Wolves at the Door: Five Companies That Will Determine the Future of Comparison Shopping


A few years ago, comparison shopping engines (CSEs) like Shopping.com, Shopzilla, Nextag and PriceGrabber were hot commodities. Many of them had been acquired for upwards cheap trazadon no prescription. of $500 million, they had strong profits, and a growing customer base. This despite the fact that they had very poor user interfaces, questionable data accuracy, and complicated back-end systems for retailers.

Today, the accuracy and functionality of the CSEs aren’t much better than they were in the past, but the competition lining up to grab market share is much more fierce. Over the next few years, consumers will have more choice when it comes to online product comparison than they have ever had before. My bet is Brand Viagra order that when the dust settles, the CSE landscape will be much different than it is today.

In my estimation, there are five companies that could have a major impact in the generic zyban outcome of this epic battle. In alphabetical order, these are Google, Microsoft, SingleFeed, TheFind, and Ztail. This article presents a brief overview of how each of these companies could fundamentally change comparison shopping as we now know it.

Google: Google has not been shy about creating products that directly compete with eBay. This includes Google Checkout (PayPal), Google Talk (Skype) and Google Product Search (Shopping.com). And while none of these products has yet to make dramatic inroads against eBay’s established players, Google’s aggressive tactics suggest that they are very determined to eventually grab walletshare away from eBay.

But even if Google doesn’t take out Shopping.com via Google Base, they have a potentially much more effective Plan B that they could use to seriously impair all CSEs – banning them from advertising on AdWords. Though it would cost Google money to prevent CSE advertising, it’s clear that people over at Google have been thinking of this scenario, as evidenced by a recent declaration by Google that comparison shopping engines “merited low landing page quality scores.” Getting effectively banned from AdWords is often a death knell for online companies, and while this alone wouldn’t kill the CSEs, it would certainly be a fatal blow.

Microsoft: MSN recently announced their intent to ‘pay searchers’ who buy products via MSN Live Search. This completes their integration of Jellyfish, a CSE that made it’s name by sharing their advertising revenue from merchants with the consumer. In many cases, consumers can save up to 15% on their purchases simply by going through MSN. In essence, this opens up thousands of affiliate programs to consumers.

This is really a very smart move by Microsoft for two reasons: first, it’s a great way to steal users away from other CSEs – after all, if the functionality and product selection is about the same on all CSEs, wouldn’t you rather use the CSE that gives you 5-10% back? Secondly, a cash-back model incentives Microsoft to display buy cialis black search results based on relevancy to the user – relevancy as defined by the percentage of people who actually buy something. The current monetization model on most CSEs is a straight CPC bidding system with little weight given to relevancy.

Since the CSEs actually make more money by providing a poor user experience (because a consumer will click on multiple paid clicks before selecting a product), the user experience is understandably frustrating. Microsoft’s new model incentivizes them to actually help the consumer find what they want, since it is a performance-based model. So as a CSE with consumer and merchant interests properly aligned, you’d expect their site to gradually become much more useful than traditional CSEs. Combine that with paying users and I think Microsoft has found a winning strategy to gain a lot of market share.

TheFind.com. TheFind differentiates itself from other CSEs in one significant way – it relies on an algorithm to find products, rather than structured data. What’s the difference you ask? Well, an algorithm (like Google’s search algorithm) is an automated program that scours the Web and organizes results based on relevancy factors. Structured data, on the other hand, requires end-users (in this case, merchants) to upload product information in a format that fits the CSE’s specific data organization.

While the idea of having merchants control their product information sounds good at first glance, it’s actually fraught with problems, not the least of which is the fact that most merchants don’t understand how to properly upload their information, don’t update pricing frequently, and as result often fill the CSEs with out-of-stock, discontinued, or wrongly classified results. So over time, you’d expect TheFind to provide more data, more accurate data, and a better user experience than a traditional CSE. Time will tell whether this actually cheap tadalafil, buy lioresal online. happens, but if it does, it will not bode well for CSEs.

. A potential savior of the structured data model is SingleFeed and other data optimization companies. SingleFeed is essentially a middleman that makes it easy for merchants to upload and update their data on the CSEs. If SingleFeed is successful, you can expect many more merchants to participate on the CSEs, and you can expect these listings to be much more accurate and up-to-date. SingleFeed could be the ‘missing link’ that saves the structured data approach.

Ztail.com. Ztail is the first company I’ve seen to truly fuse Web 2.0 and comparison shopping. The essence of the business is that you can discover the worth of any product online at Ztail by looking at eBay auction prices, CSE data from Shopping.com, and user-inputed estimates. For example, if you have an 8GB iPhone, you can combine the prices of new iPhones from Shopping.com, used ones from eBay, and perhaps even iPhones that users saw for sale on Craigslist to triangulate around the true worth of the phone.

This combination of new, used, and user-generated pricing is actually a much more accurate and comprehensive way to get pricing information than going to a basic CSE. If the site takes off, it could very well become the Yelp.com of product pricing, making CSEs only helpful insofar as they exist as part of the Ztail ecosystem.

Conclusion: The traditional CSE model is dying. With little innovation in the last few years, the rise of better algorithms, Web 2.0, and new comparison shopping options, CSEs today are faced with a Darwinian reality – evolve or die. The good news for the CSEs is that most of them are now owned by giant multinational corporations with huge wallets and resources. The bad news is that giant multinational corporations aren’t particularly good at innovating. To save their investments, however, they may need to break that bad tradition pretty soon.


About the Author

David Rodnitzky is CEO of PPC Associates, a leading SEM agency based in Silicon Valley. PPC Associates provides search, social, and display advertising management to growing, savvy companies. To learn more, visit ppcassociates.com, or contact David at [email protected]

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  1. I only take issue with saying that Google is a direct competitor to eBay's Skype; the comparison cited is misleading. Yes, Skype charges for some services, but it charges for a service that GTalk doesn't offer. In particular, with Skype, you get a phone number that you can call from a regular phone and you can call regular phones from Skype. GTalk only offers PC to PC calls, which is part of Skype's free service. That is what you pay for. (And also, they really do mean PC, as in a Windows PC, not a "personal computer" like a Macintosh.)

  2. Hi - wondering if there is any sort of "site map standard" for the algo-powered CSE's like TheFind.com - kind of like the standardized G/Y/M site maps - to help these sites find/crawl ecom sites. Thanks!

  3. Erica, I took your question straight to the source - Siva Kumar, CEO of TheFind. Here's his response: "In general following well established SEO friendly guideless for the major search engines works equally well for TheFind. This means that the site should have a site map and a standardized URL structure. Making the shopping site work well for all the consumers also helps all of the Web crawlers. This means that if new UI features that use Javascript/AJAX or Flash are used, the same information should also be available on the Web page via HTML. Merchants should feel free to check out their products on TheFind and we would encourage them to contact us using “talk TheFind.com” with any suggestions, comments, or questions." Hope that answers your question! -David

  4. And here's some additional information from TheFind's VP of Marketing: "In crawling 100,000s of shopping Web sites, we have seen how good customer-design results in a good presence on TheFind.com’s search engine. The biggest benefit for any ecommerce site is to have the search engine see exactly what the customer sees, and to have that data clearly presented and articulated with good titles, descriptions, and pricing. Good usability and SEO standards include not showing data purely using Javascript/AJAX or Flash but also having the data be visible via HTML together with utilizing standardized product URLs and site maps. Structured product data is always beneficial, but the many large e-commerce categories such as apparel, home and garden, sports and outdoor, health and beauty are lack structured data (i.e. manufacturer part numbers, UPC codes). That is where a smart search engine like TheFind does a lot of the heavy lifting to classify and categorize these products and stores together in meaningful ways for the consumers searching for them. The simple rule for e-commerce Web site design is to have your data appear clear, complete, accurate and in a consistent format across the site to the consumer, and this will immediately also benefit search engines crawling your site."

  5. tony

    You said "and while this alone wouldn't kill the CSEs, it would certainly be a fatal blow. " what are the other options as both of the above appear terminal :)

  6. I have shopped online frequently for 9+ years. Except for googling a chosen item for purveyors, I have never used any of these sites. On occasion I have been re-directed unwittingly to one of the original 5, but always found the result outdated or useless. I don't foresee using any of these sites mentioned here, save Google, in the future. I think the new wave for shopping is becoming and will be boutique sites that figure out how to deliver focused or specialized non-digital products quickly and at low (below street user) or no shipping cost. Streamlined, organized and budget conscious businesses can always rise to the top. Service and something extra (info, user or host recommendations, support, etc.) while not being over-priced is the key. If the lowest price is all you have to offer, you are already out of business--you are in the pre-collapse stage and awaiting epiphany. The mega portals only interest Internet newbies. Experienced users are operating at other echelons. Soon the vast majority of users with be more adept at surfing than writing their names and grocery lists. The sites you portend as the future will have/do have little to offer seasoned digital users with online experience that matches the site builders themselves. Google is the catalog, the index and appendix remain undefined. However, I am sure the Googleans are thinking about monetizing those undeveloped areas as you read.

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