Practical Ecommerce

Comparison Shopping Sites

With millions of ready-to-buy consumers turning to shopping comparison sites, experts advise retailers to consider participating in one of the Internet’s newest sales channels.

Shopping comparison sites like Yahoo! Shopping, Shopping.com, Shopzilla, NexTag, Froogle, Jellyfish and others serve as a powerful tool to connect buyers and products.

Shopping sites allow merchants to “feed” them lists of products and prices, and then those products are displayed alongside the same products from other merchants when a shopper keys-in a search. For instance, if a consumer visits Yahoo! Shopping and types in “Coleman Sleeping Bag,” he’ll see various styles of Coleman sleeping bags from a variety of vendors—from major retail players to smaller shops. A consumer can easily compare products, prices and shipping costs to look for the best deal. Consumers don’t complete the transaction at the comparison site: They are linked back to the merchant’s site to complete the transaction.

Follow the money

“Online retailers need to be in this marketplace because a good portion of sales across the Internet are coming from the shopping-comparison sites and marketplaces,” said Michael Lambert, CEO of MerchantAdvantage, a company that helps merchants provide feeds to comparison search engines and public marketplaces. “The consumers who come from these sites are buying approximately 25 percent more per sitting. So, when they come to the shopping cart from the shopping-comparison site, they typically spend 25 percent more money than they would have if they just came directly to the site.”

Lambert says there have been significant changes in the comparison-engine marketplace as more companies have entered the arena. Most sites deploy a pay-per-click (PPC) fee structure. These sites charge a merchant for every customer that clicks on their product at the comparison engine. There are also newer models in the marketplace, like Jellyfish.com, that use a cost-per-sale, commission model. Jellyfish.com will only make money if the customer it sends your way actually buys the product.

Lambert encouraged merchants to carefully review the fee structures for shopping sites before beginning. For PPC shopping sites, minimum click bids range from 5 cents to $1 per click at the major shopping sites. Like with other PPC advertising, sites usually allow for merchants to bid on keywords in excess of the minimum requirements.

Mark Bradley, vice president of NexTag, said in a recent edition of Ecommerce Guide that there is a misconception that merchants at shopping engines compete only on price, and that these search environments only drive down margins.

Two types of shopping-engine customers

He said there are two types of shoppers using the shopping engines. The first type consists of consumers considering a well-known merchant, and they will tolerate a somewhat higher price from that merchant, as long as the gap isn’t too large. The second type of consumer is the one that is only looking for the lowest price.

Since a small merchant’s offerings could be placed next to the same product offered by a major retailer, it’s important that a merchant give considerable thought to the products it will post, the price for the products and the categories where these products will be displayed.

For those merchants considering a shopping-comparison site as a new sales channel, Lambert’s firm explained in its April newsletter the two basic product categorization strategies when feeding products to search comparison engines:

  • The road less traveled: Search each comparison engine and determine what category has the least saturation of products within your target category. See how you can fit your product into the least saturated category, keeping in mind that a less saturated category might mean less traffic. This method might allow a merchant to get a larger piece of a smaller pie.
  • Using the busy road: Get your products seen where shoppers are already going. If your products are competitive in price or are distinctive otherwise, list in a category that is saturated. Use keywords and information that help your product to stand out. This method might allow a merchant to get a piece of a larger pie.
Practical Ecommerce

Practical Ecommerce

Bio   •   RSS Feed


email-news-env

Sign up for our email newsletter

Comments ( 6 )

  1. Legacy User July 24, 2007 Reply

    So far my favorite shopping comparison site has been http://www.comparethebrands.com/ because it allows me to put two different products side-by-side and figure out which is the one I want. Most of the sites I come across on Google for "compare shopping" and stuff don't do that. They give you different prices across multiple shopping websites rather than different products. …just thought I'd share that. There is a time and a place for everything. I think a comparison/review type site is best when you're researching your options, and when it comes time to buy a price comparison site is the way to go.

    — *Danny*

  2. Legacy User July 30, 2007 Reply

    I think you are missing an important aspect of shopping comparison sites. If you want to even have a chance to be successful, you must be able to manage your feeds and remove the items that do not convert well. If not, expect an average bite of 25-30% of your profit margin overall on your products… at best. If you only have a 5-10% margin at all, forget it.

    Rich
    http://www.productfeedmanager.com

    — *Richard*

  3. Legacy User August 1, 2007 Reply

    How do I delete products on shopping.com? Is there a UK number?

    — *sponda*

  4. Legacy User August 7, 2007 Reply

    Have you heard of the comparison shopping site called Priceforsure.com?
    They have a live Web TV and and a Web Video. I know they are the first to have this because I researched it. I think it is Exclusive too. You can shop by watching demostration videos of your favorite products or stores. Plus an Auction site for merchants if they have a returned or out dated product AND consumers can put up products for auction as well. They even have a Video blog and chat room for a merchant and consumer. I have not seen a comparison shopping site that has so many features that make you want to shop all day.

    Kevin

    — *Kevin*

  5. Legacy User December 31, 2007 Reply

    Shopping comparison site are nice and extremely useful, however for those that really want to find the best deals on various items, deal sites can not be beat. Deal sites are not as well know as price comparison sites however their deals and prices always seem to be lower than those of the price comparison sites. For serious shoppers and bargain hunters deal sites are the way to go.

    Noe

    — *Noe*

  6. Ricky Ricardo December 25, 2014 Reply

    Shopprice is a largest online price comparison site in Australia. You can quickly compare the current product price in Australia by visiting this website.
    http://www.shopprice.com.au