March 4, Mumbai: When it comes to evaluating whether a new product would be a successful or not, a report “Insurance: Reading Google searches as lead indicator of business trends” by Kotak Institutional Equities Research believes that Google search trends can be used to gauge success of new products. A google search trends also helps understand a pick up inflection points and understand growth and market share movements of the products. As per the Kotak, they would continue to test these hypotheses over the next couple of months of reading such trends as leading indicators.
That said, the research house studied a data from FY2004 onwards to understand the relationship between Google search trends for keywords like ‘life insurance, term insurance’, companies like ‘ICICI Prudential Life’, ‘HDFC Life’ and key products like ‘click2protect’, ‘iprotect’, ‘eshield’, ‘Sanchay Plus’. Also, it studied a growth in the individual Annual premium equivalent (APE) over the similar periods. “We find a fair relationship between Google search trends and APE growth, adjusted for some lead-lag impact. Thus, one can study trends in Google search volumes for specific life insurers to gauge likely trends in monthly premium growth, most-selling products, inflection points and market share movements,” claims the report.
For instance, as per the google trends, LIC reported a strong growth in their individual business in November 2019 as January 2020 on the back of higher volumes from select sunset products such as ‘LIC Jeevan Labh’ and ‘LIC Jeevan Anand’. In the same time period, the searches for these products were at distinct peaks. Similarly search for ‘HDFC Sanchay Plus’ peaked in June 2019 and November 2019—witnessing a strong growth in these two months.
However, ‘ICICI Prudential Life Insurance’ had witnessed a 10-50 per cent decline in searches during September 2018-July 2019—a period in which their individual business was muted (-24 per cent to +14 per cent). “Overall search volumes for ‘term insurance’ have increased rapidly over the past few months from FY2015-18 levels. This is in line with the strong growth in term insurance APE for most life players,” points out the report.