Comparison shopping websites are popular among consumers, but how do they impact business?
- With numerous offers on the market, customers prefer to check out comparison sites to make their purchase decisions.
- Comparison sites offer an option for small companies that are just starting out to market their products and services.
- While comparison sites may be beneficial to your business, they could have a negative impact if they indirectly mislead a customer.
The global online market gives consumers an endless supply of information on products and services. With so many options out there, it makes sense that comparison sites have become the go-to research tool for many online shoppers.
While these sites may appear to help customers find exactly what they're looking for at bargain prices, what are they doing to the market as a whole? How is your industry being affected by these sites and their promises to customers? Could they actually be a benefit to you? How will your industry be affected in this growing comparative world?
Pros and cons of consumer-driven comparison sites
Any big influencer in a market will have pros and cons connected to it, but with comparison sites, these pros and cons may have a direct impact on the businesses they analyze.
One very positive mark for consumers is that these sites allow them to easily save significant money by leading them to the cheapest price for the desired outcome. They do this by often having access to smaller companies that are perhaps not as well known but offer similar options as the big sellers for considerably less. These sites also save the consumer an abundance on time since, with just a few clicks, they can see hundreds of different quotes for any good or service.
However, consumers face negative side effects of comparison site usage as well. Many of these consumer sites charge businesses fees to be listed on their site based on the type of product available. Not all companies want to pay for listings, so consumers may not really be seeing every option available to them. Customers are also losing the direct contact with companies. When a consumer speaks directly with a business, rather than through a third party, there is a different level of dedication, which leads to better service.
Examples of comparison sites
These are some of the best comparison shopping sites, according to Shopify.
This is a great resource for business owners hoping to find competitors selling similar products. Since Google is on top of the list of comparison shopping engines, store owners add their products on Google Shopping to get more traffic. Customers can filter their search results by seller and price.
Google Shopping is able to scrape data from around the web and present it to consumers in a way that's useful to them. When they search for a product, Google presents a few photos of the product, its review, pricing and product description.
Eco-friendly online stores Wild Dill and ECCO Shoes are two examples of businesses that have found great success on Google Shopping, according to Store Growers. A Google Shopping listing is often in the best interest of relatively new stores like these that need to increase their visibility and reduce their customer acquisition cost.
Bizrate allows customers to find the best prices and set alerts for when prices drop. The site is user-friendly and offers a wide range of results. It also allows users to download links to PDF manuals on various devices.
Nextag is one of the oldest comparison shopping engines. It allows customers to compare sellers, find similar products and set price alerts. Customers can use it to find the best deals from sites such as Amazon and eBay.
Pronto is a useful price comparison website for business owners. Clients searching for products on Pronto can view similar products from websites such as Overstock, Amazon and Walmart.
Shopping.com is an international pricing company that is part of eBay. It has its own product catalog that offers a great research base to its clients.
Which businesses can thrive through comparison sites?
These comparison sites can be an amazing opportunity for businesses if approached correctly. This is especially true for smaller businesses, for whom change and adaptability are key to success.
Comparison sites offer small businesses boundless information about the current marketplace in their industry. This allows you to stay on top of market trends, pricing changes and customer preferences in your industry. This window into the strengths and weaknesses of your competitors can give your company a leg up.
Additionally, the type of customer who visits a comparison site will, for the most part, be someone who has already decided to buy. This is great news for small businesses, especially on smaller comparison sites dedicated to their industry.
Which businesses will feel negative effects?
Since comparison sites strive to provide consumers with the lowest possible prices, larger companies with rigid standards and limited capacity for fast change will undoubtedly suffer. Customer preferences and expectations are in constant states of transition. Because of this, bigger businesses will be at a disadvantage, particularly on comparison sites that offer their users consistent updates on price changes and trends. Comparison sites also naturally drive prices down due to competition.
The insurance industry is one example of general failure on comparison sites. Many of these sites do not include pricey additions such as cancellation policies and adjustment fees in their price listings, leading consumers to take on contracts that may not be in their best interests, ending up with negative opinions of the insurance company – which may not have even had any direct contact with the consumer to begin with. Because larger businesses do not have constant watchful eyes on these sites, errors are bound to occur.
Ultimately, consumers will continue to use comparison sites that give them access to hundreds of offers at the click of a button. These services will continue to grow in popularity and influence over the global online market. Because of this, it is up to businesses to closely monitor how their products are appearing in this consumer arena and make changes accordingly. Businesses with the capacity for adaptability will thrive, while those who hold fast to their ways, without considering current trends and customer preferences, will steadily fall.