In an internal message issued on Dec. 6, 2021, Quebec-based price comparison site Prix Assurance Vie (PAV) announced that it was discontinuing its lead generation activities (referrals) for advisors.
Robert Thiffault, president of Prix Assurance Vie, spoke to Insurance Portal in detail about the factors that are driving up the price of leads sent to advisors.Leads are traded in auction mode on the Internet, he says, referring to Internet search platforms such as Google and Facebook.
Strong competition
Robert Thiffault highlights the fierce competition among comparison sites, often called aggregators, in the Quebec market. To successfully generate customers through Internet advertising, businesses must take on some formidable competitors, he points out. “When you want to position your ad higher, you have to fight against Desjardins, National Bank, Manulife and others,” he says.
On Google, the top positions labelled as ads change regularly. A search in French with the keyword string “prix assurance vie” (life insurance prices) on Jan. 7, 2022 returned a list of four comparison sites in the paid (ad) position: Soumissionassurance.ca, CAA-Quebec, Desjardins and InfoPrimes. The website Prix Assurance Vie came in fifth, in a non-paid position, also called natural or organic referencing. The same search performed on Jan. 11, 2022 found that CAA-Quebec was now ranked first, followed by Comparez Prix Assurance-Vie.ca, Desjardins and InfoPrimes. Prix Assurance Vie still topped the list of organic search results.
Searches using word strings such as “comparer assurance vie (compare life insurance)” and “assurance vie (life insurance)” unearthed other competitors. They include ClicAssure, Comparez Prix Assurance-Vie (assurance-vie-parcourriel.com), Viaction Assurance, formerly Sherbrooke Vie, whose main shareholder is Finaction and second shareholder is Fondaction, a fund created by the Confédération des syndicats nationaux (CSN), and Karmaassurance.ca. Karma Assurance was acquired in 2019 by the P&C insurance firm Lussier Dale Parizeau.
Prohibitive price
When it tried to boost its business volume on the Internet, Prix Assurance Vie was spotted by the algorithm of the Web platforms’ search engine, Robert Thiffault explains. “We had a sales force of 40 representatives and we wanted to double our business. But on the Internet, the more volume you generate, the higher your price soars.” The Internet platform will sell the same visibility for an ever increasing price, he adds. Positioning the aggregator higher, to make sure it is seen by more Internet users, is even more pricy.
The fees Google collects thus increase exponentially rather than proportionally, Thiffault points out. “For example, I pay $2 to get two impressions. But to get four impressions, I'll have to pay Google $5, not $4.”
This pricing of Web advertising is eroding the profitability of lead generation, he says. His business plan states that he intends to expand his sales force from 40 to 80 advisors.
Thiffault now believes that increasing his volume on the Web would not be profitable because of the prohibitive fees charged by the search engines. He says he is taking a moment to reflect. “I'm putting operations on pause while I evaluate some options. They include partnering, selling, and finding financing.”
No dominant brand
Aggregators will have to develop their brand to prosper in the Quebec market, he adds. Even though these firms are up against a glass ceiling, Quebecers are ready to buy insurance online, Thiffault says. He also notes that, as digital sales tools multiply, advisors are more inclined to share their commission with a comparison site. So far, though, no aggregator has managed to truly establish its brand in Quebec, he says.
To underline the importance of building a strong brand image before selling online, Thiffault gives the example of Apple. People spontaneously search for “Apple” on the Internet. “You don't buy a cell phone; you buy Apple. To succeed on the Web, you have to develop your brand.”
The Web itself hems in aggregators, he continues. “The next step is to distance yourself from these Web providers. People who go online need to search for your brand in particular, not for the words 'life insurance.’”
To get to the point where Quebec Internet users spontaneously search for the specific comparison site "Prix Assurance Vie", the company would need to invest massively in the brand, adds Thiffault. “A brand like Prix Assurance Vie has to be positioned on the Internet so that people see it.” On a platform like Google, investing in the brand can become a money pit, he believes.
Consolation prize
Available on Hardbacon's site, among others, Prix Assurance Vie's Picki Insurance app is still going strong. “The leads come in because people are looking for us. We didn't pay to advertise,” says Thiffault.
He makes the distinction between Search Engine Optimization (SEO) mode and Search Engine Marketing (SEM) mode, which leads to commercial links. For example, an organic search entered in the Google window for the keyword "Picki" generates the Web address of the application's site.”
