Looks like a solid agenda (even with me speaking). ;)
This link will give a $100 discount for non-members.
Thanks to Jonathan Garriss (Executive Director of PESA, CEO of Gotham City Online) for inviting me.
Become scored a big Series C. The profitable (since Oct/Nov of 2007) shopping engine raised $17.5MM from TPG Growth, an investment arm of Texas Pacific Group (TPG) with about $2.5BB under management. Taek Kwon, Operating Partner @ TPG Growth will join the Board. Taek was one of the founders of Hotwire and then worked at InterActive Corp (Citysearch) for 6 years before briefly becoming the CEO of Friendster. Here’s the press release.
Become previously raised $7.2MM in its Series B from TransCosmos and $4.5MM in its Series A from its founders plus a couple Angels (Ron Conway). That puts the total funding raised at just over $29MM. TransCosmos did not participate in this round of financing.
So what does Become do with the fresh infusion of cash? Well the obvious answer is grow the business and take on the big boys – NexTag, Shopping.com, Shopzilla, PriceGrabber, Google Product Search, and Yahoo! Shopping.
I spoke with Michael Yang, CEO of Become, about the funding. He wasn’t as open as he usually is, so here are just a couple snipets:
Why TPG Growth? I know of them as a PE firm…
“TPG has a lot of expertise in retail and technology. They have invested in Travelocity, Neiman Marcus, and Petco so they understand the opportunities available in online retail. Also, they had the right global footprint.”
What will the money be used for?
“We’re not announcing some of the new business initiatives that we’re looking at. We’re going to strengthen our core comparison shopping business as well as our core search technology to go into new verticals. We have developed powerful capabilities using our search engine. We’re also going to invest in our SEM platform.”
It’s a crowded market. Why did TPG Growth invest?
“TPG saw strong core technology as part of the DNA. Our core search tech allows us to crawl the web – over 5BB pages – we not only offer comparison shopping, but research on the best products to purchase. We’re also leveraging our core search technology in SEM efforts. We have a powerful SEM platform – we have an enormous volume of information about products on the web.” [This can be used for keyword generation, automated bidding, global optimization – we look at our SEM campaign on a portfolio level.]
“Another thing that TPG Growth saw is that comparison shopping is still a huge opportunity. The market is still growing at 30%/yr.”
You sold MySimon to CNET for $700MM. What’s different now?
“There’s a lot more opportunity in the core product – search algorithm opportunities that better match results to search queries, better user experience and better monetization opportunities. There are also a lot more ways to access the traffic, like syndication partnerships. Our partnership with WashingtonPost.com is a good example. Comparison shopping engines today are so much better: the search algorithm, better user generated content, more user generated content, better content from the merchants, social shopping (we introduced shopping lists). Comparison shopping engines have become a lot better than they were 10yrs ago, but it’s still early.”
So what’s the exit? Google, Yahoo! and IAC all own shopping engines…
“Our goal is to build a great business that’s built to last and become one of the top shopping engines. The exit will take care of itself – whether it’s an IPO or a partnership.”
So here’s my read:
-It’s really tough being an under-capitalized business, so it makes sense to raise $17.5MM…especially with the current market condition
-After paring back a bit in terms of headcount, I’d expect Become to bulk up again
-Become will get a lot more aggressive in terms of PPC buying
-Become will get a lot more aggressive in terms of partnerships
-While Michael says Become will move into other verticals, I think its main focus and core money-maker will be comparison shopping for a long time. Become tried being something other than a comparison shopping engine for a while (pushing it’s crawled listings of product reviews and buying guides), but it took a focus on comparison shopping to become profitable.
-With this money, Become can afford to get sidestracked a bit, but not too much. I’d expect Become to go into related verticals that some of the other shopping engines are participating in. Think Lead gen services like local, online education, travel, and lending.
-The exit is going to be tough. Google, Yahoo, and IAC all own shopping engines. That leaves Microsoft, but obviously Microsoft is going to have its hands full for a while.
If you’re a lead gen guru, there’s finally a conference for you!
No, I don’t get a cut if you register.
It’s always great to see merchants blogging about their internet marketing experiences. I’ve mentioned Preston Wily’s blog before, and I’d like to introduce you to John Middleton’s blog, which has been added to the ComparisonEngines.com Blogroll. John doesn’t list an ‘about us’ section on his site, so I’ll leave it up to him to decide if he wants to share his bio/company information (John, you can post a comment below), but his tag line states: ‘Read as John learns about what it means to be a web analyst for a small company in Portland, Oregon.’ John has been focusing on the shopping engines, but I’m sure there’s more to come.
New Google Base Resource
Tom the Developer, a frequent contributor to the Google Base Help Discussion Group, has launched a great little app using the Google Base API. The competitor analysis tool allows you to see the attributes being submitted for each listing. GREAT resource for anyone doing Google Product Search focused data feed optimization (DFO) (yes, that’s a link to SingleFeed b/c that’s what we do!).
While Shopping.com (SDC) execs blatantly denied my claims that there were any problems on their end going into the holiday shopping season of 2007, it seems that the company has since modified it’s position.
First, Josh Silverman, SDC’s outgoing CEO said in the February Merchant Support Newsletter, “As our traffic increased in the past quarter, it placed some unexpected strains on our systems.” That’s a far cry from what I was told when SDC cut off new advertisers.
And now after taking down the Merchant Account Center (MAC) 2 times for a total of 14hrs in the last week (according to the notifications), SDC has launched a public Help Center.
The full announcement is here. This is an excerpt:
Previously, our help tab was integrated into the Merchant Account Center and only provided access to solutions in our database. Now, you can search the knowledge Base as well as interact with other merchants under our supervision in our new Beta Merchant Support Forums! There, you can post optimization information, bidding statistics or tips, discuss your marketplace, or troubleshoot a technical issue in a public space so others can take advantage of your experience.
We’ve also changed the process of how to submit a case. All cases will be submitted through the knowledge base page. Additionally, once you detail your issue, keywords in your inquiry’s subject and body will be used to find solutions related to your issue in case you couldn’t manually find what you were looking for! With this feature, our Account Managers hope to provide you faster, more detailed responses to questions about your performance rather than focusing on How-To’s or other technical issues.
With this announcement, we are pleased to redefine our services to you as well as decrease our current advertised response time from 7 days to 3!
It’s nice to see Shopping.com making the effort to help it’s merchants. The Help Center is public and can be accessed here.
Seems that Shopping.com is now making use of SalesForce’s web-to-case management system which allows merchants to log their own cases, get suggested solutions, and have the cases be routed directly to an account manager. Coincidentally, SingleFeed is implementing the exact same system this week, although I’d say the parallels end there.
My #1 suggested resolution for the shopping engines for 2008 was to provide more transparency. While I meant this in a number of ways (and left it open to interpretation), one way was to open up a bit and tell merchants what’s going on. At SingleFeed we screw up every once in a while, but our account managers are transparent about the process. That openness doesn’t solve everything, but it goes a long way in building trust.
Shopping.com is going the right direction with this Help Center. I was shocked (in a good way) to see that they had opened up public forums. While the threads will be under ‘[SDC’s] supervision’, the initial
three posts have been negative and SDC hasn’t removed them:
“I am being charged hundreds of dollars per month although the product has been removed a while ago!!! Please look into this matter and provide contact informations! This is an urgent matter.”
“We too are being billed for products that have been removed OVER 5 months ago. I contacted support before this new support area was setup with no resolution.
Our frustration of not getting any support on this matter is also likely to drive us to abandon Shopping.com as well.”
I’ve been pulling my hair out for 3 days now trying to get my products to map properly and it is IMPOSSIBLE to get any help. No contact email or phone number. I’m ready to pull the account.
So far, so good. Look forward to see more of these improvements.
Well, there’s some debate about when the first transaction actually took place as well as the actual definition of ecommerce, but the article by The E-Commerce Times gives a nice look back at a potential first online sale, an IBM PC for $7,000, which took place on March 4, 1983.
13 years ago, I worked at CUC International (later Cendant, and no, I wasn’t involved with the accounting scandal). I thought CUC acquired the first real ecommerce site on the web when they acquired a company called NetMarket which was run by Roger Lee.
Anyways, ecommerce is now a $200BB industry which will grow to $300BB in three years, according to Forrester.
As TechCrunch reported earlier today, Google is testing secondary search boxes for top retailers like Amazon, Borders, BestBuy, and OfficeMax. While I couldn’t get the searches to work properly, if you search in the Amazon search box (see screenshot below), Google will keep you on Google.com, display the normal AdWords listings, and display Amazon’s content in place of Google’s normal organic results. Also important to note, at least in my searches using the Amazon box, Google highlights its own Shopping search results through its universal search link for Shopping (see screenshot below).
I could only get the Amazon, OfficeMax, etc. search boxes to come up in IE.
Amazon search box on Google:
Results page – Searched for ‘red sweater’ – the Amazon ‘organic’ listings are at the bottom of the page as something is wrong with the UI (see next screenshot). The important thing to note is the use of Google’s own Shopping link and those ever present AdWords listings:
Obviously Amazon’s ‘organic’ listings are supposed to be displayed as Google’s organic listings usually are displayed, but the UI seems to be off: