Comparison Shopping Engine Strategies

Condition Value Displaying on Google Product Search Result and Product Pages

Condition value is displaying both on results pages and product pages for some Google Product Search users. This is not too surprising considering Google recently made the condition attribute a required value.

The condition, or conditions in the case of product pages containing offers of more than one condition, appears next to the product price. In addition, a "New items" check box that filters out non-new products from the result set appears at the top of the results next to the checkout and free shipping check box filters.  On the product pages themselves, a condition column is visible as well as a similar check box filter for new items.

This is great news for consumers in terms of usability. It's frustrating as a consumer to see a great price on a laptop only to click through and find it is not the new computer you were hoping to buy. I think it is likely that older computer and consumer electronics products will start to fall out of high positions, rather than be artificially anchored to the top by traffic from users who don't realize they are clicking on offers are for non-new products.

Google Experimenting with Additional Product Results

**Clarification - we just heard from a Google spokesperson.  They informed us that the screenshots are actually NOT the Google Products Ads test, the experiment has not started yet.  This is some other experiment.  It will be interesting to see what the official 'Google Product Ads test' looks like.

It's always fun to stumble across a Google test. Phillip Lennsen over at Google Blogoscoped posted today about a new Product Ads feature in the Google Affiliate Network, so this may be part of the testing for that. The screen shot below shows two sets of shopping results on a standard Google SERP for "crocs mammoth." The lower shopping result set is the often seen "one box" area powered by Google Product Search feeds, but the upper set is something we haven't seen before.

The first two links go directly to Shopping.com. The last goes to Campmor but it is a Shopping.com network link. It's hard to know for sure if this is unique to Shopping.com at this time or if more searches would eventually result in content from other sites, but about a dozen queries yielded nothing but Shopping.com links. Some went to Shopping.com product pages while others went directly to the advertiser's site, including Amazon and eBay.

Several things are confusing about this. It's almost as if Google has become part of Shopping.com's partner network, but if this is in fact Product Ads testing, it's possible they just selected Shopping.com as a test partner. Either of these is a little puzzling considering past tensions between Google and eBay (Shopping.com's parent company).  Aside from the fact that Google and eBay historically don't play nice, why would Google insert a second set of product data instead of working to monetize Google Product Search? Maybe they'll replace the one box with this product set? How is this better for users than Google Product Search content? How can merchants optimize a single data feed for both Google Product Search and Google Affiliate Network considering they likely use different algorithms and may be directly competing for SERP real estate?  Curious to say the least.

I'm also not sure what impact this will have on merchant's Shopping.com experience in the short term. If this continues/expands, traffic could ramp up significantly. Google Product Search conversion rates are generally good, so hopefully that would carry over to the direct links to retail sites, but I wonder how users will react to going from Google results (at the very top of the page in some cases) to Shopping.com, and then through to the merchant (or not).

Some of the links we found go to a page where we have a tracked item live so we'll keep an eye out to see if traffic changes significantly for those items.

Some other screen shots (a little grainy unfortunately):

Ciao US Goes the Way of MSN Shopping

Microsoft announced today that Ciao in the US will cease to exist as of July 1. Feeds will no longer be processed and the Ciao.com domain will redirect to Bing Shopping.

This pretty much ties up to the MSN consolidation in the US. Ciao will no doubt continue to exist in Europe. The real question is if and how they will more formally integrate Ciao with Bing in Europe. Right now it just redirects from Bing to Ciao, which is a little confusing from the user perspective, but maintains the SEO advantage of the already popular sites and leaves intact the social aspect of Ciao as well. I imagine the Ciao US social network never grew significantly, but the European network is probably pretty substantial, so Microsoft won't want to lose that aspect. We often see for sites with more of a social focus such as Ciao that the unique visitor numbers, and therefore impressions, are significantly raised, even if click-throughs to merchants are relatively lower. This suggests a higher revenue opportunity from display advertising, which makes one wonder why display ads on Ciao are scarce.

CSE Strategies and Internet Retailer Conference and Exhibition (IRCE)

CSE Strategies readers - today kicks off the annual retailer confab - IRCE in Boston.  We'll be there in force and it is certainly a big year for comparison shopping engines so there will be lots to see and learn on all topics CSE.

We've put together this handy CSE Strategies guide to IRCE here so you can optimize your IRCE time and learn as much as possible.  ChannelAdvisor will be in booth 749 and there are 10+ engines that will be present.  Any of our representatives will be able to discuss all of the changes coming up with CSEs and how our software can help you manage CSEs.

If you want to meet at the show, shoot me an email or tweet, or stop by the booth.  CSE Strategies readers will get a free smoothie - so mention you are a reader at the booth for a cool (literally) treat.

As a value added service, we've provided two handy cheat sheets so you can do the 'CSE Strategies' tour of the show floor. The first is Alpha by company the second is by booth.

Alphabetical CSE Strategies Guide to IRCE

Company	Booth	Comments
Become.com	244	CSE 2.0 engine - seeing some good growth
Bing.com	813	The newly rebranded Live.com, MSN shopping, Live shopping, Live Cashback and all of that.
ChannelAdvisor	749	Best software available to manage CSEs - bar none.
Google	707	Small search engine company with something called Google Product Search or Google Shopping (aka froogle)
Pronto	849	Division of IAC with rapidly growing CSE that has some great social elements
Shop.com	845	Shared cart CSE that has opened up to non-cart folks recently.
Sortprice	1253	Newer CSE - lots of breadth.
TheFind	422	Newer CSE - focused on breadth.
ValueClick	952	Smarter.com and pricerunner.com
Winbuyer.com	349	Put a mini CSE right on your ecommerce site so buyers can price shop without leaving - like progressive insurance for ecommerce
Yahoo!	449	Mostly pushing their store offering, but sure to have some Y! Shopping folks there too.

By Booth Number - click here for a map of the exhibit hall.

Booth	Company	Comments
244	Become.com	CSE 2.0 engine - seeing some good growth
349	WinBuyer.com	Put a mini CSE right on your ecommerce site so buyers can price shop without leaving - like progressive insurance for ecommerce
422	TheFind.com	Newer CSE - focused on breadth.
449	Yahoo!	Mostly pushing their store offering, but sure to have some Y! Shopping folks there too.
707	Google	Small search engine company with something called Google Product Search or Google Shopping (aka Froogle)
749	ChannelAdvisor	Best software available to manage CSEs - bar none.
813	Bing	The newly rebranded Live.com, MSN shopping, Live shopping, Live Cashback and all of that.
845	Shop.com	Shared cart CSE that has opened up to non-cart folks recently.
849	Pronto	Division of IAC with rapidly growing CSE that has some great social elements
952	ValueClick	Smarter.com and pricerunner.com
1253	Sortprice.com	Newer CSE - focused on breadth.

Google Product Search Announcement About Attribute Changes

 Google announced today that the condition attribute will soon be required. Valid values are new, used, or refurbished. This is definitely good news in that it suggests they will soon either display this information or filter on it. Such a change would positively impact the user experience on Google Product Search since right now, consumers don't know the condition of the item until after they click through. I've bought many refurbished items in the past, but as a consumer, it is definitely nice to be able to clearly see condition as early as possible so you don't click on a refurbished or used item when you definitely want new.

In addition to their blog post, Google emailed merchants today with the condition attribute news,  a recommendation to use their most recent taxonomy in the product type attribute, and announcement of a new attribute, "compatible_with." This new attribute is specifically targeted at merchants in accessory categories such as ink cartridges or cell phone accessories to give them a structured way in which to communicate the core product models with which their items are compatible.

Full email below:

Hello,

We'd like to let you know about an important change we're making to the Product Search data feed requirements. As you know, you can help shoppers find your products by including high quality, frequently updated product information in the form of attributes.  In order to provide shoppers with the most useful information, we'll be making the "condition" attribute required starting on June 30th, 2009. 

In order to keep your feeds active past this date, please remember to include the "condition" attribute for all of your items if you're not already doing so.  Please include one of three values to describe your product: new, used, or refurbished.

For more information on formatting the condition attribute, please visit http://base.google.com/support/bin/answer.py?hl=en&answer=148684

In addition to making the "condition" attribute required, we've made some other changes to our attributes:

Recommended: "product type" 
The "product type" attribute allows you to specify a product category for each item. We recommend that you use our product taxonomy, however, you are welcome to use your own categories.  For more information, please visit: http://base.google.com/support/bin/answer.py?hl=en&answer=66818

New: "compatible with" 
The new "compatible with" allows you to specify what products your item is compatible with.  For instance, if you're listing an HP 74 (CB335WN) black ink cartridge, you can use this attribute to tell us that it's compatible with the HP Photosmart C4480 and HP Photosmart C4580 printers.  Using this attribute will help you avoid listing the same item multiple times with different compatibility information. For more information, please visit http://base.google.com/support/bin/answer.py?answer=73932#optional

Sincerely,

The Google Product Search Team

Amazon ProductAds Webinar on June 24th.

Amazon is hosting a free webinar on ProductAds June 24th at 1pm EDT, 10am PDT.  You can register for the Webinar here.

At ChannelAdvisor we're seeing those retailers that adopt ProductAds have it shoot to the top of their CSE list from a traffic/roi standpoint very quickly so we recommend everyone that isn't selling on Amazon today take a look at this program (which we fully support BTW).

You can register here and the blurb for the webinar follows:

Learn how to advertise your products to Amazon.com customers and drive traffic to your website. 

Product Ads is a cost-per-click advertising program that puts your products in front of millions of Amazon.com customers. Simply upload your product catalog and set your bids and budget. Amazon will display your ads in highly targeted placements. When customers are interested in buying your product they click through to your Web site and purchase directly from you.   

This webinar will give you an overview of Product Ads and show you how to optimize your ads. 

Your website must have online checkout to participate in the Product Ads program.  The program is not currently available in the Amazon categories Books, DVD, Music, Digital Downloads, Automotive, Grocery, Pet Supplies or  Industrial.  Product Ads is only available today to US businesses to advertise on Amazon.com.

MSN Bing Replaces Live Search - MSN Shopping Officially Done

Bing has landed. After much hype, MSN has replaced Live Search with Bing, its new "decision engine." The shopping component, which appears to be called Bing Shopping, is  a re-skinning of Live Search Products/Cashback. This is not too surprising since the existing interface was already pretty good and since they whole Bing change was probably enough of work without having to redesign the shopping area as well.

Much like Google did for Product Search a few years back, MSN has accentuated the product component by prominently displaying a shopping link on Bing result pages, as well as the home page. This will likely lead to increased traffic and awareness of the cashback program, especially in the early days as news outlets cover the Bing launch and curious users use their internal decision engines to evaluate if switching to Bing is worthwhile.

Meanwhile, in Europe, the Bing  Shopping links point directly to the various Ciao sites, where available. The Ciao network is sure to see a boost in visitors as well.

In addition, as expected, MSN Shopping will cease to exist as of June 30. If you are a retailer currently advertising on MSN Shopping and not cashback, now is a great time to re-evaluate your MSN strategy.

Google Changes Terms of Service for Product Search

Google actually announced two things, but the first one is critical in the short term:

1. The Google Base terms of service have changed. All merchants must log in and accept these new terms in the next 30 days, before June 26, or product listings may become inactive. I didn't see anything substantially different from the old terms, but I'm not a lawyer so you'll probably want to actually read them just to be sure. 
2. Google has added fields for general business information such as address, phone number and customer service contact info.  There is no telling how they may use this information but it is probably in every merchant's interest to complete this. If displayed, this information may help consumers feel more confident in transacting with your company. More importantly, it seems likely that Google would somehow penalize/reward merchants based on the absence/presence of this information.

Nielsen Data on CSE Unique Visitors

An article at SeekingAlpha sites both search and comparison shopping data from Nielsen for April of this year. In the search world, you may be surprised to hear that Google still owns the majority of searches. On the CSE side, there are some surprising and some not-so-surprising tidbits:

Not Surprising:

• MSN Live/Cashback is up over 600% versus last year. Apparently, giving away money makes you more popular.
• Many engines saw a decine in visits. Fewer shoppers in a bad economy, plus Google changes have hurt traffic for some engines.
• Google down year over year. That's what happens when you move the shopping link into the drop down. I noticed this week it is back in plain view on all SERPs.

Surprising:

• Shopping.com and PriceGrabber both nowhere to be found in this data. We see much more traffic and revenue from those sites than we do from Pronto, Smarter or Become, but those sites do get a lot of traffic from their affiliate networks so maybe this could go under not surprising.
• Bizrate and Shopzilla are listed separately despite being the same company using the same product data. When combined, they are second only to NexTag, which I assume was listed separately from Calibex.
• Become.com saw a decrease of 43% year over year. Since they increased their CPC rates earlier this year, it seems they would have more money to acquire more traffic, unless they lost a large number of merchants due to the increased rates. Also, we've seen an increase in traffic coming from Become.com recently, so even if their uniques have drops, perhaps their CTR has increased.

Huge Year of Change for Comparison Shopping Engines in 09.

There's more changing in the world of Comparison Shopping Engines (CSEs for short) this year than I can remember since back to the 99/00 timeframe.

The short-list:

• Amazon Product Ads are doing really well and have come out of nowhere to be a top CSE for many of our retailers.  We have more details over at sister-site Amazon Strategies.
• Biztrate (shopzilla's sister site) - has an entire new UI (details at siter-site CSE Strategies) that highlights coupons.
• Shopping.com has announced tons of new things - tiered pricing, a new feed specification and more. I bet coupons are coming (in the feed spec).
•  Microsoft/MSN/Live - MSFT has no fewer than 3-4 CSEs now and they seem to be combining them into one platform.
• PriceGrabber - Coupons and some AOL changes coming 
• AOL - Rolling out their own (used to be Pricegrabber partnership) CSE
• NextTag - lots of changes similar to above 
• Become.com - actually increasing rates (!?) 
• Smarter - feature store and logo opportunities  

  

We have a large team of business folks and engineers at ChannelAdvisor staying on top of these changes from a product perspective and they also have put the details into a white paper that you can download for free here.

BizRate US and UK Get Refreshed

Shopzilla's BizRate US and BizRate UK just got a makeover. The new design is much cleaner, with better navigation, including a tag cloud of popular searches. Though the two sites maintain a similar look and feel, there are some functional differences in that the UK homepage has no display advertising and a box focused on product brands. The US site, which still maintains a few spaces for display ads, also includes a geography based promo area that shows top categories in some major metro regions.

Despite Shopzilla being established as the network brand several years ago, the Bizrate sites continue to attract more visitors in both the US and UK than the Shopzilla sites themselves, so it will be interesting to see how these updates impact traffic and conversion.

Welcome a new blog to the ChannelAdvisor family...Amazon Strategies!

Hey everyone - Scot Wingo here.  I'm excited to announce CSE Strategies readers know that we've added a new sister blog to our family - Amazon Strategies.  We'll be covering selling on Amazon, which we think of as a marketplace @ CA, in detail.

I mention this on the CSE strategies blog because we will be covering something we're getting pretty excited about at Amazon that is really more a CSE than a marketplace - ProductAds.  We'll be sure to cross-post those topics here so you don't miss them in the first 30 days, but after that you're on your own, so be sure to subscribe to that feed if you are interested in all things Amazon.

So to recap the various areas you can read ChannelAdvisor's thoughts on ecommerce channels:

• eBay Strategies - News, analysis and strategies for optimizing your sales on eBay.
• Amazon Strategies - Our newest blog, focused on advanced amazon strategies for ProMerchant, ProductAds, FBA, CBA, etc.
• CSE Strategies - Everything related to Comparison Shopping Engines.  There's more coming in 2009 for CSEs than any time I've seen in the last year - stay tuned here.
• SearchMarketing.com - We have a team of paid-search geniuses at ChannelAdvisor that spend day and night optimizing search marketing campaigns for hundreds of top retailers.
• Blog.channeladvisor.com - Product-related thoughts from some of our top engineers, product managers and services folks at ChannelAdvisor.
• Strategy and Support Center  - For our customers, we provide even more in-depth strategy and channel details in the SSC (new beta is out check it out!)   

Oh yeah - almost forgot - we're kicking off Amazon Strategies with a post that is intented to answer the FAQ we keep getting: How big is Amazon Prime?   You can go direct to that post here.

Shopping.com Introduces Tiered CPC Pricing and Variable Logo Rates

Making good on their February promises, Shopping.com announced via email this evening price changes that will take effect this Friday, May 15. The announcement consists of three parts:

1. Tiered CPC Rates

• What is it?  Shopping.com has broken down every category into at least two product price tiers (a handful will have three). For example, the clothing category has three tiers/rates: Products priced under $25 ($0.10 CPC), $25 - under $50 ($0.20 CPC), and $50+ ($0.35 CPC).
• What does it mean?  Merchants with lower priced products who either decided against Shopping.com in the past or are currently filtering those products from their Shopping.com feed need to take another look. Lower CPCs equate to less risk. For a $20 clothing item, if your break even at the current $0.20 rate is at a 2% conversion rate, you can now tolerate a lower conversion rate of 1%, meaning you can incur twice as many clicks before an order is placed. This is a potential game changer for merchants who operate at the lower end of the price range.  The opposite is true for clothing sellers with an average order value all/most products priced above $50. Your rates just went up. The ultimate impact to those merchants will depend on their existing efficiency on Shopping.com (which in recent months has been at the high end of the efficiency scale). It will be interesting to see if this tiered approach creates a "selection vacuum" at the low end of each tier. If a $52 clothing item was successful at$0.20 CPC, it may very well not be at $0.35 (a 75% increase in CPC), so it's possible that products at the lower end of each tier will disappear quickly, especially in the highest tier of the three tiered categories. This reminds me a lot of what happens at the price break points in the eBay world. Since eBay (Shopping.com's parent company) tiers auction insertion fees by starting price, many merchants find it beneficial to drop the price of their items by a few dollars to get under the price break. Similarly, depending on other metrics associated with the item, it might make sense to drop the price of a $50 item to $49.99 on one's website to get the 15 cent lower CPC, even though effects all sales and not just those originating at Shopping.com.

2. Variable Logo Rates:

• What is it?  Many engines charge a flat rate for merchant logos to appear. This simply changes that pricing structure, allowing the current CPC rate on the item to determine the logo charge. So if you are selling a $20 clothing item (CPC of $0.10), the logo charge is 2 cents per click, but for the $30 item (CPC of $0.20) the logo charge is 5 cents per click.
• What does it mean?  Again, this favors those selling lower priced items, but there is no bad news for anyone. Since the CPC rate is now based not just on product type (category), but also on product price, the increased efficiency needed to justify the logo cost just got much more realistic at the low end. When considering displaying a CSE logo or any other add-on feature, the simplest way to understand the risk is to compare the cost of the add-on to your current CPC and understand that your conversion rate needs to increase by that same amount for you to break even, assuming your average order value does not change. So if your CPC is $0.30 and the add-on is $0.10 (a 33% increase in cost), your conversion rate needs to increase by 33% as well. Depending on the strength of your brand, this may or may not be realistic (it is possible the AOV could change as well but over time, this tends to stay fairly flat).  It's clear that the folks at Shopping.com thought this through and are trying to make the logo more attractive to merchants of lower CPC products/categories by significantly decreasing the ratio of logo cost to current CPC.

3. International Click Filtering:

• What is it?  Shopping.com will no longer charge US based merchants for clicks coming from outside the US or Canada.
• What does it mean? This one is great news for all merchants. Since many US merchants won't ship products to the places where these clicks originate, they represent nothing but bad traffic. Eliminating these clicks/cost from merchant invoices can only help. I'm sure some merchants who want to attract international buyers may question this, but note that this does not prevent international shoppers from clicking, it just stops you from having to pay for those clicks.

Overall, this is very exciting news from Shopping.com. It will likely increase the breadth of their product catalog, mostly at the lower end of the price spectrum, and will probably increase adoption of the logo feature. More than that, this significant change is a further indication that the often stagnant comparison shopping industry is progressing. 

Full announcement below:

Shopping.com is excited to announce 2 new pricing programs, beginning May 15th, that will enable you to add low priced inventory and advertise your brand to millions. This is another step to sustain your cost of sales and profitability.
1.    Introducing Tiered CPC Pricing

We are introducing a tiered pricing model where the CPC rates will be based on the product price in all categories.

This innovative pricing model enables you to advertise low priced items and match consumer demand, while maintaining profit. We recognize some tiers will see an increase nevertheless the methodology we used to develop the tiered pricing model is based on meeting a sustainable cost of sale.
 

Click here to view the new rate card.

2.    Launching Tiered Logo Pricing

Shopping.com is making brand advertising more affordable by changing the logo rate from a flat $0.10 CPC to a tiered cost structure based on the item price. The new rates allow you to economically advertise your brand in front of millions of consumers. These new rates should not exceed 25% of your overall spend.

CPC Rate	New Tiered Logo Rates
<$0.19	$0.02
$0.20-$0.39	$0.05
>$0.40	$0.10

Additionally, we recently completed the full roll-out of our international click filtering program. You will continue to receive international traffic but Shopping.com will not charge you for these clicks, ultimately improving your campaign's conversion to sale.

Learn more on how to take advantage of these new prices and features.

Thank you for your continued business,

Tomer Shoval
Managing Director, Shopping.com US

What matters most to consumers: free shipping, low prices, or coupons?

David Spitz, ChannelAdvisor's COO, has a post over on eBay strategies about the popularity of free shipping, coupon/promo codes vs. value pricing.  We thought his use of Google Trends and insights would be of value to CSEStrategies readers as well.  You can read it here.

Dialing Down MSN Shopping

MSN recently started communicating to active merchants that as of May 2, 2009, all featured store placements and display advertisement inventory on MSN Shopping will be retired. Upon further prodding, we've also been told that no gift guides are planned after Mother's Day. The lack of these elements will certainly lead to a decline in traffic from this long standing engine. However, this is not completely surprising since MSN has clearly been giving much more attention to their Cashback program, which was recently merged with the Live Product Submit program at search.live.com/products.

MSN will likely continue to accept MSN Shopping feeds, at least for now, since there is revenue associated with them. This feed data is already integrated with the Live Product/Cashback area. I would expect the Live Product/Cashback engine to fully replace the existing MSN Shopping system eventually, but if, when and how this would be executed is still unclear.

This integration/consolidation is a natural step and should eventually make things easier for merchants and consumers alike. One has to wonder what share of clicks the non-Cashback listings are getting on pages with "mixed" offers. It seems pretty clear, though, that the MSN folks have some kinks to work out, as reflected in the dueling Home Depot listings below. Showing both listings is a little questionable to begin with since the Cashback listing seems significantly more likely to get clicked, but the inconsistent "free shipping" details (the Yes vs. No in the second column) are pretty confusing as well. That second listing comes from the PriceGrabber network via MSN Shopping. MSN Shopping also gets product data from Shopping.com, so the consolidation effort involves more than just the multiple MSN sources, but external sources as well.

Best of luck to the MSN team on getting this sorted out. I have yet to see any Ciao listings in the mix so it will be interesting to see if they choose to do so, leave Ciao US as-is, or maybe shut it down in the US so they can refocus on Europe.

RIP Nahum Sharfman, Founder of Shopping.com

TechCrunch is one of several outlets reporting the untimely death of Nahum Sharfman, founder of Shopping.com, and his wife, Nava.

Condolences to the friends and family of Mr. and Mrs. Sharfman and the entire Shopping.com team in this sad hour.

Google Product Search Mobile

Google just announced that Product Search listings are now available on iPhones and smartphones that use Google's Android mobile operating system. I guess lowly Blackberry users like myself will have to wait a bit to take advantage of this.

There is an feeling of deja vu around this announcement since back in 2005, Google rolled out Froogle mobile. Updated technology for sure, but with pretty much the same impact.

There are other comparison shopping services with a mobile focus, such as Frugalytics, Frucall, and Pongr. Frugalytics is a pretty straight-foward CSE experience, but with pages designed for easy mobile browsing. Frucall has some interesting additional features for users, such as phone and SMS options, as well as price alert and "tell a friend" functions. Pongr has a downloadable app for iPhone, Android and Blackberry, as well as SMS and email communication options.

Despite the nice features of some of these sites, it's hard to think Google doesn't have an edge in terms of getting traction, even with the current limited support. Since BlackBerry has support for many Google mobile features and is a popular phone choice, it's seems likely that it will be long before the berry version becomes available.

Anyone want to place bets as to how long before we see a Cashback for Windows Mobile?

Shopzilla CPC Rate Changes

Shopzilla announced today via an email from VP of Sales, Beth Sterling, a new rate card effective April 28th that includes significant CPC drops in some categories. This is the second major site to drop CPC rates this year, starting with Shopping.com in February. See the new rate card here:

http://merchant.shopzilla.com/oa/resources/us/updated_rate_card.pdf

With the economy as it is, average order values and conversion rates have been suffering lately, resulting in tough times and tough decisions for retailers. It looks like the changes were focused on technology products, with significant drops for laptops, desktops and digital cameras. Apparel/shoes/accessories and Home & Garden appear to have seen no change. Though I recognize merchants in technology categories are hurting right now, I do think merchants in other categories could use some relief as well.

As I mentioned when Shopping.com announced their changes, it is very refreshing to see a major CSE such as Shopzilla not only take notice but take action. Kudos to Beth and her team for making these changes.

One important thing to note here. In order to take advantage of the lower CPCs, you will need to go into the Shopzilla merchant interface and lower the bids manually. From the email:

"To take advantage of these changes, please log in to the bidding tool via the Shopzilla Business Services site. We will not automatically place or change bids on your behalf."

Return of the...Feed Doctor

I know, I know, you were probably expecting some obvious Star Wars reference. Well, don't be disappointed...

...because the Feed Doctor is back, and over at the ChannelAdvisor Blog he's written a little preview of a fantastic new business rule that both extracts pre-set elements from a list and strips out particular characters.

But he says it better than I ever will. Go check out "The Feed Doctor Returns" at the ChannelAdvisor Blog.

written by Scott Hurff -- scott dot hurff at channeladvisor dot com

The New AOL Shopping is Hungry for Data Feeds

There have been several reports recently about AOL Shopping's site changes and new recession-friendly features. We noticed traffic increases from AOL's new focus on coupons (which like their product listings is powered by PriceGrabber) about a month ago, but it wasn't until the last week or so where we began to understand the impact AOL's changes will have on merchants going forward.

In addition to the site changes, AOL is launching a new program that involves accepting direct feeds from merchants. This data will only power their new storefronts like this one and not the search results (still powered by PriceGrabber), but it is pretty clear this is an opportunity for additional exposure that all merchants should investigate. Pricing is CPC. ChannelAdvisor will be supporting this new opportunity soon.

In addition, since the AOL coupon area is driving more traffic be sure your PriceGrabber coupon URLs have tracking on them so you can see the activity associated with such clicks. They are subject to CPC rates just like product listings themselves.

Talking CSE Strategy with Kelkoo, Ciao and eConsultancy at Catalyst UK

Today at ChannelAdvisor's Catalyst UK conference, Dan Burnam from ChannelAdvisor moderated a panel featuring two of the UK/EU's top CSEs and eConsultancy. The panel included:

• Llloyd Price - Marketing Director - kelkoo
• Tom Hyde - Temamleader eCommerce UK - Ciao
• Linus Gregoriadis, Research Director- eConsultancy
•   

Here are some interesting tidbits I got from the session:
 

Social marketing

• Kelkoo are interested in social media, but not sure about how to make it work given that CSEs are at the end of the buying cycle and social media is frequently very early. 
• Ciao wall application on facebook   

How to get the most out of your channel

• Kelkoo - the datafeed is the best place to focus on quality. That's what shows up on the site, so focus on the feed.
• Ciao has lots of tools for the retailer to help them add/drive user reviews, so using them helps and datafeeds are important too.
• Linus - Make sure you are using a system that tells you exactly what each channel is driving and costs so you can manage things closely.

 
How do you feel about Google coming onto your turf with Google Product Search?

• Kelkoo - we love it. We don't see it as a threat.  What they've really done is just have some basic results.  If I'm a retailer, and I'm getting free traffic from GPS, I can invest that into more paid offerings, so we see it as a positive.
• Ciao - Ciao reviews are frequently pulled in by Google so our retailers actually get traffic from it which we enjoy.
• Linus - 2/3 of retailers are using GPS.  So I say to retaiers to definitely use this channel!

 
 
Q: Retailers want CPA, reduces risk.  Engines like CPC. Which do you prefer / are you focused on?

• Ciao - we like CPC because it's transparent and easily to monitor vs. CPA.  It's working. Are looking at hybrid models, but find CPC is superior.
• Kelkoo - Focused on CPC

 
 
Q: What's the rest of the year going to hold for the economy and ecommerce as a whole?

• Ciao - UK retail climate is ok because the share of offline will continue to grow.  Recommendations are going to be very essential to make sure you are in front of consumers.
• Kelkoo - Everyone focused on smaller items, 'treats', but not high-end.  Retailers focusing on women which plays to our demographic.
• eConsultancy - There are lots of opportunities online still, so focus on those vs. the few people not shopping.  More retailers are doing well focusing on customer service. Twitter is an interesting example of how the savvy merchant can get aboard it as a customer service.  Also focus on customer retention, optimize it.

 
Audience Q&A 
The area of generating feeds is a dark art.  For example yesterday we did 200 sales last month on GPS, only 40 on Kelkoo.  Why can't you help us, the retailer, optimize for your site to get good position?

• econsultancy - Amongst retailers, many aren't even using the channel yet.  Some are doing really basic stuff. Others are really pushing the envelope.  Companies like ChannelAdvisor, with ShoppingAdvisor, can help you not only bridge that gap, but give you the software to implement it.
• Kelkoo - we work best when a retailer shares their sales data with us.  We can't just push back to the retailer, it needs to be a shared process.  We can share keywords that are working too. Focus on pre-orders, we're seeing lots of demand there.  Test CSEs for demand.  use Google Trends data too.  Keywords that convert on google will tend to work well for us too (in your title).
• Ciao - Transparency is the key. We work with retailers constantly to improve conversions and get the most from their investment.

 
Do you take a feed or include eBay or Amazon?

• Ciao - we only include eBay as backfill.
• Kelkoo - We do support eBay/Amazon, we don't get a lot of feedback that they are duplicate and/or have different pricings.

 
Coming at this as a consumer, can you tell me what are the benefits using your sites?  I usually get frustrated with CSEs.  How will you improve the customer experience?
 

• Ciao - At Ciao we have an emphasis on providing tons of information.  We list things from least to most expensive so you don't have to resort.  if you want a panasonic laptop, we have tons of reviews along with the retailers offering that product.  We include total information on availability, S+H, etc.
• Kelkoo - We are more like window shopping - we help give you inspiration.  

 
ChannelAdvisor question - Do you allow us to upload all the google product search items?
 
Yes, we do that today with templates.

Amazon Product Ads Webinar, March 24

CSEs come and go but only a few make a major impact. Amazon Product Ads is the most significant new option since the launch of Froogle/Google Product Search. This program is still developing, but most of our merchants who are participating are seeing increased traffic and, most importantly, strong conversion rates. If you're not already selling your products via Amazon's marketplace, marketing your offers via Product Ads is a great alternative. If nothing else, you'll be wowed by their daily budgeting function, an innovation in the industry.

On March 24, ChannelAdvisor and Amazon will co-host a webinar reviewing the Product Ads program and explaining how you can get started. Our friend Jim Barnes, Online Marketing Manager at Drugstore.com, will chime in as well to discuss his company's success with Product Ads. This is a great opportunity to learn about the features and benefits straight from Amazon, as well as hear first-hand experience from a major online retailer.

If you're interested, visit channeladvisor.com/webinars to register.

Major Rate Drops and More at Shopping.com

The folks at Shopping.com are doing what they can to make things easier on merchants in this tough economy. Wednesday evening, Tomer Shoval, Director of Sales and Account Management at  Shopping.com, sent to merchants an email detailing significant CPC rate decreases in some categories effective March 1 through May 15. In addition, he outlines some future changes that are very interesting:

•  A pricing structure that takes into account product price. This is great news for merchants with lower average order values. Current pricing requires very high conversion rates for low price products, which CSEs are often unable to deliver, making it cost prohibitive to advertise low price products. This may also help Shopping.com expand their catalog significantly.
• Logo pricing tiered by category. This also makes a lot of sense in theory, thought it is unclear at this point what the tiers actually look like. The current  incremental CPC for logo usage is a pretty significant increase at a $0.50 CPC, let alone a $0.20 or $0.25. This change is somewhat amusing to me since several folks here have discussed for years that this type of tiered structure made sense for additional listing features on eBay, Shopping.com's parent company, but such an approach was never embraced.

I am a strong believer in the old adage, "Never look a gift horse in the mouth." However, I can't help but wonder what the motivation is here. We know from eBay's Q4 earnings call that Shopping.com revenue was down 50%. CFO Bob Swan attributed this to natural search algorithm changes that lowered Shopping.com traffic. All else being equal, lower CPCs would obviously result in even lower revenue from existing merchants. However, these changes indicate to me that merchant retention is a major concern right now. We've seen merchants lower budgets and even pause their CSE campaigns completely due to overall cost cutbacks. Shopping.com seems to be sending a message that they are very willing to take actions that result in good ROI, making it very difficult for marketers to pull back on their Shopping.com feeds . Tomer's team has already made changes over the past year or so that have had positive impacts on traffic quality delivered through their network, but the sagging economy may have already counteracted those efforts to some degree. It is very refreshing in my opinion to see a major provider pull the one lever that others have been unwilling to pull in the past in order to ensure their network delivers value to merchants.

Full email below.

Announcement: Falling CPC Prices!

Shopping.com recognizes the current macroeconomic conditions have increased the cost of doing buisness, thus decreasing profit margins. In return, we are making swift and direct changes to help our merchants effective March 1st!

Take Advantage of The Falling CPC Rates on Shopping.com and Add More SKUs and a Logo Today!

Shopping.com is launching a pricing promotion from March 1st to May 15th which reduces rates in over 200 categories. These categories will see savings as high as 60%!

This pricing promotion includes reduced CPC rates in the following categories and more:

• Electronics $0.10 - $0.40
• Computers $0.10 - $0.40
• Home & Garden $0.05 - $0.10
• Kids & Family $0.05
• Jewelry & Watches $0.10 - $0.25

Take advantage of this offer while it lasts (March 1st to May 15th)!

On May 15th, Shopping.com will also be launching its larger plan to better align merchant economics and consumer demand.

LOW-PRICE ITEMS

We will create a tiered pricing structure for some of our leading category CPCs. This will give you the abilty to better align your inventory with the aggressive low-price-focused economy.

VARIABLE RATE LOGO PRICING

We understand that the logo price today can be cost prohibitive. This is an issue that Shopping.com is directly addressing for our merchants by:

• Decreasing rates on average by 30% and as much as 60% across those categories that experience high Cost of Sales.
• Tiering our Logo Price Structure by CPC.

These new prices will enable you to add your logo and promote your brand in a more cost-effective way.

Shopping.com cares about its merchants and wants to ensure you have the tools needed to make your business work in this tough economic environment.

New Kelkoo Algorithm

Kelkoo recently sent out emails with some detail about the launch of their new search algorithm. I received this email today, so I'm not exactly sure why yesterday is qualified as  "Thursday" but I think this signifies a step in the right direction for Kelkoo. I was once told that the order in which products in data feeds were processed was a factor in their past display algorithm, so anything focused more on query relevance and historical traffic/click through data is welcome.

Full email:

Dear Merchant,

We wanted to share with you some important and exciting improvements that we have made to the Kelkoo search algorithm.

After months of analysing the vast amounts of data, on users' searches, user and merchant feedback, offer relevancy and quality, Kelkoo has built and launched a new search algorithm.  The key objectives are:

• To improve the service and quality of the traffic we send to you to increase your sales
•  To improve the relevancy and quality of the offers that we show to our users when they search on Kelkoo

In addition to the cost per click, a new performance criteria for each of your offers has also been applied.  By incorporating the user choice in the algorithm, the Kelkoo search aims to improve its service and quality of traffic that we send to you to increase your sales.  Offers that are complete and descriptive, that include good quality images, accurate pricing, stock and delivery information and where users rank them highly stand a much better chance of appearing higher in the search results that are displayed to users.

This new algorithm was launched yesterday (Thursday). We hope you agree that it’s a vast improvement and we invite you to test it on www.kelkoo.co.uk

CSE Marketing in a Tough Economic Climate

In case you haven't heard, the economy is having a bad hair day. Because of declining consumer spending, all marketing initiatives are being evaluated at many retailers. It's a sad fact, but marketing on comparison shopping engines can be labor intensive and depending on several factors, expensive. There seems to be a trend of online retailers reacting to these conditions by slashing budgets and in some cases, pulling feeds down completely. While decreasing budgets may be necessary, for most retailers, eliminating the program completely is not the best way forward.

Below are thoughts on what retailers should keep in mind when considering the future of their CSE campaigns. Though there may be other issues facing retailers right now, such as challenges surrounding credit, product sourcing, etc., these comments are intended to be independent of such complexities.

• Give credit where credit is due: I sometimes hear merchants say "my CSE program isn't working," when the reality is usually "only part of my CSE program is working." Most retailers currently operating on CSEs have some subset of products that are selling consistently. Our experience is that the many products that repeatedly sell on CSEs are very efficient and usually profitable. Even if the total campaign is not achieving your goal, some products probably are. If a Google AdWords program was operating below goal, I doubt many merchants would completely shut it off. They would lower bids and probably remove certain campaigns, adgroups or keywords that are not performing. CSE is no different in this sense. Recognize successes within the campaign and keep them going. It's an extreme step, but if your business is in crisis mode, removing all products except for this subset of consistent sellers can result in much lower costs while retaining some profitable revenue.
• Rebuild slowly: If you do take this sort of action, you will probably find that the products that are working are a small piece of your overall product set, which makes it likely that the cost incurred by those items is also a very small part of the total cost of the campaign. Recall from past discussions about the long tail of CSE feeds that in most cases, the majority of cost comes from activity on items that drive no revenue. This means your newly slimmed down CSE campaign may be over-efficient. This is what we often see when we take this approach of cutting out the long tail completely because the majority of the risk and uncertainty is removed. If this is the case, it may be best for your business to take that extra efficiency to help offset some other channel, but many retailers will be able to reinvest in CSE. Do this by re-introducing products/categories into your feeds to try to get the maximum revenue while still operating within the construct of their financial model. The best way to do this is to start slowly and watch to see how the reintroduced products/categories perform.
• Focus on your strengths: Regardless of economic conditions, most consumers will continue to shop based on value. Price sensitivity will certainly increase, but issues of quality and trust never completely vanish. Therefore, when choosing products/categories for reintroduction into your feeds, it is best to be realistic about your value proposition and how you measure up to your competition. You wouldn't be in business if you didn't do something right, so focus on including only products or categories where your value is strong.
• Maximize CSE feature use: Having a strong value proposition is key, but it is not beneficial unless it is clearly communicated. Many CSE marketers overlook the basics, such as completing the CSE merchant account interfaces with accurate payment types and customer service info. These elements can impact your rank and conversion rate. In addition, user reviews become even more important as consumers are less convenience-oriented and more value-oriented, so be sure to participate in these programs whenever possible. Display of shipping costs, tax info, promotional messages and coupon details should be maximized as well. Your goal should be to convey your value to the consumer as clearly as possible before any clicks are made. Providing as much information as you can will help protect, if not increase, your conversion rates and ensure your competition isn't winning for the wrong reasons.
• Understand the long term impact of your actions: I can't emphasize this one enough. What you do today on CSEs has a direct impact on your future ability to drive CSE revenue. Many CSEs have some sort of popularity function that is based on historical activity. This means that if you take your products down for a few weeks or months, getting back to where you were is very difficult, as if you were starting over from scratch. In addition, most CSE review programs require recent feedback in order to display those rating on their site. If you already have a positive merchant rating, keeping your campaign live is the only way to protect it. The bottom line is that if you pull your best products down today, you are seriously risking that revenue stream not just for the time those products are down, but for much longer.

If anyone has specific challenges, please share them and I will do my best to help.

CSE Wishlist - Part 4

This is one that my team and I have been been dreaming about for some time now.

Availability of impressions/CTR data.

Click-through rate (CTR), defined as clicks divided by impressions, is a key metric in the search engine marketing world as well as display adverstising. CSE marketers do not, in most cases, have the ability to analyze this metric since none of the major CSEs provided impression/CTR data in the reporting interfaces. The only CSE I can think of that does make this information available is Smarter.com.

Reasons this would be valuable, much as in the SEM world, include:

• Identfying issues with specific offers: If CTR is low, the offer is not compelling and needs to be evaluated and tested with improvements. This is very valuable information and is alone enough to make this data desirable.
• Helping to track the impact of changes: Obviously traffic alone is a valuable metric for determining the effects of changes made to titles, promos, pricing, etc, but impressions and CTR are helpful metrics as well.
• Understanding the size of the CSE opportunity: This is a common question we hear from merchants and it is difficult to answer. Knowing how many page views a merchant's offers receive would provide additional insight into the level of interest on each engine.
• Providing insight into market share: This is another question we hear a lot. CTR isn't really a market share metric (if CSEs want to publish actual share of traffic, that would be great, too, but that seems unlikely), but it does help give some idea. Also, if a merchant's offer is visible on a product page next to their competitors, knowing the ratio of CTR to number of competitors could be very interesting. Not every impression yields a click so this wouldn't be a bulletproof metric but something worth tracking.
• Measuring performance of rank: Some CSEs support bidding at the category and/or product level. Not surprisingly, those that support it also recommend it. These engines state that offers ranked first get more traffic, which is often true. However, in moving from rank 3 to rank 1, if traffic increases 10% for that offer, it may be due to an increase in impressions to the product page and not just increased traffic yielded by the change in rank. Providing impression data at the offer level would help these CSEs make their case for bidding up, and provide the merchant with better information on which to base their bidding strategy.

There is one significant downside for CSEs if they were to make this data available, however. As our friend JP at Downtown Ecommerce Parnters argued many moons ago in his guest post on comparisonengines.com, omitting this data helps to keep merchants guessing. It's no secret that much of the traffic delivered to CSEs is acquired and not direct, so hiding these impression numbers help mask the details around traffic fluctuations that are at least partially a result of CSEs own marketing/merchandising activities for their properties, as well as the similar efforts of their affiliate partner sites.

For now, we expect to keep dreaming.

CSE Wishlist - Part 3

This is one that I think CSEs should want to embrace because it is all about communication between the merchants and the consumer.

More/better ways to demonstrate value proposition.

There are already elements in existence that help merchants communicate their value proposition, such as promo text, ratings, logos, and obviously the price of the offer itself. However, many possibilities for improvement remain. These are the ones at the top of my mind:

• Real time promotion messaging: The timing around the display of promotional text is painful. Short promos such as one-day sales are pretty much impossible to get right through the feed. Entering such information through the merchant UI with controls over timing, or timing controls in the feed, would allow merchants to be more confident in presenting short term promotions on CSEs.
• Real time price changes: Same as above for pricing. Some merchants have one hour or two hour price drops that can drive a lot of sales but it's impossible to promote such offers on most CSEs right now. (PriceGrabber already allows this one in the merchant interface under "Click-Thrus by Product")
• Warranty and service options: Merchants could put this sort of information in promo text, but it's not as attractive and would be replaced if they had any real promotions going on. There is value to these options, though, especially on certain product types, so some default indication should be made visible as opposed to just burying the information in the description.
• Configuration/Customization messaging: Obviously this can be included in titles, descriptions, and promo text but it's still hard to get the message to consumers, especially when it applies to all of one's products. For this point and the previous one, a possible method to convey this information would be something akin to the gift icon on eBay (but free).

If anyone else has specific ideas, I'd love to hear about them.

CSE Wishlist - Part 2

As I mentioned in my last post, a major theme in this series is that of control for the merchants. Here is another CSE wishlist item in that vein:

More insight and control over affiliate partner sites.

For those who don't know, some CSEs get a LOT of the traffic for which they charge merchants from affiliate partner sites. For example, PriceGrabber's comparison shopping data is used on CNET and AOL Shopping. Shopping.com has hundreds of partners, and offers both a full API or widgets for the less savvy. There are many more examples, enough to make one's head spin, but that is not the focus here.

As a merchant, it is difficult to know what percent of traffic is coming from these partner sites and whether that traffic is converting. The traffic spikes I mentioned in my last post sometimes blindside not only the merchant but the CSEs themselves because they are the product of promotions run by these partner sites.

Shopping.com has taken a step in the right direction by introducing their Value Based Pricing program, which is intended to offset the lower return delivered by some of these partner sites. The system basically lowers the CPC charged for clicks originating from sites that yield lower conversion rates. Kudos to the SDC team for this innovation, but to the merchant, it is still a black box. Merchants would prefer to be at the helm rather than be reassured that something is being done about it.

I think it is fair to include new merchants in the entire network, but allow them to opt out on the partner level. This is not just a way for merchants to control conversion, but also cut back on spend in lieu of the additional budget controls discussed last time.

I am trying to be realistic about these requests, so it may be more likely that CSEs publish a list of partner sites or maybe report how much traffic comes from the network. Regardless of the details I think any step toward transparency would be welcome, but the ultimate goal should be to allow merchants some level of control.

CSE Wishlist - Part 1

Since it's a new year (almost), I thought it might be a good time to discuss some new features from which merchants would greatly benefit. So to all you CSE product managers out there, tune in over the next week or two. Here is the first request:

More budgeting options.

Most CSEs only offer monthly budget caps, but there is no way to control the rate at which that is spent. Much like AdWords, one or both of the following is needed:

• A function that attempts to balance the spend across the month.
• A daily cap that ensures a set amount is not exceeded for any day.

This would be especially valuable for small/medium-sized merchants who want to test the waters but may have trouble keeping their account active because they can't afford to let it run free. There is no reliable way to forecast what traffic levels will be, even for merchants already live on a particular engine (many CSE's own documentation indicates such). Remove the risk so they feel comfortable.

For larger merchants, this would allow feeds to remain larger and lower the risk of having to go dark at the end of the month/quarter. Since spend velocity is currently dictated exclusively by user behavior and engine/affiliate promotions/merchandising, the only lever the merchant can pull is to remove products from their feed. This is a necessary evil but isn't ideal for merchants, engines or consumers.

Most importantly, this will shield merchants from the dreaded traffic spike. Some engines are more prone to this than others, but at times, merchants will see huge traffic increases for a single day, either on a single product or across a few products. Sales may increase, but often the quality of that additional traffic is poor, so the return on that spend is usually very poor. Such spikes typically result in requests for click cost credits at least and complete feed removal at worst, so no one really wins. Ideally the engines would coordinate the promotions that results in such spikes with merchants before-hand as well, allowing merchants to authorize an override of their daily cap.

I think I know what the CSE folks are muttering right now: "Our system architecture can't support this!" and/or, "This will lower our revenue!" I believe you, but I think if you could work toward this, you would get and retain more merchants, meaning more products/listings/revenue in the long term.

One of the overall themes you will see in this series is that of more control for the merchant. Comparison Shopping is a complicated and sometimes overwhelming channel, one that is often misunderstood. I think the more control merchants have, the more likely they are to try the channel, see some success and therefore continue with it.

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Written by Scott Hurff (scott.hurff at channeladvisor dot com)