Is the Proliferation of Shopping Destination/Comparison Sites Good For the Marketplace?

The latest annoucement from my friends at ShopBig.com/myTriggers.com, which I posted below in its entirety, got me thinking about if the ecommerce and mcommerce marketplace can support hundreds of shopping comparison sites and shopping destination sites, i.e., are there enough online shoppers to support the business models of all of these shopping destination sites and can online merchants make money managing so many online shopping sites and return on investment using these sites?

For the online consumer choice is good, but I doubt that many consumers go to more than 3-4 online shopping destination sites to find their products.  Most online shoppers are brand loyal and, after hunting around 3-4 sites for the best price, they usually setttle on a shopping destination site they trust and, most of the time, gives them the best price.  And, if we use alexa ratings as our guide, only about 15 of the online shopping sites break into the top 50,000 of most visited sites on the internet.  But so what?  Is bigger always better? No way!

The reason I say "so what/no way" is because there are many smaller online shopping sites that are excellent sites and make some merchants a good return on investment.  While some shopping destination sites may be smaller, and provide less click throughs to online merchants, they often have a very loyal audience and provide what every merchant really wants, namely, sales, a higher click-to-purchase ratio and clients to market to into the future. 

Look at GolfPricer.com (golf equipment) whose alexa rating is over 6 million, or ToolCrib.com (tools) or ShopandPrice (computers and accessories) both of which are over 700,000 -- does this mean that an online merchant should not feed their product catalog data to these sites, are they bad online shopping sites?  I think not.

Not every online shopping destination site wants, or needs to be, JellyFish.com, Shopzilla, Yahoo! Shopping, Pronto.com, PriceGrabber or Shopping.com.  Some online sites are happy with their business model and making a nice return on their business model and have figured out a way to make money while also helping the online consumer and online merchant to both win!   

I have had some clients decide not to work with the big online shopping sites precisely because the click to purchase ratio is not great and smaller sites perform better for them.

The answer to working with any shopping destination site lies simply in managing your return on investment.  This means managing:

• time to set up, optimize and manage data product feeds
• money spent on working with a shopping destination site, and
• man hours to ensure that you are using shopping destination sites properly, ergo, analyzing ROI

Many "experts" will tell you to only work with the large shopping destination sites. They often say this because these are the sites they are working with and know how to manage. I say test and try several shopping destination sites -- big and small. And find the ones that work best for you.  Some shopping destination sites that really work may be big, some may be small, and many you have never heard of, yet!

I have over 20 clients that send their product feed to over 60 sites each and they seem to be doing quite well.  They must know something!

What Does the Future Hold? How Many More Online Shopping Sites Will We Have?

While I am personally still bewildered by the many new shopping destination sites that keep popping up each month, including high end niche sites as Ideeli.com (a private members only shopping site), ViaLuxe.com (launched by former Yahoo! Executives) and ShoppingVale.com -- let's have some fun with them all -- why not try them, especially if you have the time to manage them and let you analytic tool provide you accurate information on how they are performing for you?

While I personally love the upward trends in the growth of online and mobile commerce and the many new online shopping sites available to consumers -- as it gives the consumer choice and more ways for online merchants to reach customers who are loyal to a certain shopping destination site -- I still can't understand what "really" differentiates each shopping destination site from the other and how they will continue to drive quality, "buying" consumers to their sites, as new sites and choices emerge. 

I like the fact that there are some interesting new business models to attract consumers, as "couparison shopping sites" (as myCoupons.com or CouponMountain.com) and review sites (as Buzzillions.com and PowerReviews.com), but there has to be some shake out soon -- can the market support over 200 shopping destinations sites?   

[Yes, folks, I have 216 shopping destination sites to date on my whiteboard, covering the USA, Canada and Europe]

They are all very similar and very few of their site navigation features are really that impressive for me to be able to fall in love with one shopping destination site over the other -- and please note that, when one shopping destination site offers color matching the rest follow, when one offers reviews the rest follow, when one offers better visual imagery the rest follow, when one offers "green shopping choices" the rest follow -- you get the point = so don't be "wowed" by innovation alone.

Who Cares? The More The Merrier.

Is there really anything radically different that one shopping site will introduce that the others cannot copy within 2-3 months?   Probably not.

Is there any reason why we should not be welcoming new shopping destination sites that might target a niche consumer audience? I can't find one.

The real shopping destination site winners will continue to be the ones that build the most trusted brand and loyal customer base through ongoing innovation, advertising, prices, and superior customer service. 

The reason I say this is because new shopping destination site features are just too easy to replicate.  While innovation is critical, just relying just on new site innovations cannot be relied upon to keep a shopping destination site ahead of the game! 

But in the meantime, the more online shopping destination sites that pop up, and are LEGITIMATE, and provide accurate data on how they are performing, the better.  And the over all winner is......YOU, the online merchant.

The Real Winner is The Online Merchant

I love choice, as it gives the small to mid sized online business more access to potential customers.

So the really good news for online merchants is that if a certain shopping destination site is not bringing you customers and performing the way you expected, there are always others you can try, and I guarantee that there are many online shopping destination sites and shopping comparison engines that are smaller, which will perform just as well as the larger ones...promise!

-- Chip

Comments

[Dylan]

Well said.

I like DealTaker.com myself.