"We're not on price comparison websites because..."

You know a good way to spot when an explanation is just an excuse? It keeps changing. 

Direct Line tells us they're not on price comparison websites. Indeed, the company has been boasting of its refusal to compete on price for rather more than a year now.

The reasons an insurance company might not to appear on price comparison websites are, admittedly, more complex than a mere desire not to compete directly on price. There are potentially sound business reasons to want to own the customer relationship. But since those reasons are mostly to do with preventing the price comparison site from selling those customers cheaper insurance from a new advertiser at the end of the year, they aren't an explanation you can tell the customers themselves. So over the course of more than a year we have seen, instead, a series of bizarre excuses.

All the way back in the summer of 2009 the claim, played out as a dialogue between Paul Merton's red mouse and Stephen Fry's red phone, was charmingly straightforward - "we're not on price comparison websites" ("oh crumbs no") ("thanks but no thanks") "and we can give you savings" "so you can never be sure of the best deal until you've come to us direct". No attempt at an explanation - we're just not on price comparison websites so you'd better get in touch with us directly to see whether we're cheaper than the best offer there.

An even less explanatory ad celebrating the company's 25th birthday simply claimed that cutting out price comparison sites meant "loads of money" - for whom is not made clear. 

Here's one from January 2009, where the excuse had shifted again, perhaps to explain the "loads of money" claim - "we're not on price comparison websites, so we don't pay them commission". (Implying during a prime-time TV ad that prices are kept low through savings on marketing expenses means some worrying assumptions about the intelligence of the audience, but the sheer chutzpah must be admired.)

And this year we have a new set of ads that have have dropped the Fry / Merton team in favour of Chris Addison and Alexander Armstrong (and may therefore be the only TV ads of 2011 not to feature the voice of Robert Webb). These play out a new dialogue with Addison as the salesman and Armstrong the sceptical insurance buyer and "explain" the absence from price comparison sites as a preference for dealing with customers directly. True, as far as it goes, and it's good thinking to try and make Armstrong's intelligent scepticism in the face of salesmanship appear foolish and absurd, but they're still missing some key pieces of information.

Price comparison websites are good for customers. They compare prices, so you can see which deal is cheapest, and over the course of the past ten years the price of the cheapest products on them has therefore fallen to roughly the cost of providing them. This is bad for suppliers since it drives their margins close to zero, but there are a number of ways for them to get around that. The obvious one is the sort of long-term bait and switch beloved of the financial services industry - offer an unprofitably good deal in year one and then assume customers won't bother to check in year two whether the price has been whacked up to a level that makes a bit of profit. Problem is, if the customer has come in through a price comparison site in the first place the site can pre-empt this strategy by knowing when the current deal runs out and just emailing the customer the currently best deal from someone else when it's time to renew.

Hence, really, "we're not on price comparison websites". Insurance companies want to make money. Of course they do. Price comparison websites largely prevent them. And the ever-shifting "explanation" is just a give-away that they can't tell their customers why.