75% of price comparison site users say that they think aggregators should make it easier to compare product terms and conditions. The rise of aggregators as an accepted part of the product research process has been driven by a focus on price, but consumers are now looking for comparison to go further and give greater consideration to product features.

COVID-19 has had a harmful impact on PCWs by removing key prompts to switching in car and home insurance, and massively cutting demand for travel and credit products. However, it has also given consumers time to consider their existing products and research new ones. As the economy bounces back and financial services markets recover, so too will demand for price comparison.

Price comparison sites are well positioned for the future. However, threats remain, primarily through innovation in other financial services sectors. Open Banking and other technological developments are enabling banks and other types of providers to offer aggregation services. PCWs therefore need to keep innovating to stay ahead.

Innovation in consumer credit comparison represents a particularly promising opportunity for PCWs. 70% of PCW customers who have compared consumer credit in the last 12 months would like to be able to get more personalised results.

Key issues covered in this Report

  • The impact of COVID-19 on price comparison sites and consumers’ approach to researching financial services products.

  • Use of price comparison sites for financial services products, and conversion rates from research to sales.

  • Consumer attitudes towards transparency in price comparison.

  • Consumer preferences with regard to price comparison sites and researching financial services products.

COVID-19: Market context

The first COVID-19 cases were confirmed in the UK at the end of January, with a small number of cases in February. The government focused on the ‘contain’ stage of its strategy, with the country continuing to operate much as normal. As the case level rose, the government ordered the closure of non-essential stores on 20 March.

A wider lockdown requiring people to stay at home except for essential shopping, exercise and work ‘if absolutely necessary’ followed on 23 March. Initially, a three-week timeframe was put on the measures, which was extended in mid-April for another three weeks.

The Health Protections Regulations 2020 came into effect on 15 June allowing the reopening of all non-essential stores in England as well as the mandatory use of face coverings on public transport. Pubs, restaurants, hotels and hairdressers were able to reopen on 4 July, with many beauty businesses following on 13 July.

From 24 July, it became mandatory to wear face coverings in shops and supermarkets. Rules on travel remain fluid: from 10 July, travellers from more than 50 “low risk” countries no longer had to self-isolate for 14 days, but on 28 July the removal of Spain from this list of low-risk countries dominated headlines in the UK.

Domestically, there have been limited lockdowns and increased restrictions on social interaction in a number of areas within the UK, meaning that the prospect of a second wave of infections is still front-of-mind for consumers. From 14 September, social gatherings of more than six people became illegal in England, with similar measures in place in the rest of the UK.

Economic and other assumptions

Mintel’s economic assumptions are based on the Office for Budget Responsibility’s central scenario included in its July 2020 Fiscal Sustainability Report. The scenario suggests that UK GDP could fall by 12.4% in 2020, recovering by 8.7% in 2021, and that unemployment will reach 11.9% by the end of 2020, falling to 8.8% by the end of 2021.

The current uncertainty means that there is wide variation on the range of forecasts, however, and this is reflected in the OBR’s own scenarios. In its upside scenario, economic activity returns to pre-COVID-19 levels by Q1 2021. Its more negative scenario, by contrast, would mean that GDP doesn’t recover until Q3 2024.

Products covered in this Report

This Report looks at consumers’ use of price comparison sites when looking to research or arrange financial services products, specifically:

  • Car insurance

  • Home buildings and/or contents insurance

  • Travel insurance

  • Pet insurance

  • Life insurance

  • Current accounts

  • Savings accounts/Cash ISAs

  • Credit cards

  • Mortgages

  • Personal loans

  • Travel money.

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