Price comparison websites used

A large majority of consumers (85 per cent), who have used a PCW in the last two years, have used one or more of the Big Four, while fewer than one in 10 (eight per cent) have used only other sites.

Figure 4.7: Price comparison websites used

Younger consumers are more likely to use the Big Four PCWs than older groups are: the vast majority (91 per cent) of 18-29 year-olds and 30-44 year-olds (93 per cent) use them, while the proportions among the 45-59 group (86 per cent) and 60-74 group (80 per cent) are slightly lower.

Customers feel that the fact the Big Four sites are the first to spring to mind, results in their using them most often. As Section 4.2 has described, these PCWs are typically front-of-mind because consumers have seen or heard recent advertising.

‘Originally, it must have been TV adverts or radio adverts. I think Confused.com is always on and so is that comparethemarket.com one. Probably, it must have been from there.’

North East, SEG B, 30-44, heavy internet user

‘It’s because I see the advertising. The first thing when I sit down, I think,

"Confused.com".’

Midlands, SEG B, 60-74, heavy internet user

‘Google. If I can't remember the name then I will just put in "comparison insurance" and then it will come up.’

Wales, SEG C1, 30-44, heavy internet user

There is little evidence of loyalty – no consumer said that they used a particular site ‘out of habit’ for example, and there was often hesitation as they named the ones they had used.

Consumers told us they simply used sites that come to mind when they start to shop around or research a purchase.

‘Something money.com? I was on that the other night.’

Scotland, SEG C1, 60-74, light internet user

In general, consumers don’t make a conscious choice to use a sector-specific or a more generic PCW. They often rely on the Big Four sites, because they know that these sites offer a range of the products they are looking for. They learn this either through advertising, previous experience or recommendation.

‘Ultimately, it doesn't matter. As long as the information they give you is decent, it could be one website that covers everything. But in my mind, I use Moneysupermarket for more financial-based products and Go Compare for the car insurance. That is what I am used to. I know that Go Compare now do other stuff but to me it is largely irrelevant because if I wanted to check up on financial products I would go to Moneysupermarket.’

Wales, SEG B, 45-59, heavy internet user

A few respondents also mention that using sector-specific websites makes them focus on the search in hand, rather than distracting them with other potential services or products.

‘If you know what services you are looking for, you can get straight to it. I think the more services and choice you have, you just get confused as to why you are on there. I think you can spend too long sometimes faffing around.’

Midlands, SEG B, 30-44, light internet user

How consumers find price comparison websites

Consumers arrive at PCWs via different routes. Just over one-third (35 per cent) go to the sites directly, by typing the site address in a browser window.

A further one-third (31 per cent) use a search engine to locate a specific PCW, typing its name in to access the URL. The same proportion (31 per cent) use a search engine to produce a list of different PCWs, then choose one to visit.

A much lower proportion use a search engine – typically Google – to search for ‘cheap [product]’ or ‘compare [product].’ Recommendations from others may also persuade consumers to try out sites that they have become aware of through advertising.

Figure 4.8: Finding price comparison websites

Why consumers use PCWs

When prompted on what they might use a PCW for, consumers’ principal aims are to get the best deals (85 per cent), compare prices (83 per cent) and, consequently, save money (79 per cent). This echoes a finding from research conducted by the National Consumer Council (2005),²⁶ in which more than three-quarters (77 per cent) of consumers said that they liked to shop around between different providers to get the best possible deal.

Figure 4.9: What price comparison websites are used for

26 National Consumer Council (December 2005) Switched on to switching

More than two-thirds of consumers (69 per cent) also agree that they use PCWs to identify the providers that offer the particular products or services they are looking for, or to make a switch between providers (67 per cent). Two-thirds agree that they use PCWs to save time (65 per cent) and to inform them when considering switching providers (62 per cent). In total, more than eight in 10 consumers (82 per cent) say they use PCWs either to switch, or to consider switching providers.

Slightly fewer consumers use PCWs to carry out more general research. Just over half (53 per cent) visit PCWs to identify the different product or service bundles that are available on the market. Just under half (47 per cent) visit them to carry out more general (ie, not price-specific) factfinding about products and services they are interested in. Fewer consumers – one-third (35 per cent) – say that they use PCWs to get general advice on products or services. This is understandable: relatively few PCWs provide advice or even reviews within the information that they offer.

Overall, eight in 10 consumers (83 per cent) use PCWs to compare prices for specific

products. Approximately nine out of 10 consumers in socio-economic grades A and B do this (97 per cent and 88 per cent respectively) than among socio-economic grades C2 and D, where around three-quarters do so (78 per cent and 77 per cent respectively). Similarly, significantly more consumers in grades A and B use PCWs to actually switch providers.

In addition, significantly fewer young consumers aged 18-29 use PCWs to source general advice on products or services (26 per cent) than consumers aged 30 or older where the proportion is one-third or more.

These data indicate that consumers in socio-economic grades A and B either have a more well-defined idea of the product or service that they want to purchase, or take less time to make a decision, than those in other grades.

Products and services consumers use PCWs to investigate

Car insurance is by far the most commonly investigated category. The majority of

consumers, who have used a PCW within the last two years (81 per cent), have used it to compare prices for car insurance. The next most frequently-mentioned category is home insurance, with half of consumers (50 per cent) having used a PCW while seeking this.

These findings correspond to research by Andrew Smith Research and Research Now (2012),²⁷ which also found car and home insurance to be the categories where consumers had most often considered switching.

More than two-fifths (44 per cent) of those who have used PCWs have used one in

connection with gas or electricity deals, and one-third when shopping for travel insurance (32 per cent) or rail fares (31 per cent). Fewer consumers have used a PCW to investigate mobile phone services, (21 per cent). Fewer still (13 per cent) have used a PCW while shopping for cable and satellite TV packages.

27 Andrew Smith Research and Research Now (2012). Customers in Britain 2012

Figure 4.10: Products/ services that price comparison websites are used for

If we consider the product and service types that PCWs typically cover, the general pattern here is that consumers are often using PCWs in purchasing:

 products highlighted in PCWs’ advertising: all of the Big Four have promoted their use in connection with car or home insurance

 products that they buy most routinely: for example, insurance bought at the same time every year; and

 products that are relatively expensive: for example, insurance premiums and utilities.

The proportion of consumers using a PCW to shop for car, home or travel insurance is higher among grades A and B, and lower among grades D and E. For example:

 the majority in socio-economic grade A (88 per cent) and three-quarters in grade C1 (76 per cent) have shopped for car insurance via a PCW, compared with two-thirds of those in socio-economic grade E (67 per cent)

 two-thirds of those in socio-economic grade A (67 per cent) have shopped for home insurance using a PCW, compared with half in grade C2 (50 per cent) and a quarter of consumers in grade E (25 per cent)

 more than one-third of consumers in socio-economic grades B (36 per cent) and C1 (35 per cent) have used a PCW to compare prices for travel insurance; less than one-fifth have done so among grade E (17 per cent).

The youngest consumers – those aged between 18 and 29 – are also significantly less likely to have used a PCW to compare prices for gas or electricity, than consumers in most of the older age groups. Just over a quarter of the 18-29 group (28 per cent) have done so, compared with half of the 45-59 group (50 per cent), and more than half of those aged between 60 and 74 (53 per cent).

Significantly more consumers in Wales have used a PCW while shopping for car insurance than in England: more than nine in 10 (92 per cent), compared with eight in 10 (80 per cent).

What consumers don’t use sites for, and why

As we have seen, the extent to which consumers have used PCWs in their decision-making varies according to different products and services. As Figure 4.10 shows, consumers use PCWs less frequently when planning purchases of travel insurance, rail fares, mobile phone, broadband and TV bundles, than when choosing car insurance, home insurance, or a utility provider. This is likely to be at least partly explained by the fact that some products or services are purchased less frequently. For example, a number of consumers in the

qualitative research explain that they have not needed travel insurance, because they have not taken a holiday abroad recently. Likewise, many consumers have not sought to review their broadband or mobile phone provider as they are tied into a contract.

‘For things like broadband I am tied into my current provider for some time, so if I have tried to negotiate a deal I have done so directly with them.’

Wales, SEG C1, 45-59, heavy internet user

‘Trivago - that is a holiday thing but I never go on holiday. I have seen that advertised on television. There is tons of them, isn't there, but I just don’t have the need for most of them. My electricity and water is basically my outlay.’

South East, SEG C1, 30-44, light internet user

There is little resistance to using PCWs for any specific kind of product or service.

‘It is silly not to really, isn't it, because you are just saving yourself so much time. I certainly wouldn't rule out looking for anything, really.’

Wales, SEG C2, 30-44, light internet user

4.6 Consumers who don’t use price comparison websites