Digital TV has taken off, providing another platform from which companies can sell their wares. Alaric Nightingale speaks to Ian Meyer of 1st Quote about its latest venture: being the first broker to sell insurance on digital television.
Q: As the first broker (by several hundred miles) to start flogging insurance on digital TV, how are your profit margins looking?
A: At the moment, digital TV services are very much in their infancy. 1st Quote is interactive on Telewest Communications and Kingston Technology and we're looking to partner further digital providers. Despite the hype surrounding digital TV, not many sites are truly interactive; most simply supply information on a static page.
Nevertheless, our site enables customers to get instant quotes and cover via their televisions. It is the fact that we're increasing the means of accessing our service, rather than revenue, that matters most to us at the moment.
Q: Is the service generating much volume in terms of new business leads?
A: We don't have exact figures at the moment since the service only launched two months' ago. Interest is increasing, but bear in mind that only 41,000 people in the UK have access to digital TV services with Telewest and Kingston. Telewest predicts that four million homes will have digital by the end of 2000. I hope this answers your question. I appreciate where you're coming from, but it's such early days, it's impossible to see how the service will pan out.
Q: How do you draw up a business plan to tap an unknown market?
A: We spotted a niche market for insurance on digital TV and quickly built an in-house team with the knowledge to implement the necessary systems. Our aim is to make our service available to consumers through as many media as possible – including the internet, our call centre, digital TV with Kingston and Telewest, and the latest BT Easicom phone.
Q: How difficult was it to adapt your in-house systems to integrate with digital television? What did you have to do? How many people did you have to appoint? How much do you believe it has cost?
A: It's very difficult to say.
Q: Do you have any concerns that a bigger player – an insurer perhaps – will simply strike a deal with Telewest and Kingston when their services are more established, effectively cutting 1st Quote out of the loop?
A: No, there will always be a market for several insurers on digital TV, just as there is on the internet, and we have signed reasonably long-standing agreements. 1st Quote is one of the UK's leading brokers. It has enough market presence to withstand any competition.
Q: If your digital television operation does take off, do you anticipate taking on many more staff?
A: Insurance on digital TV is in its infancy and no one is really sure how it will take off. I'm confident that more and more consumers will buy insurance through their TV sets. As this happens, the volume of enquiry will dictate the number of required staff.