Diversifying Your Business: Broadening Your Product Portfolio
You're reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.
Over the last five years, compareit4me.com has seen some rapid and exciting expansion. We felt that we had reached a point, and had enough stability in our core business, where we could comfortably look at additional lines of revenue and new ways to differentiate ourselves. We looked at the more mature markets to see what was driving both user and financial growth, and car insurance was the stand out product. Having figured out that car insurance was the direction in which we wanted to go, we set about finding the best team and drafting a plan that would ultimately see us launch a regional first. Now just weeks away from its launch, we’re very excited about bringing this innovative idea to the UAE.
The timing of adding additional products or expanding one’s geography is probably less about a set time or a set formula, and actually more down to the nature of the business and the economics of that business. For us, we were able to expand to nine countries with relative ease and with minimal financial commitment because of the structure of our business. We were able to benefit from economies of scale, using Dubai as our central hub for services, like marketing and IT, and only needing to deploy sales teams into new markets. If, however, you have a business that requires a physical presence in the country, i.e. opening an office, a country manager/MD, and a country-specific team, it would be prudent for businesses to ensure they have enough leeway to deal with the most pessimistic scenario. Things rarely go your way. It would probably be good, therefore, to know that the existing business is already profitable, or at least on a path to profitability, and can potentially absorb any losses from expansion.
The key for us, however, was not to stretch our resources and management bandwidth too far. We initially opted to add to the business with geographical expansion, something we will continue to do over the next few years, leaving additional verticals until we felt we had the right team in place.
Launching car insurance has always been on the agenda for us. Comparing car insurance products and allowing people to buy online has a natural synergy with allowing people to compare financial products. When we initially launched our finance comparison, we opted for the product offering that would allow us to get to market the quickest- basically, the least technical solution we could go with. The ability to take insurance quotes from a number of different insurers and display them in an easy to compare and digestible form is actually extremely difficult and it’s taken our team a huge amount of effort to crack this challenge.
Car insurance is an important vertical for us, and it has always been understood by us and our investors that we would one day need to play in this space, if we were going to maximize our potential growth as a company. As for the timing, we wanted to wait until we had enough resources internally and until we felt like we had the ability to deliver a solution that would benefit customers.
Before deciding to build the car insurance portal, we looked at whether we could have an impact on, and ultimately disrupt, the way car insurance was both compared and bought in the UAE. When we looked at the UAE insurance industry, there were a number of factors that validated our plans to bring insurance comparison to the region.
The first was the lack of competition. The fact that we are able to launch with no existing insurance comparison portals live, gives us an opportunity to launch with the least amount of friction, enabling us to penetrate a larger portion of the market for less investment.
The lack of any existing car insurance comparison portals in the region meant that our impact on consumers’ current experience would be immeasurable. Our analysts have suggested that users of the compareit4me portal will save up to 30% on their annual premiums, and best of all, the process from start to finish only takes three minutes.
Looking globally, insurance and finance has gone through a huge amount of disruption. The way people find and buy these products and services has changed dramatically with the advent of comparison sites. When deciding whether insurance was a space we wanted to be active in, we looked at the established comparison markets, like the UK, and found the impact they’d had on the decision-making process of the everyday consumer was so great that we wanted to do all we could to introduce a similar, yet localized solution to the UAE.
As a business, we felt that the introduction of insurance comparison would not only set us apart from competition, it also creates a huge barrier to entry to others considering a startup in the car insurance space. We have an amazing team of developers, who went above and beyond to produce a platform that is extremely hard to replicate. Having an engine that can take the quote variables of every insurer in the region and instantly give users a tailored quote is extremely difficult and something we’re very proud of.At compareit4me, we often go with our gut feeling. We get excited about something– we do the research, but we don’t get bogged down in numbers. Whether it’s adding new products, launching a new country or creating a new vertical, as a business, we like to get a solution live quickly and iterate as we go, often remembering the mantra “perfection is the enemy of execution.” It is important, however, to balance gut feel with good advice and past experience, wherever possible. In our case, we often bounce ideas off mentors, board members and our team, and thus make the best decision to take our business forward.