aggregators:
what next?

• Could kill the Golden Goose
– Long-term sustainability of insurers
at risk
– Race to the bottom may leave consumers
unprotected
– Shrinking competitive landscape?
Aggregators:
what next?

• Or make it stronger
– Back to basics of direct model
• Lower cost at all stages
• It’s the Customer Experience, stupid
– Customer at the core: reinventing
insurance for today’s customer
Aggregators:
what next?

Cashback
sites

Who are these people?
Source: MoneySavingExpert

Cashbacks and
consumers
• Consumers get rewards every
time they use a cashback site
– Up to 100% of site’s commission
– Down to £0 joining fee
• Cashbacks offer forums, blogs for
members to discuss merchants
– Payment terms/speed most popular
– Service/product review/recommendation growing
• Spreading like wildifire thanks to excellent MGM programs

Cashbacks and retailers
• Taxing access to consumers - parasytes of the online
Marketing world?
– Not really a demand generation tool
– You still have to do all the hard Marketing work, and spend
all the money
• Large volume cashbacks can
drive high bounty
• Purely an added cost
• They are spreading!

Cashbacks and retailers
• High additional CPS across the board
• Selection, profitability impact
– Bounties for Insurance products tend to be flat
• Disproportionate benefit for low premium policies
• Will Aggregators bear the brunt of the cashback
revolution
– Not completing the sale?
– Having to offer cashback?
• Commercial value doubtful

Cashbacks are great social media!!
> WOM fuels growth – social media marketing working at
last!
And rather good at it...

> Very large audience of committed users
– No shortage of enthusiasts of your brand
> Huge collection of user-generated content
> Finely tuned WOM program
> A social Marketer’s dream!
Cashbacks: Dive in

Mobile
> Personal
> Trusted
> Always-on
> Location

Car
> Enhanced mobile
> Telematics
– PAYG
– Differential pricing
– Groups
> Your brand,
delivered
to where most relevant

Thanks!
Roberto Hortal
roberto.hortalmunoz@uk.rsagroup.com
www.morethan.com
All photos: Flickr users via FlickrStorm