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Using Shopping Comparison Sites as New Sales Channel

Employ Product Categorization Strategies when Feeding Products to Search Comparison Engines.

The Internet has paved way for millions of shopping comparison sites like Yahoo! Shopping, Shopzilla, Digxa.com, NexTag, Google Product Search (earlier known as Froogle), Microsoft Jellyfish, among others. Such sites are known to influence the consumers’ purchasing decision to a great extend. Not surprising then, experts are advising retailers to invest in this newest sales channel on the web.

Shopping comparison sites serve as a powerful tool to connect buyers with products. Additionally, these sites enable merchants to feed a list of their products and prices, which are displayed alongside similar products from other merchants when a buyer searches for an item online. For instance, if a buyer visits Digxa.com and types in “Cell Phones,” he’ll see various styles of Cell Phones from a variety of vendors—from major retail stores to smaller players. A buyer can easily compare products, prices, ratings, and shipping costs before settling for the best deal.

Once the choice is made, these sites direct the buyer to the merchant’s or retailer’s website, which are linked back to complete the transaction.

Michael Lambert, CEO of MerchantAdvantage, stated,

“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.”

MerchantAdvantage aids merchants by rendering 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 added. 

Lambert also points out significant changes in the comparison engine marketplace, with more and more companies entering the arena. Many new sites employ a pay-per-click (PPC) advertising model or fee structure. These sites charge a merchant each time a customer clicks on their product at the comparison engine. Other sites like Jellyfish.com use a cost-per-sale commission model, which implies the site makes money if a consumer buys the product from a merchant site.

Lambert asks merchants to carefully examine the fee structure for shopping sites. For shopping sites deploying a PPC advertising model, the minimum click bids can range anywhere from 5 cents to $1 per click at major shopping comparison sites. Such sites generally encourage merchants to bid on keywords in excess of the minimum specified requirements.

In a recent edition of Ecommerce Guide, Mark Bradley, vice president of NexTag, quoted,

“There is a misconception that merchants at shopping engines compete only on price, and that these search environments only drive down margins.”

Bradley believes there are two types of buyers using the shopping engines—those targeting well-known merchants and those looking for the lowest prices.

Small merchants, in particular, should be aware of the products they offer, the price for those products, and the categories where the products will be displayed, since their product could be placed alongside a major retailer’s product.

Finally, Lambert offers two product categorization strategies when feeding products to search comparison engines. These strategies are aimed at merchants, who are contemplating using shopping comparison sites as new sales channel.

  • Search everything and target the least saturated category: Lambert urges merchants to search every comparison engine. By determining which category contains the least saturation of products within their target category, merchants can find out ways to accommodate their product into that category. However, a less saturated category might translate into less traffic. This method allows merchants to grab a larger piece of a smaller pie. 
  • Display products where shoppers are already going: Lambert advices merchants to display their products at a place where shoppers are already going. If their products are 

Competitive in terms of price, merchants should list them in a category that is saturated. Using keywords and relevant information can help their product to stand out. This method allows merchants to grab a piece of a larger pie.


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