The KDDI alliance and the end of internet-only selling (2015)

Borrowed credibility, forfeited outline

For a company selling contracts that run for decades, being new is itself a reason not to buy. That Deguchi Haruaki named the purpose as “supplementing credibility” rather than raising money reads heavily when it is placed where it belongs — after price cuts and new products had both failed to arrest the fall in new policies. When a problem remains that neither product nor price can solve, the move left in hand is to borrow credibility from outside the company. The decision effectively to abandon internet-only direct selling, the banner Lifenet had carried since it opened, is easier to understand in that sequence.

It is hard to argue, though, that the alliance stopped the stall. The au channel stayed at a level the company itself described as not having realised the intended use of the channel, and the ¥13.5 billion revenue target for FY2018 was missed. What eventually turned new policies back up was, in the end, marketing spend on internet direct selling. Nor is “Lifenet gave up being an online insurer” an accurate summary. The principle of employing no in-house sales staff held; what changed was the number of channels, and the fact that a telecoms company now held a quarter of the votes.