When any major deal crops up that involves your competitors or your industry, you’re bound to take notice.
So it’s hardly escaped our attention that the MoneySavingExpert website, headed by Martin Lewis, was sold today (subject to approval) for up to £87 million to MoneySupermarket.
The good part, for consumers at least, is that the deal includes the retention of editorial independence via an agreed code. In an editorial addressing the deal, Mr Lewis claims that the site will uphold its right to support or criticise MoneySupermarket’s products and services as it requires.
So on the surface, it would appear, little is set to change. And editorial sovereignty, in whatever guise this takes, may be the caveat that allows the acquisition to pass without scrutiny.
This is what we might term a ‘diagonal’ merger rather than a vertical one. In other words, these are complementary services as much as competitors: one an independent advice service with affiliate linking; the other a straightforward price-comparison website. Though it’s clear enough how the benefits will be reaped.
MoneySupermarket wants the traffic, and association with the influential campaigner (or endorsement, we’ll call it, for that’s what it is). And it can afford to buy it.
Mr Lewis has profited hugely out of the deal. Even after the £10 million he is pledging to charity, he will still be left with a colossal £25 million, with a further £25 million in MoneySupermarket shares. An even larger sum (£27 million) could follow in three years. That’s £77 million in total. Wipe your brow.
The MoneySavingExpert site reported revenue of £15.8 million in the year ending October 31st 2011, with £12.6 million in profit. MoneySupermarket, meanwhile, saw revenues increase to £181 million in 2011, with underlying profits rising by 21% to £49.5 million.
Its new advertising campaign, which hooks the company hubristically within its own metaphor, has seen revenues climbing even further; riding on the crest of a wave, if you will. No wonder they Feel Epic.
And this is the underlying problem. Price-comparison is now a big money industry. And like any other industry, the top brass are making enough to flash the cash rather lavishly (excuse the assonance).
It’s far from me, the editor of a much smaller competitor, to quash the merits of what this industry does. And it’s far from us as a company to knock the achievements of our marketplace.
Saving money for consumers is our collective raison d’être. Were the shoes on the other feet, so to speak, and Which4U manned the ivory towers, the perspectives here would be different. That’s undeniable.
But doesn’t it make you feel just a tad uncomfortable to know that profits and revenue of this magnitude are made by individuals and single companies for the purposes of saving you a few quid?
Which4U: With Something to Offer
With that shamelessly concerning statement working away at your conscience, I’ll just humbly reaffirm what Which4U is all about.
We’re a price-comparison website that doesn’t make the world worse through hugely irritating adverts. As we say, tongue-in-cheek, on our About Us page:
It’s enough of a headache working out the best financial products to suit your needs, let alone the many more you’re getting from the companies purporting to cure them!
Which4U = No meerkats. No glass-shattering operettas. No irritating faces (yet). No sky-high profits just through helping customers find cheaper deals.
When it boils down to it, we’re all trying to achieve the same thing. So why should you try Which4U at all?
Well, it’s easy to believe that the biggest names in our marketplace have everything you could ever need to make the best savings. But we beg to differ, and in Beat My Card we’ve got proof on our side.
Come and find us on Which4U.co.uk, and surprise yourself.