Jellyfish – The Good, Bad, and The Ugly


The Good
-Jellyfish launched with an effective PR campaign which created much fanfare and mainly positive reviews for it’s ad model.
-As opposed to merchants advertising through a PPC system (which is the standard on the shopping comparison engines), merchants pay Jellyfish a referral fee, more than 50% of which is passed onto the consumer as a cash back offering.
-Merchants can specify referral fee (or CPA) by product. Stop for a second and think about that. This is a no-risk advertising program at the product level (not category level).
-Search results on Jellyfish are listed according to ‘bottomline’ price which is the price of the product less the cash back amount the consumer receives. There is no PPC bidding for higher placement which makes the results a lot more transparent for everyone involved.
-Jellyfish is not doing any PPC buys on Google Adwords or Yahoo! Search Marketing (YSM) and therefore is not driving up costs for merchants on those engines.
-Jellyfish looks clean, simple, and smart through its use of Ruby on Rails. The older shopping comparison engines truly look old in comparison.
-I believe Jellyfish has the potential to create a liquid online market where merchants are duking it out for consumer attention. Again. Stop and think about that. As opposed to just bidding more on Shopzilla or Shopping.com to move up in ranking, on Jellyfish, the merchants are throwing money at the consumers.

The Bad
-Through some momentary lapse in reality, a number of people who covered the Jellyfish launch seem to have hit their heads (and probably other parts of their bodies) extremely hard, resulting in obtuse statements equating Jellyfish’s ad model to the creation of sliced bread. I might be to blame for some of the hype, but if you read what I wrote before Jellyfish’s launch, I never said this is a revolutionary model:

I talked with Brian and Mark to get a couple more specifics. Jellyfish wants to empower the consumer and to do this had to build a new ad model. Well, I don’t think it’s completely new but it’s a refreshing change from the status quo.

The status quo being PPC. But remeber, SNAP has been doing CPA based advertising for a while and most lead gen services are based on a CPA model. And then there’s the whole cash back and loyalty program world that has been providing consumers with incredible deals for registering, logging in, and using their links to purchase. eBates and MyPoints must be scratching their heads at all the hype.
-Jellyfish launched its beta a little too soon as its search engine needs a lot of work and the total number of stores in its system (and therefore the total number of products) is quite limited. Yes, Jellyfish is in beta, but I think its a mistake to launch a site these days when the digital camera listings for a ‘canon digital camera’ search show up below the fold or when you have less than 10 merchants selling an iPod Nano or when…ok, they are in beta, I’ll be nice. In the end, I’m all for releasing often and early, but the core functionality has to be there. The core functionality for Jellyfish is the fluid CPA ad model on top of shopping comparison engine listings, not just the fluid CPA ad model. At the very least, they could have back-filled with Shopping.com results or talked to Shopwiki about licensing their technology.
-Because Jellyfish is working off of mostly CJ listings, they do not have shipping and tax information on the site. This has become standard. Jellyfish needs to incorporate this data. Otherwise they potentially run into the Froogle and eBay problem where merchants list a low product price but then charge an outrageous shipping fee.


The Ugly
The Good, The Bad, and The Ugly is one of the best ‘spaghetti westerns’ ever made. It’s the movie that MADE Clint Eastwood a star. So ‘The Ugly’ isn’t so ugly. Jellyfish has potential. They have blended a shopping comparison engine with a cash back/loyalty site. Smart, but they are going to have to back up their bark with a big bite. Shopping.com launched and shut down a loyalty program last year. Bizrate did the same thing back in 2001. Granted these concepts aren’t the same as Jellyfish’s fluid CPA ad model, but they are variations on a theme.

I think Brian and Mark are smart guys who are in this for the long haul. I think online shopping will change so much in the next couple years that there’s plenty of room for new players.

Does Jellyfish have the potential to be more than a niche player? Probably not. But a niche these days can do $2m/month in revenue. That’s not bad.

Jellyfish can pre-populate with all the Commission Junction (CJ) merchants, but signing direct deals with new merchants when you’re the 10th shopping comparison engine on the block is a challenge. When I started using PPC engines back in the day, I worked with YSM, Google Adwords, FindWhat, IndustryBrains, Ah-ha, etc. I quickly realized that my time was better spent optimizing YSM and Google Adwords than worrying about the little guys who couldn’t drive much traffic. The same thing already happens with shopping comparison engines.

And if they’re not using the PPC engines, how are they going to market?

I received a number of emails last week in which people completely dismissed Jellyfish. I don’t think Jellyfish is going to kill off Shopping.com, PriceGrabber, or Smarter.com, but please take a second look at the ad model. There’s more to the world than just PPC.

Related Posts:
-Guest Commentary by Harrison Zanuck – Jellyfish: Cash Back Shopping for the Masses – June 28, 2006
-Startup Primed To Challenge Google CPC Ad Model – June 26, 2006
-Jellyfish PR, Search Engine Lowdown, Media Guerilla – June 23, 2006
-Mpire – Transparency & Empowerment – June 11, 2006
-A Case for Product Level Bidding – June 5, 2006
-Next Generation Shopping Comparison Engine – October 3, 2005

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4 Responses to Jellyfish – The Good, Bad, and The Ugly

  1. Curtis Thompson says:

    Brian,

    I love the blog and have been a voracious reader for the past 90 days or so. I voted for you on MarketingSherpa but had a lot of problems as you know. Those guys are great, but that was a bit of a shambles. I am interested to speak to you in some more detail when timing is right. I am working on a comparison network (who isn’t right) that I think is defensible. I like Jellyfish’s idea, but I find that pricing model’s are always the easiest to copy and therefore the hardest to defend. In addition, I’m not sure how this is any different than Yub.com. Not saying that their isn’t room on the web for more than one site with the same model, just that there doesn’t seem to be anything too revolutionary here, and in the spirit of 4th of July thought the timing of a post on revolution or lack thereof was right.

    Curtis

  2. […] McGuire that I would do an updated post. But Brian Smith of Comparison Engines has done an elaborate and thoughtful post on Jellyfish. So I’ll point […]

  3. […] g an LCD TV), and I am guessing not too much marketing spend (company is VC funded). More coverage of Jellyfish from Brian-the-master-of-comparison-engines […]

  4. […] – It’s All About The Smack – September 9, 2007 -Hearst Buys Kaboodle – August 8, 2007 -Jellyfish – The Good, Bad, and The Ugly – July 2, 2006 If you liked that post, then try these…Yahoo! Celebrates Halloween on October […]

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