June 6, 2013
Comparison-Shopping Engines: An Overview
It is series time! One topic that we haven’t really talked much about in our blog are comparison-shopping engine sites. I have worked with multiple online retailers that have seen great success with this type of online advertising. So I want to take this series as an opportunity to dive deeper into the mystery of comparison-shopping.
Comparison-shopping has been gaining a lot of momentum in the past few months. More and more consumers are looking to get the best deal on products they want to buy. While shopping in stores, people are comparing prices of the store products on their mobile devices to offers online to get the most for their money. The same can be observed when people are shopping for products online. Although you might be ranking in one of the first places on search engines and users come to your site directly, they will most certainly continue to research prices of products somewhere else. Sites like Nextag, Shopping.com and even Google and Bing are all offering an improved shopping experience by collecting product and pricing information from different retailers and displaying this information collectively on a single results page according to a consumer’s search query. Many retailers are already using this type of advertising for their products and are very successful with it. What do you need to know about comparison-shopping engines and how can you get on this bandwagon?
What are comparison-shopping engines?
Comparison-shopping engines are also called shopping search engines, CSEs or shopping feeds. As the name suggests comparison-shopping engines compare the prices on searched-for-products at different stores online. They evaluate similar merchandise for the consumer and then recommend corresponding links to consumers based on previously conducted searches. This is due to merchants providing their product data feeds to the sites. Based on the product feeds submitted, comparison-shopping engines can sort products in regards to price, shipping rates and seller ratings to make it easy for consumers to compare products in one place – fast and easy. So for example if I am searching for digital cameras, Google and other comparison engines show comparison pages, which feature different sellers that also carry the product as well as price information:
Consumers who click on any of the listings will be directed to the seller’s website. Each visit to your website will be charged on a pay per click basis by the comparison-shopping engine.
Comparison-shopping engines have seen some major growth in the past few years due to the fact that they are able to amplify ecommerce transactions. In 2012 alone, CSE traffic increased by 56% and resulted in ecommerce revenues of over $1 trillion. Google Shopping, Shopzilla, Nextag, Amazon Product Ads, Price Grabber and Bing are well-known examples amongst others.
Why is this important for online retailers?
Retailers in many industries have seen an increase in website traffic of up to 20% that can be attributed to comparison-shopping engines. As mentioned above, online shoppers spend time online to research and compare the products they want. As a matter of fact 65% of shoppers spend 15 minutes or more on comparing merchandise online. 94% of online shoppers are also investing time in finding the best-priced product before they finalize a purchase. Consumers who are viewing products on comparison-shopping engines are twice as likely to turn into a purchase. Ecommerce on CSEs is also growing twice as fast as compared to overall commerce, with Amazon product ads being at the top of the surge. Especially in the new age of enhanced campaigns and improved mobile targeting possibilities, online retailers need to be aware of the fact that 31% of all smartphone owners tend to shop with their phone. Moreover, July to December has seen a 67% increase in comparison-shopping engine transactions on mobile devices. This infographic provides a good overview of comparison-shopping engines and corresponding statistics.
How to get started on comparison-shopping engines?
To get started on comparison-shopping engines you need to create an excel file or product data feed that contains all of your product information that you want to provide to the shopping channels. Different comparison sites will have different requirements for the feed format, so check out this link with the latest information on feed specifications. Once you have your data feed aligned, all you need to do is upload it to the CSE you want to use (we will take a closer look at how to accomplish this when we talk about three CSEs in greater detail later in this series).
To make sure that your comparison-shopping engine experience is a great one, you need to keep a few things in mind:
- Product feeds need to be optimized on a regular basis. Product names and descriptions should be detailed and specifically tailored towards each product.
- A high quality of product images is equally important to ensure a good user experience.
- As with any other online marketing efforts, create a budget plan and think about a bidding strategy. Spending more than you want to or not spending anything at all because your budgets or bids are too low are easy mistakes that can cost you a number of sales.
- While product ads on CSEs are certainly not the “ad” that you are used to creating in Google or Bing, you still need to make sure that you stand out. One of the things you can do is provide detailed product descriptions and information as well as to highlight any promotions that you have currently running for products.
- With your product feed set up and your strategy established you should also ensure to tag your ads with tracking parameters to be able to measure performance.
Don’t stop here though. Comparison-shopping engines don’t run your products on their own. Well they do, but you still have to stay on top of your feed inventory and bidding/budget strategy:
- Submit your product feeds on a regular basis, daily is recommended.
- Review your bidding strategy regularly and re-calculate your bids and budgets for improved performance.
- Follow your competitors and revise your strategies according to market changes.
- Changes to comparison-shopping platforms are very important to watch out for, although they might not happen very often.
- Once you have decided which CSE you want to try for your business, it is advised to become a trusted store in order to promote the relevancy of your business.
Stay tuned for Part 2 of Comparison-Shopping Engines: A deep dive into comparison-shopping engines & strategies, in which I will talk about the 10 best CSEs for increased ecommerce sales.