News from Vertical Leap

June 30, 2005

If you want a full report on Vertical Leap, here’s a list of bloggers covering the event.

This is my quick take:

Vertical Search is pretty darn hot right now and there are a ton of companies jumping into the game. Keynote speaker David Hills, CEO of Looksmart, compared vertical search to the emergence of cable television. Long ago, no one believed there would be a golf channel, soap channel, cooking channel, etc., but those channels and are now thriving. David highlighted BET. While BET’s reach is minimal compared with that of a major network, the channel offers unique programming for a targeted audience. In the end, advertisers are willing to pay a premium to reach BET’s veiwers. The consumers, programmers, and advertisers all benefit.

The same is true of vertical search. Google and Yahoo are great for general research, but vertical search engines know what the users want and can provide ‘correct’ or unique results. Advertisers will pay a premium for this type of targeted traffic.

Unfortunately, though, many shopping comparison engines have thrived simply because they are playing a ‘traffic arbitrage game’ (I might have stolen that phrase from Siva Kumar of FatLens), buying PPC ads on the general search engines and selling PPC ads to merchants for 2-5x that amount. While there is nothing wrong with this model – in fact it’s an extremely lucrative one – I’m just worried that we’re going to see more and more companies jumping on the shopping comparison bandwagon (and vertical search bandwagon in general) which have no place in this world.

As shopping season quickly approaches, expect to see many launches (yesterday OnePAL popped up). I’ll be interested in asking these companies how they plan to differentiate themselves from the established players. Did they develop a new technology? Do they offer features not found on the current engines? Or are they just around to make a quick buck through a smart arbitrage game?

At this point, I have to applaud PriceGrabber which has developed strong traffic through partnerships with over 300 companies and Mobissimo which has built an extremely comprehensive travel search engine and has not spent much (if any) money on PPC marketing. Expect Mobissimo to follow PriceGrabber’s example and develop distribution partnerships as opposed to paying PPC fees.

Ok, I just got back to NYC on a red eye. It’s time to sleep.


American Airlines Working with Mobissimo

June 28, 2005

From Vertical Leap – Beatrice Tarka just announced that Mobissimo signed a deal with American Airlines (AA). Starting in July, AA listings will show up in Mobissimo’s results. In the past, AA has been reluctant to work with travel search engines and even sued FareChase back in 2002.


WashingtonPost eBay Article

June 27, 2005

High quality article (registration required) on eBay from Leslie Walker, Washington Post Staff Writer. It’s another piece on eBay’s growing pains explaining that merchants are looking for alternative ways to sell online. The article mentions ProStores, but does not mention the Shopping.com acquisition.

Here’s an excerpt from the article:
Gary Neubert, a Tampa resident who has sold shipping supplies on eBay since 1999, said he has been steadily building traffic to his own Web site to bypass eBay’s commissions whenever possible. Half his sales today come through his own site, he said. Neubert said he and others are increasingly exploring options outside eBay.

“EBay has been a wonderful place to start and incubate a business,” Neubert said. “Where it has been weak is helping you once you are growing and thriving. The whole Internet commerce evolution has been a fantastic opportunity that only comes along once in a generation, but now we are ready to take it to the next level.”


PriceGrabber Interview – It’s All About the User Experience

June 27, 2005

I talked with Ron LaPierre, Vice President of Business Development at PriceGrabber. Ron has been with the company since April 2002. Prior to his position at PriceGrabber, Ron worked at Overture where he was responsible for the MSN and Ask Jeeves relationships.

How is PriceGrabber different than the other shopping comparison engines?
“Comparison shopping sites have become very popular. We’ve been at the forefront of the growth by focusing on innovation and user experience. Everything we do is with the user in mind.
We focus on many items but a few of the most important are accuracy, transparency, and comprehensiveness. Early on, we added “Bottom Line Price” which allows a user to enter their zip code so tax and shipping costs can be calculated correctly. Most of the other comparison shopping engines today have followed us with this feature, but what you’ll find is that we offer Bottom Line Price across a higher percentage of products and for a higher percentage of our merchant partners.”

How about on the merchant front?
“If you focus on the user, it will benefit the merchant, too. On PriceGrabber, the user has a wealth of information including accurate product listings, user reviews, professional reviews, product condition, rebate information, etc., and all this information is there to help get them as far down the buying path as possible. By the time they click on the merchant’s listing, they are an extremely qualified buyer. Combine those factors with our extremely clean and simple user interface, and we are in a position to be able to deliver an industry leading ROI to our merchant partners.”

What are PriceGrabber’s strengths?
“The last couple years, we’ve added to the breadth of the product offerings. I would have called it a weakness 2 yrs ago, but there’s been a significant focus on adding channels. However, we only do it when it makes sense and when we can deliver the same, consistent high quality user experience that our users get in our existing channels. We now offer our users a comprehensive comparison shopping experience across Read the rest of this entry »


eBay Live!

June 25, 2005

I’m sure you’ve read about the conference by now, but here are some quick thoughts in respect to eBay, ecommerce, and comparison engines.

  • ProStores, eBay/Shopping.com opportunity
  • ProStores is part of eBay’s effort to assist sellers increase sales and reach new customers beyond eBay (WSJ article). ProStores is similar to Yahoo! Store, cityMax, Homestead, and many other website hosting and building solutions. The big difference is the integration with eBay (ProStore users can easily post their products on eBay) and the fact that ProStores is an official eBay service which gives it free access to the eBay community. ProStores also allows for automated feed submission to 4 shopping comparison engines: Yahoo! Shopping, Shopping.com, Shopzilla, and Froogle.

    I informally talked to around 40 eBay sellers – small and large (including a couple Power Sellers). What amazed me was the fact that people in the eBay community know relatively little about marketing beyond eBay. I’d say that about 70% of the people I spoke to didn’t have a stand alone website and knew nothing about shopping comparison engines (or PPC marketing, SEO, Affiliate Programs, etc.). We’ll have to wait and see how eBay integrates Shopping.com into the eBay world, but there is clearly a a huge opportunity here for the eBay community to extend it’s ecommerce reach.

    While sellers who have new products can easily mesh with the Shopping.com listings, I think there is an even larger opportunity for eBay sellers of used products to gain sales through Shopping.com. This could be similar to the used product listing integration on Amazon (see example). Yahoo Shopping already has this type of offering, but I don’t feel that the intergration properly promotes the sellers of used or refurbished products (or auctions for that matter). In this search for a Sony Vaio Laptop, you can see a link for ‘Used & Refurbished’ under the product image. Hopefully you’re still with me and starting to see the possibilities. eBay is already an ecommerce behemoth, but pushing into shopping comparison engines, storefronts, etc. opens up a whole new world.

    OK, enough gushing.


    Shopping.com’s Hotel Vertical Starts to Take Shape

    June 23, 2005

    As reported back in May, Shopping.com plans to tightly integrate its Epinions reveiws into its new hotel vertical and bring “it’s proprietary assets – structure, organization, and productization” to the hotel category. While the vertical is not yet complete, we can now get a better sense of how the end product might look.

    As with the productization Shopping.com has done with its other verticals, users can narrow down choices by features such as Hotel Amenities, Recommended Travel Type, and Room Amenities. This is an improvement over the current categorization on Epinions which only allows users to choose hotels by ‘Chain’ or ‘Recommended Travel Type.’ While Shopping.com has done an impressive job allowing the user to sort by important room amenities such as Sprinklers in Rooms and Toilet (interesting to note that only 169 out of 50,000+ hotels feature toilets!), it’s a little annoying having to choose one amenity after another versus being able to choose multiple amenities at once (Become.com’s new price comparison engine will feature this type of system and SideStep currently offers a similar check-box system).

    After narrowing down choices, users can sort hotels by rating or price. Ratings seem to be taken directly from Epinions.com reviews. While Shopping.com encourages users to write reviews (at the moment, most hotels only have a couple reviews), users are taken to an Epinions page where they eventually have to register to submit the reveiw. The Epinions page looks completely different than the Shopping.com page, so there is a bit of a branding issue.

    At the moment, there are no prices listed for any of the hotels, but hidden at the bottom of each hotel review page, there is a link to compare prices. Once clicked, you see a message which reads “Sorry, there are no offers available from any of our stores at this time.”

    I’ll be in the SF starting tomorrow for eBay Live! and Vertical Leap, so I’ll try to meet with someone at Shopping.com for more information.


    Google Taking Froogle Seriously?

    June 23, 2005

    A rumor from SiliconBeat says that Louis Monier (eBay’s Director of Advanced Technology and founder of AltaVista) might be leaving eBay for Google where he will work on Froogle. This news plus Google’s entrance into online payments might signal that Google’s ready to take Froogle seriously.


    Background to the eBay/Shopping.com Deal

    June 22, 2005

    The behind the scenes story of the eBay/Shopping.com deal. This is taken directly from the proxy statement dated June 21st. (See all Shopping.com SEC Filings):

    Background to the Merger

    Following Shopping.com’s initial public offering in October 2004, Shopping.com focused on developing its online comparison shopping business on a stand-alone basis. During the spring of 2005, Shopping.com’s board of directors and management became increasingly concerned with the competitive threat posed by larger companies such as Google, Inc. and Yahoo! and the possible addition of comparison shopping capabilities by online retailers such as eBay and Amazon.com, and the effect of increasing consolidation on smaller, more focused comparison shopping companies.

    On April 26, 2005, Rajiv Dutta, Senior Vice President and Chief Financial Officer of eBay, spoke with William Gurley, a director of Shopping.com, and suggested a meeting to discuss a potential strategic transaction between eBay and Shopping.com. On April 28, 2005, William Barmeier, Vice President, Corporate Development of eBay, contacted Ms. Norrington, and on April 29 and May 2, 2005, Ms. Norrington and Mr. Barmeier held telephonic discussions during which Mr. Barmeier also suggested a potential transaction. Ms. Norrington reported these overtures to Shopping.com’s management and, on May 4, 2005, to our board of directors, and our board of directors authorized our management to proceed with a meeting with eBay. On May 5, 2005, Ms. Norrington, Greg Santora, our chief financial officer, and Ignacio J. Fanlo, our chief technology officer, met with Mr. Dutta, Mr. Barmeier and other eBay representatives to discuss the potential benefits of a strategic transaction and to provide a general overview of Shopping.com’s business.

    On several occasions between May 5 and May 11, 2005, Ms. Norrington and Mr. Gurley had discussions with Read the rest of this entry »


    $1m Payday for Lorrie Norrington

    June 22, 2005

    Ok, I started to review the Shopping.com Schedule 14A proxy statement (see all Shopping.com SEC filings). Lorrie Norrington, the new President & CEO of Shopping.com must be pretty content with the proposed deal. Shareholders are being asked to approve “the granting of a bonus payment of US$1 million to Lorrie Norrington immediately prior to the consummation of the merger.”

    The bonus is said to cover excise taxes as a result of the merger and to put her in the same “after-tax position as she would have been in if the excise taxes described above were not imposed.”

    Lorrie’s base salary will be $350,000. As of June 7, Lorrie held options to purchase 630,000 Shopping.com ordinary shares.


    Shopzilla Launches zLabs Showcasing Latest Technology

    June 22, 2005

    Cataloging products is extremely difficult. While most comparison shopping engines require merchants to include manufacturer part numbers (MPN), universal product codes (UPC), etc., not all merchants follow the rules and there are many ‘bundles’ which are assigned fictitious unique identifiers. Because of this, all shopping comparison engines run into categorization problems and end up throwing a lot of resources towards solving the problem.

    Shopzilla today announced the launch of zLabs which showcases the company’s investment into R&D to advance comparison shopping search technology. “The first research project to be featured within zLabs is Robozilla, a fully functioning version of Shopzilla wherein all the clustering and alignment of products, prices, availability and images from various merchants is done in a completely automated way. “

    I’m just learning about Robozilla now, so I’ll post an update later.


    Follow

    Get every new post delivered to your Inbox.

    Join 295 other followers

    %d bloggers like this: