This week, bonkers.ie hit its fifth year of helping Irish consumers save money on their household bills. It’s been an incredible journey so far and I would like to take this opportunity to share our story, talk about the changes we’ve witnessed since 2010 and, most importantly, thank our customers for helping us reach this important milestone.
Think about this question while reading: if you saw a tenner fall out of your pocket as you walked down the road, what would you do?
How We Work
Web businesses fall into one of a small handful of general categories:
- Informational - providing basic details about a product, service or location
- Transactional - providing information and purchase capability for products & services
- Social - providing an ability to communicate with friends, acquaintances & brands
bonkers.ie is a transactional web business which is focused on the area of retail personal finance. Using bonkers.ie, our customers can find ways to reduce their household bills and manage their household budget and personal finances more effectively. We regularly speak of our products as sitting in one of three major categories:
- money (mortgages, savings accounts, current accounts, credit cards, personal loans)
- communications (broadband, home phone, TV)
- energy (electricity and gas tariffs)
In each of these areas, bonkers.ie is regulated where regulation exists. For example bonkers.ie was the first business in Ireland to be accredited by the Commission for Energy Regulation as a provider of impartial energy price comparisons; likewise, bonkers.ie is regulated by the Central Bank of Ireland in our money category.
These authorisations are important because they provide our customers with a level of third-party trust in the product comparisons we provide.
It is product comparisons that form the bedrock of our switching services; once we demonstrate that a customer can save money by switching, based on the information we display on our comparison pages, our business model is validated once the customer switches product.
More than any other facet of bonkers.ie, it is consumer trust in our information that is of paramount importance to us.
We invest heavily in product data, product analysis and product training which results in the website showing timely information to customers. Our customer support team are fully informed of market changes and our media comments carry the authority of a team which really cares about providing quality data to our audience and our media partners.
Our business went through its fourth major iteration on September 13th 2015.
bonkers-four-point-oh was a complete rewrite of the software that powers Ireland’s favourite comparison and switching service. Being a software engineer by training, I was able to guide our team of in-house designers and developers in the vision for the next five years and the systems which would support our next phase of growth.
They even allowed me to commit to our codebase as it was a multi-month, multi-disciplinary project that required all hands on deck.
Changing Customer Behaviour
As we grow, our business needs to cater to the ever-changing demands of our customers. We need to be usable, whatever the device and whatever the location. We need to be fast, reliable, consistent, up-to-date and, most importantly, useful.
The shift in our customer usage profile from 4% being on mobile devices (smart phones and tablets) to the current 40+% is a sure sign that convenience is a major factor to our visitors. We adopted a mobile-first approach to our site re-design such that the website renders a page appropriate to the device our customer is using, be that smart phone, tablet, laptop or desktop computer.
In addition to the way customers access our website, the product landscape has shifted dramatically since our launch in 2010.
Changes in Energy
In Energy, there are now eight suppliers in the marketplace (four more than 2010) offering a combined 80 tariff combinations to customers. Some have offers only available to new customers, others include discounts for existing customers. For each type of customer, the key is that these are “opt-in” tariffs - meaning you have to agree to a supply contract for a minimum term of 12 months.
You’re not going to not need electricity in your home, so you may as well avail of the deep discounts being offered by the suppliers.
Despite this fact, some 15% only are availing of a discounted tariff - the remaining 85% of customers are on standard rates, leaving over €370,000,000 on the table in unclaimed savings! A portion of these customers simply don’t realise the discount they signed up to 12 or more months ago has now expired, so they are paying standard prices again.
Is it time you checked your tariff?
Collapse of Savings Returns
The Savings Account category has undergone a steep decline in attractiveness for those fortunate enough to have some money in savings.
Firstly, the rate of interest earnings available to savers has tumbled, in line with the ECB lending rate - what’s good for mortgage holders is bad for savers.
To exacerbate this problem, the DIRT has rocketed up from 25% to 41%. The combined reduction in savings interest and increase in DIRT have conspired to the stark reality that earning potential from savings accounts have reduced by a whopping 74% in just the last 5 years. Wow.
With inflation, you’re lucky to keep your savings’ buying value steady. Those who haven’t shopped around for a better savings account rate are really feeling the pain, as some ‘follow-on’ demand savings accounts only offer a 0.01% interest on savings - that’s €1 for every €10,000 on deposit. As a saver in those accounts, you’re losing money by doing nothing because of inflation.
Broadband has fared much better than Savings accounts luckily.
This year alone, we have seen the introduction (as of writing, the rollout has been modest) of the SIRO product family, offering 1,000 Mbps to homes around the country. The next best is 240 Mbps over Virgin Media’s cable network. In 2010, we were distributing 1 Mbps products as an introductory basic deal, and 8 Mbps was considered really fast for a home’s broadband connection.
In the intervening 5 years, the cost per megabit has been slashed down from approximately €20 to €0.087 - that’s a reduction in the cost-per-megabit-per-second factor of almost 4,600. Truly astounding.
Credit Card interest rates have barely moved since 2010, a stat which is reflected by the number of credit cards in issue today. In July 2010 there were 2,197,000 personal credit cards in issue, each with an average balance of €1,302. As of July 2015 there are 1,705,000 personal credit cards in issue with an average balance of €1,014. This represents a reduction of 492,000 credit cards issued, consequently reducing the annual stamp duty haul for the exchequer by close to €15m.
Across all the comparison categories offered by bonkers.ie, the marketplace has shifted significantly for customers in terms of what’s on offer. In most cases, there is more choice and better value.
As for bonkers.ie, what will we be doing over the next five years?
We have invested heavily in server hardware, server software, and our own platform to ensure that the comparison product categories we offer our customers are world class. We are an engineering-driven business, and have grown our staff of developers, designers, marketers and communications to meet the ever increasing demands of customers - and rightly so. Without customers, no business would survive.
The next number of years will see bonkers.ie introduce a range of new products in a whole new category for us. Hopefully these product comparisons will prove as useful to our customers as the existing set, and we will continue to be Ireland’s favourite comparison and switching service.
So as a final word, I would personally like to thank you for using bonkers.ie, for taking the time in finding better deals for your household needs and for spreading the word.
And to answer the question posed at the outset, if you do see that tenner fall from your pocket, what would you do? Pick it up! We work tirelessly so you can easily and quickly pick it up with bonkers.ie.