Rise of the Comparison Shopping Engines

Hailed by many as a gigantic step forward in online shopping, Comparison Shopping Engines (CSE’s) have come to dominate the way many people shop online, whether they realize it or not. But has this shift been a good thing for the shopper? What about the smaller retailers, many of whom were the forward-thinking early adopters of eCommerce? We feel that for the most part, it has not.

The trend in fact has quickly mimicked what has taken place in the “real world” or retail over recent decades. The small local retailers have suffered, many having died off at this point, at the hands of large retail chains that come in to small towns and communities offering large selections and discount prices. Good for the consumer, right? It may have seemed like it at first, but as the small retailers started going away there were two very negative reverse trends. Prices stabilized (went back up) and the niche items, those ones you could only find at the small shop on the corner, were nowhere to be found.

But the Internet fixed all that didn’t it? Suddenly anyone, regardless of their location could start up a website and sell their products. The small guy was once again in control of his (or her) own destiny! Borders and boundaries were shattered. Those niche items that you thought were lost to you for all time were once again available by doing a little searching online.

But then it happened. The larger companies with vast supply-chains and deep pockets saw what the smaller entrepreneurs already knew intuitively. “There’s gold in them thar hills!”

Suddenly there was massive competition in just about every category. Books, Music, Clothing, Crafts, Household Goods, Furniture, Groceries, Wine, you name it. With the rise of the SCE’s (yes we’re back to them now) the game got even more cut-throat. Prior to the CSE’s most retailers regardless of size were still playing on a fairly level field. If they could get you to their website and sell you on their Unique Selling Proposition (boring meeting speak for “what makes us special”) whether that be price, free delivery, excellent service, product guarantees, coupons, whatever, then they had a chance at the sale.

The CSE’s cut all of that out. It no longer meant anything to have great service, a great site layout, or the perfect unique item. The shoppers were now being corralled through the CSE’s with the promise of the “best price”. Regardless what search engine or portal you started from, if you clicked on a link or button that said “shopping”, you were getting results from a CSE. Even Amazon (the proverbial 800 pound gorilla) saw the writing on the wall and adopted a CSE mentality by letting anyone who wanted to sell through their site. How did you find their product? You searched, product was found, and the best price was put forward. If Amazon didn’t get the sale directly, at least they were getting a percentage.

Now I’ll make a few concessions to what I’ve said so far. The CSE’s have gotten better (not great, just better) at comparing retailers by more than just price. They have started to incorporate shipping costs to get a truer comparison. They’ve also implemented rating systems on the retailers themselves to help the “good retailers” rise from the fray. But unless a smaller retailer has the money to throw at the CSE’s, they have a MUCH smaller chance of ever getting noticed in the first place.

As an exception to the damage done by CSE’s, there’s also the fact that the “big name” retailers of the real world have finally gotten past their fears of the Internet and have started selling under their own names. There were a few early adopters, but for the most part they stayed on the sidelines for about the first decade of the eCommerce revolution. They have brand recognition and loyal shoppers who will shop with them first. They also have logistics and warehousing infrastructure that the purely online retailers lack.

Yes there are plenty of commodity goods that shoppers can find at Amazon or through the CSE’s and they’ll get a great discount price (or maybe not after shipping and other fees are added). But when a unique shopping experience is desired, where does that leave the shopper? Where does it leave the small retailer who has the hard to find products you want? In an uphill battle to get what they really want… each other.

There are some truly great eCommerce sites out there that practically no one knows about. There are also great products out there (even at the larger retail sites) that are rarely found.

It will be the goal of AardvarkAvenue to bring those stores and those items to your attention in the coming years. Along the way, we also hope to offer you online shopping advice and tips on how to shop wisely regarding your private information.

Come back soon.

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