How do electricity traders make money

How do consumer portals make their money?

• When competition began in the electricity industry in 1998, tariff comparisons were easy. The new providers could be counted on one hand. They made prices slide. Risk-averse customers also benefited. After two years, the energy giants pulled the emergency brake: They increased their network usage fees. The independent pioneers promptly went bankrupt; the customers looked into the tube.

Since then, electricity has become more and more expensive, although in Germany you can now choose between hundreds of tariffs and 60 percent of households have heeded the appeals of brash politicians to simply look for a cheaper provider on the Internet. The remaining 40 percent who have remained loyal to the "basic supply" - ie the normal tariff of the former regional energy monopoly, which has not been pimped up by any kind of discount or eco-label - are not necessarily stupid or have too much money.

The dangers of saving are absolutely real: In relevant network forums, customers complain about their painful experiences with electricity traders who are subscribed to top positions in comparison portals. The basic pattern is reminiscent of the gold rush days of the telephone savings codes: innocent consumers fall for suspiciously cheap top offer, which turns out to be an extra boomerang.

The audacity with which energy marketers cheat on number one amazes even experienced industry observers like Jürgen Schröder. "A Berlin company," says the lawyer from the North Rhine-Westphalia consumer center, "once sold a kilowatt-hour for eleven cents!" The customers' joy about the dumping tariff quickly evaporated: after a few months they were faced with a 120 percent price increase. So the dealer didn't want to pay extra in the long term. He had just tried a special type of search engine optimization.

Illusion and disenchantment, customer disappointment and disappointment are inevitable collateral damage to the business model of comparison websites such as Check24, Transparo or Verivox. In costly TV commercials, the portal operators present themselves as selfless scouts who cut a path through the tariff jungle of the energy, telecommunications, travel, finance and insurance industries for their price-conscious target group. In truth, they owe their existence to an intimate symbiosis: Just because the providers create thickets of special offers, bonuses, questionable footnotes, clauses and terms and conditions - a fact that they do not hang on to the big bells but also do not hide - comparison portals make sense at all .

Their target group are the spoiled normal Internet users: people who take it for granted that everyone in the world provides them with trustworthy information for free. According to a study by management consultancy AT Kearney, the number of customers willing to switch in the electricity market will increase from seven million in 2011 to twelve million in 2016. The development on the gas market is similar: in the same period, the number of 1.2 million people willing to switch will increase to 2.2 million. According to the study, 80 percent of all private household customers inquire on comparison portal sites.

If you want to run such a tariff portal successfully, you have to follow the same basic business principle as Facebook or an advertising-financed television station: "The product is you."

The moment an electricity consumer or policyholder clicks on his future contract partner in the browser, he becomes a product, a commodity. It is sold to the portal's actual customer, the provider; this pays a commission per deal. If it is high in the hit list, it is almost always a pure sales company that operates under several brands and does not generate any electricity itself.

If you don't want to fall into the wrong hands, you have to be careful yourself. The operators of the comparison machines are neither liable for black sheep who hide behind their portals, nor do they guarantee that they always know the cheapest supplier. They understand their data collections as "non-discriminatory": Everyone can participate on the same terms, as long as they have not fallen out of favor with the supervisory authorities. In the case of electricity, gas and telephone, this is the Federal Network Agency - and they are not known for taking action if customers think a company is dubious.

Transparency and lack of transparency are therefore like Siamese twins on the comparison portals. The added value of both parties depends on the appearance in a double pack. The more complex markets a portal covers, the easier it can be to position itself as the first general-purpose point of contact for frugal consumers. That is why Verivox from Heidelberg - started as a telephone specialist in 1998 - has added insurance to its range after electricity and gas.

If you take a closer look, however, you will discover that behind it is the Augsburg-based Transparo AG, which is at home in the financial sector and which in turn buys data from insurance brokers such as Mr-Money from Stollberg in the Ore Mountains. In return, the Swabians access the Verivox energy tariff calculator. Their mutual opponent is the Munich-based company Check24. It emerged from online insurance broker E-Insurance through mergers and acquisitions. Check24 Co. pass on part of their commissions to their allies - blogs or other portals that offer the service under their name and receive a share of the commission.

These partners of the online economy are an integral part of the business models: Following the example of the mail order company Amazon, the large comparison portals allow visitors to be directed from other websites who want to earn extra income. The unsophisticated surfer only notices that everything is fed from a handful of original data pools when he repeatedly comes across strikingly similar search masks.

With their large reach, the comparison sites have in turn made themselves indispensable for many electricity, gas, telephone, insurance and travel marketers. The symbiosis between comparators and compared is so close that the portals have direct access to the IT of their customers. That is why the data is always up-to-date. However, they are not complete: The car insurers HUK-Coburg / HUK24, HDI and WGV are missing from Check24's hit lists. You can only find them at Transparo. This portal is owned by the HUK - and is therefore boycotted by the Allianz subsidiary Allsecur. "Coopetition", as the Americans call cooperation with rivals, is not for everyone in this country.

The portals earn money not only with commissions, but also with advertisements and a valuable waste product of their activities: current customer data. Nobody recognizes demand trends earlier and more precisely, nobody tests the acceptance of new offers faster than a portal that only provides information to someone who enters some key data in return. In practice, the electricity customer does not see a clear list that is sorted according to kilowatt hourly prices and monthly basic fees, from which he calculates his costs with the pocket calculator. Instead, he is shown the total annual costs incurred in his place of residence with a certain consumption.

The search results with the standard setting often look like a mixture of apples, pears, quinces and windfalls, the beautiful side of which is up. There are power packages for which each additional kilowatt hour is charged absurdly expensive, but under-consumption is not reimbursed. Consumers who only want to compare crunchy apples with one another have to narrow down their search further - and thus feed the statistics. The data is the price that has to be paid if you want clean, filtered results for free. -