Haven’t seen the ad(s) yet, but Shopzilla/Scripps got a bunch of press touting the commercial(s).

Scripps (owner of Shopzilla) has taken a beating recently as the company claims click costs are too much for Shopzilla to handle. Scripps has therefore said it would concentrate on brand building and driving free traffic. One strategy seems to be link building. And I mean a TON of link building.

For those of you who aren’t familiar with search engine optimization (SEO), one factor that goes into rankings on Google and Yahoo! is the number and quality of inbound links. If your site has a lot of links from high quality (traffic, relevance) sites, that’s good. Not a lot of links, not so good.

Well, seems that Scripps has discovered this SEO tactic and has put links to Shopzilla, BizRate, and uSwitch on most of its media properties. Here are some examples:

From Redding.com:

From Newsnet5.com:

So this is what they mean by free traffic.

You can find these links on most of Scripps’ newspaper (20 listed on this page) and broadcast television (10 listed on this page) sites. These links are in addition to the various modules of Shopzilla content that were already in place on most Scripps properties.

Very smart move on the surface. Whether there should be some sort of disclosure that Scripps is the parent company of both the newspaper/tv station + Shopzilla is not really bugging me.

What does make me a little uncomfortable, though, is the lack of relevance and value to the average Joe reading a newspaper site like Boulder’s Daily Camera.

After reading Looking for the warning signs in kids, do parents really need to ‘Comparison Shop for Digital Cameras and Appliances at Shopzilla& BizRate’?

Highlights from the press release:

“Revenue at the company’s interactive media division, including Internet search businesses Shopzilla and uSwitch, rose during the first quarter of 2007, but segment profit for the division was down because of changing business conditions, strategic investments the company is making to improve the consumer experience and competitive position at both businesses, and costs related to a transition in leadership at Shopzilla. On a pro forma basis, as if the company had owned uSwitch since Jan. 1, 2006, Scripps Interactive Media revenue was down 8.7 percent during the quarter.”

“Interactive Media revenue was $62.9 million for the first quarter compared with $58.6 million in the first quarter 2006. On a pro forma basis, as if the company had owned uSwitch for the full year 2006, Scripps Interactive Media revenue was down 8.7 percent. The segment loss at Interactive Media was $400,000 compared with $13.9 million in segment profit in the first quarter 2006. Costs related to the leadership transition at Shopzilla reduced segment profit by about $5 million. The company also invested $10 million during the quarter to build brand awareness for uSwitch in the U.K.”

“Scripps Interactive Media, which includes Shopzilla and uSwitch, is expected to generate segment profit of about $5 million in the second quarter. The company’s outlook for the second quarter and balance of the year assumes no improvement in market conditions experienced by both businesses in the first quarter. For the full year, interactive media segment profit is expected to be between $30 million and $40 million.”

The bigger they are the harder they fall?
–Q4 2006 Earnings Call
–Q2 2006 Earnings
–Q1 2006 Earnings
–A look at 2005

I’ve been thinking about this post for a couple days, and I’ll add more in a separate post soon, but considering that the news just hit the wires, I wanted to let you know that Farhad Mohit and John Phelps have announced that they are leaving Shopzilla.

Here’s the press release announcing the departures and the naming of Bill Glass as the new president.

PS. Thanks to everyone who broke the news to me over the last week…just didn’t want to post anything prior to the official release.

Update: Sorry about the disappearing post. Ran into problems with Flickr so went over to Photobucket, but that ended up messing up the WP formatting…went back to Flickr.

Shopzilla is the only shopping comparison engine to truly take advantage of email newsletters. Must be an incredible $$$ maker for Shopzilla.

Impressive that they put this together less than 24hrs after the Golden Globe awards were announced.

Just in case you thought I was picking on Shopping.com the other day, I also took a closer look at Shopzilla’s numbers through Scripps’ earnings call.

Q2 2005 revenue of $29.5 million and earnings of $7.6 million.
Q3 2005 revenue of $32.5 $35.2 million and earnings of $7.3 million.

I like the 19% increase in revenue, but why did earnings decrease 4% quarter to quarter? As Shopzilla is now part of a larger entity, I didn’t get the kind of answer I was looking for.

According to Farhad Mohit, Founder and Chief Product Officer, “at this stage in the game where gaining marketshare is most important, we are very very pleased with the topline revenue growth that we are experiencing and take that as a sign that we are helping more and more consumers and sending an increasing number of quality leads to our retail partners.”

WSJ Article – “Shopzilla’s revenue more than doubled over year ago-levels, to $35.2 million, and its segment profit jumped to $7.3 million from $1.2 million a year earlier.”

MarketWatch – “Revenue [for Scripps] rose 19% to $595 million, bolstered by continued growth Scripps’ cable networks and Shopzilla, the online comparison shopping service it acquired in June. Excluding Shopzilla, revenue rose 15%.”

AP – “Shopzilla’s revenue more than doubled year-over-year and profit increased about six-fold, Scripps’ CEO Kenneth Lowe said. The number of unique visitors to Shopzilla also was up sharply during the quarter. The deal to purchase Shopzilla in June initially raised concern among some investors worried over intense competition in online comparison shopping. But Lowe said at the time that the 126-year-old company has prospered by embracing each new era in media technology.”

Official EW Scripps Release – “At Shopzilla, we’re seeing plenty of evidence that a rapidly growing number of online shoppers are discovering the utility of this very powerful, online product search and price comparison service.”

I went through account setup & feed submission for a number of comparison engines today. In all cases, I uploaded my feed through the account center interface. Here are a couple notes for Shopping.com and Shopzilla…

Shopping.com: Kudos on accepting Excel files rather than just .txt files (I know this is a minor point, but every little thing makes a difference). A note of advice… send out a welcome email to all new merchants. Maybe this only happens when my products go live, but when every other shopping comparison engine sends out a welcome email immediately, not having one from you is a little disconcerting. Also, once I set up the account and submitted my feed, the Merchant Account Center (MAC) said: “Not Live – Registration Complete”. How about explaining what that means…I assume it means that you’re reveiwing my account before making it live, but who knows? Finally, this could just be an error with the MAC (which I know is in BETA), but once I logged out of my new account, I couldn’t log in again…and because I didn’t get that welcome email from you, I now have no way to contact you.
Read the rest of this entry »

From the press release:

John Phelps, currently chief operating officer of Shopzilla, has been named president of the online comparison shopping service, which is the newest operating subsidiary of The E.W. Scripps Company.

Phelps succeeds Chuck Davis, who has been named chairman of Shopzilla. Davis, 45, was president and chief executive officer of Shopzilla when it was acquired by Scripps in June. He will serve in an advisory role and also will work with Scripps to explore business opportunities in rapidly growing interactive marketplaces.

Read the full release.

Shopzilla’s second quarter 2005 EBITDA of $7.6MM on revenue of $29.5MM highlights the strong growth of shopping comparison engines and puts the company ahead of Shopping.com in terms of quarterly revenue. Shopping.com reported second quarter 2005 revenue of $27.8MM, $1.7MM less than Shopzilla.

As Chuck Davis, Shopzilla’s CEO points out, the company has been “growing sequentially, quarter-over-quarter, since the holidays. In a seasonal business like shopping, which normally skews heavily to the fourth quarter, this trend is quite exciting.” According to Farhad Mohit, the company’s fourth quarter 2004 revenues were $25.1MM and first quarter 2005 revenues were $26.9MM (as the company was a private corporation until the recent E.W.Scripps acquisition, there is no way to confirm these numbers). While Shopping.com’s fourth quarter 2004 revenues of $31.7MM and first quarter 2005 revenues of $28.9MM were higher than those reported by Shopzilla, it’s important to note that Shopping.com has seen a sequential, quarter-over-quarter downward trend in revenues since the fourth quarter. In truth, this is what should be expected with a shopping related site. That’s what makes Shopzilla’s strong growth even more interesting.

Here’s a closer look at what makes Shopzilla tick. I sat down with Farhad Mohit in his company’s LA office a couple weeks ago to get an overview of the company. I will follow up with Farhad in the near future to more thoroughly hit on some of the subjects covered in our conversation… Read the rest of this entry »