Ecommerce is now nothing like it was ten years ago, independent online shops now have so many ways to reach new customers. Besides marketplaces, one of the most impactful of them are now price comparison sites. These aggregators grew to major players in ecommerce and how they work is fascinating. Find out all about them from this article.
Table of contents
- From an experiment to a standard
- How price comparison sites work
- Best UK price comparison sites
- They compare for you, but still compare them
Once an experiment, now a standard
It may come as a surprise, but price comparison sites are older than many Internet users. In fact, the first working concept was launched right before the Dot-com bubble and was one of the reasons why the bubble happened. After all, we were all fascinated with every new way the Internet could make our lives easier and more fun.
In 1995, Andersen Consulting (now known as Accenture) created BargainFinder as an experiment, to check if it possible to aggregate and compare prices in ecommerces, how to do it and how would the market react. Soon after launch, the media went crazy, just as with every new Internet-related technology back in the day. In fact, the web development he conducted was amazing.
The future of shopping on the Net exists in prototype today at BargainFinder http://bf.cstar.ac.com/bf/. Using an agent process developed by researchers at Andersen Consulting, BargainFinder searches through the catalogs of eight online music stores and finds the best price for the CD of your choice. One click takes you to the store with the bargain.
ELECTRIC WORD, 10.01.1995
BargainFinder not only shocked the customers by showing them where to buy cheaper, but it also shocked the sellers. The service did not inform the shops about anything and just aggregated data from everywhere. Owners of shops with higher prices went furious and just took action to withdraw their offers from the price comparison site. In the end, the experiment had very polarised results.
It was not the first commercial project, though. However, after this presentation, the idea was publicly known and it was just a matter of time for someone to monetise it. Netbot, a Seattle startup company founded by University of Washington professors Oren Etzioni and Daniel S. Weld and another Internet bubble star, was next. Their Jango, a plug-in for Internet Explorer and Netscape Navigator was all over the media in 1997.
The way it worked seems so obvious now. It was just one of the earliest “intelligent agents”, as this type of software was called then. It automatically triggered simultaneous searches of the entire Internet using established searching services such as AltaVista, HotBot, Lycos, InfoSeek, Yahoo! and Excite and presented the best, precisely selected results to the user.
We reach out on the Web and conduct large numbers of searches simultaneously and return to our users a comprehensive report of everywhere they can buy something, what it costs and much more information.
Dan Weld, creator of Jango, Chicago Tribune, July 25, 1997
I guess, we can say that modern price comparison sites began with Jango. The startup was so successful, it made its founders millionaires when they sold it to Excite for 35 million dollars.
What price comparison sites do on the backstage
On the first glance, price comparison sites gather data from ecommerces to process it and deliver specific results to the user. Behind the curtains it is a bit complicated, though.
There are three basic ways a price comparison site can grab data.
Web crawling
Probably the most legacy method of gathering data price comparison sites use is sending bots to crawl (or scrap) the Internet for ecommerces and scan their catalogues. Basically, it’s a similar technology search engines utilise. What is important, ecommerces may often be unaware of their presence on price comparison sites, in this case.
Feeds directly from merchants
Nowadays, most price comparison sites cooperate with ecommerces directly by processing data sent by merchants. This way, both sides build long-lasting relationships, however in order to be present on the listings, sellers often have to pay a fee. Moreover, data collected from thousands of merchants may be in multiple formats and problematic to integrate into one platform.
Third-party API
There are specialised companies that offer APIs which can be integrated into ecommerce platforms and transfer processed data to price comparison sites for a fee. The sum usually depends on the volume of data extracted. Using such a dedicated solution solves a lot of problems and allows for much savings, when utilised properly. However, implementation of this method can be a troublesome task, especially when merchants use different platforms.
Leading price comparison sites in the UK
Price comparison sites can specialise in more than just typical products, such as electronics or home appliances. In fact, nowadays, customers can often save the most on services, financial ones too. In the UK, there are at least five sites that do it in effective ways.
Confused.com
Whether you need to insure your car or find the optimal mortgage offer, Confused.com makes everything easier – and cheaper. Moreover, the service offers a number of discounts and rewards for using its offers. Also, just as the name suggests, Confused.com is full of practical information and explains everything you need to know in very simple words, is free to use and safe, thanks to being regulated by the FCA.
GoCompare
Another very comprehensive service, GoCompare seems to be even easier to use and equally practical, however it works with many more industries, such as household bills and travel. It’s also very trustworthy, too, since its launch in 2006 it’s been collecting positive reviews and right now it claims that over 94% of its users are happy with the service.
Compare The Market
You’ve probably heard about Compare The Market thanks to its furry mascots, but don’t be fooled by their appearance. This service helps finding great deals for all kinds of insurances and household utilities. As far as the reward system is concerned, in this case you’ll be encouraged to use Compare The Market with cinema tickets and Meerkat Meals – savings at restaurants and takeaways.
MoneySuperMarket
MoneySuperMarket’s novelty feature allows you to monitor how much you spend on utilities and insurances in order to optimise your spendings. For example energy and gas bills – the service offers a simple app, where you can enter information about how much you spend on electricity and the system tracks it all down by monthly scans to offer you a better offer, you just need to decide for it. And it’s a completely free service.
uSwitch
If you are looking for a cheaper energy bill, uSwitch has the tools to help compare gas and electricity deals. But not only that – this price comparison site also works with personal finances, mobile phones, broadband, TV and insurance. The distinctive feature of uSwitch is the ease with which you can change the operators in order to save and advices from experts who can help you make decisions.
They compare prices, you compare them
As always, choosing the best offer depends on your choice. No matter if you manually search for deals directly on websites of insurers or you decide to save time with a price comparison site, be aware that the deals offered by different providers may still differ. While the time saving factor is decisive here, make sure to still check a few services before spending your money. And on the other hand – if you operate such a website on your own, monitor the competition and evolve to meet the ever changing demands of the market. You can do it with Code & Pepper.