Optimizing retail insurance price in Saudi Arabia
This is part of Growth Studies, a a series of articles about how BrightWrite improves yield for partners. We analyze the impact of product development and making Covid attach rate increases permanent, how one of the world’s largest retailers replaced a traditional insurer and increased their warranty book 513% on Day One while another ticketing giant grew theirs 290%, why price optimization has worked for different reasons in Saudi Arabia, the US, Mexico & Russia and UK & Brazil and the insurance riddle of the Northern Lights.
Saudi Arabia is generally a very inelastic market, where changes to the price do not lead to changes to customer demand – this is shown in the graph where large price increases over time generate great increases in yield and total sales.
Such patterns of consumer behavior can be reflected in Saudi Arabia’s outbound travel market. Saudi Arabians are emerging as one of the largest outbound travel markets, and are the biggest spenders when they travel abroad. By 2025, the Saudi Arabia outbound tourism market is set to surpass US$37 billion!*
Taking into account a nation’s consumer behaviour when implementing product and pricing recommendations through an experimentation platform such as BrightWrite can help show the changes that lead to optimized yield and total sales.
* Source: Kenneth Research, Saudi Arabia Outbound Travel and Tourism Market (2020)