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Comment by tyingq | Hacker News Reader

Google is basically saying that it didn't make enough money. This seems dubious, as the effort should have been pretty low...this isn't rocket science, and the conversion/sales as compared to straight ads would have been higher. The screen real estate these widgets occupy will be replaced with lower performing ads.

There has to be some other motivation.

Edit: See http://imgur.com/a/8c9Xi These have to have a higher CTR and revenue stream than an ad. (edit 2: removed note about other ads being suppressed...happened for a while, then stopped)

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Could be some other motivation but Insurance is a complex business. There are licenses with state departments of insurance, technology partnerships and then carrier partnerships.

Any carrier with existing strong independent agent channels are going to react to consumer comparison shopping with some caution. Carriers simply aren't going to jump right in bed with Google and put their best sales channel at risk.

As I understood it, Google was also asking for too much. They wanted special treatment and wanted to control much of the consumer experience even after the consumer purchases a policy with a carrier.

Google might have figured out the most lucrative part of the insurance shopping cycle is advertising which carriers can control the experience on without creating a downward spiral on market premiums. Google can easily profit in that space with far lower overhead and less disruption to carriers (i.e. the people who pay Google).

This was a service that was up and running. They are also shutting down the entire tool, which was more than just insurance comparison. They have credit cards, mortgages, and maybe other products as well.

And, you don't have be a licensed insurer to display a comparison widget and get paid for conversions...you can drive your margins higher if you have the license, but it's not needed.

Yes the shutter of the entire rest of the service is interesting. Though I can see an angle on why ads are still more profitable.

In the case of their auto insurance quoting part of the business, they were doing something far more sophisticated than just generating leads for credit cards and mortgages. They were actually a licensed agent and generating commissions from quoting and issuing policies. Auto instance is highly regulated and they need to be licensed to do what they were doing.

Three things at play here I see:

1. You are creating new market pressure on the companies that pay you. If companies offering these products stop paying you, then no one pays you.

2. The level of sophistication needed to operate a full quoting service is higher than one would imagine in insurance and I wouldn't be surprised with other financial products.

3. Just sell ads. It's relatively simple, unregulated (relative to financial products) and works in cooperation with (not against) the hand that feeds you.

Perhaps it is not as easy as you think.

Er, ok. It's up and working, right now.

Since Google is able to ensure it's the only ad in the SERPS with pictures, and it sits in the top spot, well...

I suspect the hard part is something other than making money on it. Maybe legal, anti-trust or other concerns?

How do you know it's working?

Wow, I'm surprised they didn't get dinged for anti-competitive practices for that - it looks very much like they were using their near-monopoly in search to try and drive people towards their comparison service and way from other, established players. (I'm guessing not enough people trusted Google to recommend the best comparison site, sticking with well-known ones like Money Supermarket instead.)

Google regularly uses its near-monopoly in search to try to drive people to other Google products. This includes advertising Chrome on its search page if you are foolish enough to visit from another browser.

The Foundem case is a well-documented example of Google's monopoly abuse, as considered by the FTC and the EU.

http://www.foundem.co.uk/Foundem_Google_Timeline.pdf

It could just be me...I tried a few more, and it seems to change quite a bit, sometimes I'm seeing other ads, sometimes not.

>There has to be some other motivation.

Maybe only 50 million people were using the service instead of 100 million.

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