Considering that CEO Sergei Burkov is not getting back to me, I have to assume that Dulance has shut its doors. Which is very very odd to say. The history of shopping comparison engines is a very very positive story. Yes, there were some hickups along the way, but in general, every shopping comparison engine which had a VC investment over the last 11 years had a successful exit:
Jango acquired by Excite ($35m)
Junglee acquired by Amazon ($250m)
C2b acquired by Inktomi Product Search ($90m)
MySimon acquired by CNET (
$350m $700m…sorry Michael!)
Dealtime/Epinions formed SDC acquired by eBay ($476m)
Bizrate renamed Shopzilla acquired by EW Scripps ($560m)
PriceGrabber acquired by Experian ($485m)
NexTag acquired by… ($850m+)
And the shopping comparison engines, IMHO, are at the beginning of a strong growth period which will see them morph into more comprehensive/relevant and therefore more powerful shopping search engines.
People talk of Google kicking Yahoo’s ass back in the day because Google’s search results were an order of magnitude better than Yahoo’s search results. The top shopping comparison engines, while profitable, growing businesses, have been sputtering along in terms of merchant adoption, which adversely effects their ability to develop a shopping engine an order of magnitude better than plain old Google or Yahoo! search results. Most shopping comparison engines only have around 5,000 feeds. This is due to 2 factors.
First, data feeds are difficult to create, submit, and manage compared to the relatively easy to deal with Adwords and YSM ads. Data feeds take a lot of time and effort to set up and because each comparison engine has different required fields and unique categories, it can take 2 hours to set up each feed. Then merchants have to deal with submission which many times comes down to a FTP upload. File Transfer Protocol is one way to read that. Fuc%&*# Troublesome Process is another, especially if you’re a small business with no tech resources.
Second, because most shopping comparison engines have price floors, they automatically limit the number of products which merchants will submit or will continue to submit to shopping comparison engines. If I sell an Ademco 940 Surface Contact for $2.89 with a 52% margin, that means I make $1.50 per sale. Unfortunately, many of the shopping engines put me in an electronics category with a minimum bid of $0.50. That means that I’d have to convert a sale once every three clicks for the channel to be profitable. HA! I’m the first to admit that shopping comparison engines can convert well, but a 33% conversion rate is not going to happen.
Fix just one of these 2 factors, and merchant adoption will rise, leading to more comprehensive/relevant comparison engines which wouldn’t need to supplement results with Google Adsense. These engines might even become the starting point for shoppers (imagine not having to spend all your marketing dollars to acquire shoppers through Adwords and YSM). Froogle, which I’ve been critical of in the past has amassed around 50,000 merchant feeds (no confirmation, just an estimate) and therefore has a very comprehensive database of products. If it weren’t for the infestation of affiliate and pornographic spam as well as a poor overall user experience (shipping costs and stock status should be required fields in the Froogle field), Froogle could be the top shopping comparison engine and an awesome service. But I digress…the point is, by not imposing price floors (Froogle is free), Froogle has gone from the standard 5,000 feeds to somewhere around 50,000. Let’s say that 50% of those feeds are clean and provide accurate and useful information…Froogle should theoretically have a much more comprehensive database of merchants and products than Shopping.com, NexTag, and PriceGrabber.
Which brings me back to Dulance and similar shopping search engines which don’t depend on merchant feeds but rather crawl the web for merchants and associated products. These shopping engines don’t impose price floors and get paid through affiliate programs or reasonable pay per click fees. Which means that these services can move past 5,000 merchants, past 50,000 merchants, and maybe past 100,000 merchants…hitting the long tail and possibly becoming an order of magnitude better than the current field of shopping comparison engines. Yes, there are still many issues to deal with around building an incredible user experience, but hopefully you’re getting the picture.
Dulance, according to Sergei, was a 2nd generation comparison engine because of the breadth of merchant coverage. While we’re still living in a 1st generation comparison engine world, I’m a believer that services like Dulance will soon become a powerful force in e-commerce. Shopzilla recognizes this as the company is supplementing its feeds with crawled results. Shopping.com as far as I’m able to tell, doesn’t recognize this. Shopping.com has the ability to crawl a site, but it charges $750 to do so…if Shopping.com believed in becoming a 2nd generation shopping search engine and providing the best shopping search experience possible, the company would cut this fee to just south of $0.01.
I don’t know how good Dulance’s technology is, but maybe the 1st generation shopping comparison engines should call up Sergei and check out his assets.
Ok, now that I’ve made the case for 2nd generation comparison engines, critical readers should be thinking I’m crazy… “how can Brian be such an evangelist for 2nd generation shopping engines after one of the first pure-play 2nd generation comparison engine just folded?” Good question. More to come…
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Dulance – The Long Tail – What Happens When You Move Past Feeds – July 20, 2005
Where’s Dulance? – March 26, 2006