The New Year is looming, and so are new industry rules and changes. Theodore Hettich from price comparison provider Become Europe discusses how these developments will alter the online landscape for brands and retailers.
From its humble, experimental beginnings in the 90s, price comparison has boomed into a £1bn industry. Savvy shoppers have come to rely on the ease and accessibility of having the best deals delivered to them. It’s common knowledge that customers are engaged with the positives a price comparison website can offer, but the industry will see rule changes and new global opportunities throughout 2015. As the market becomes progressively opportunistic, corporations such as Google will further invest. While Chinese retailers are increasingly looking to the west for the potential to offer low prices, UK companies hope to explore new overseas territories to expand on a worldwide scale through price comparison technology. So what does all this mean to the market?
Price comparison options envelop the web. From flights to fridges, broadband to bread-makers, consumers are able to find a service to compare anything they wish to buy. At the moment, users have a number of price comparison websites to choose from. What is becoming more apparent is the emergence of Google as a runner in the comparison market. A new campaign from Google Product Listing Ads (PLA) backed by Google Analytics, called Shopping Campaigns, makes it easier for online merchants to connect with consumers and promote their products. Google is highlighting what can be achieved from price comparison platforms, pushing wider acceptance among global shoppers.
2015 will see many changes to the market. These will bring new developments and advances across the industry to many different companies, driving wider use of providers. What Google’s campaign signifies is how its everyday internet influence will be further unmistakable throughout the coming year. As it begins to offer different services across a range of categories, the wider global market will open up and there will be further investment across the price comparison market.
Delving into new markets across the board, and across seas, will be a common trend for 2015. Another power player exploring the advantages of internationalisation is the Chinese retailer.
The UK has already seen a high number of Chinese retailers entering the market with significant retail names such as StrawberryNET, DHgate and Alibaba. These merchants are cutting out the middle man and approaching customers directly – fulfilling product demand without selling via well known British brand names. So rather than China selling products to UK retailers, China is beginning to sell products directly to the British consumer across the globe through price comparison providers.
Using price comparison websites in the UK and allocating a substantial advertising budget allows the Chinese retailer to target products to the UK audience at a significantly reduced price compared to local retailers, as there are no distributor fees or brand names to be paid for. With fewer overheads than their overseas competitors, Chinese retailers are able to use a big advertising budget to get their brand message and identity across.
Products will be cheaper and the likelihood is there won’t be any issues when the user makes a purchase. Nevertheless, keeping the customer 100% happy is crucial. Without UK brand name assurance, overseas delivery issues and the unpredictability of customs and import taxes, Chinese retailers cannot achieve the same level of guaranteed smooth sales that an established UK retailer can convey. Yet, as more consumers become regularly acquainted with Chinese retail names through extensive advertising, more consumers will be open to buying directly from the Asian market.
The number of retailers targeting unknown territories via price comparison services is predicted to surge in 2015. It is now easier than ever for retailers to reach and deliver products to the wider global market using this technology. Whether the UK retailer is small or large, its product feed can be used, the currency can be changed and then posted to other price comparison websites in English speaking countries.
With an English feed, American, Australian and Scandinavian markets can be targeted, bringing merchants further revenue. It is a low risk way to internationalise. Merchants will be trading through price comparison experts the same way they operate in the UK, using a service they already trust to achieve wider trading success.
As the global market widens, the price comparison industry will see benefits from growing internationally during a time when many companies are investing in tools to monitor the customer journey more thoroughly. Detection of where a sale originated from will be easily noted and extremely beneficial. Alongside this advantage, ‘last cookie wins’ policies will be phased out in favour of the CPC (cost per click) model.
As companies change their attribution models and move away from last cookie wins, price comparison providers will experience a positive influx of revenue as the source that aided the customer at the beginning of their journey. If the customer click derived from a price comparison website leads to a sale, the customer journey detection tools will highlight that revenue will need to be awarded to the original provider. Stricter terms and time limits will be applied to the system but ultimately, fairer opportunities will be granted for the initial search providers.
The industry has come a long way over the last two decades, however the approaching year promises a new era of global opportunity across the price comparison market, opening up new territories and offering more choice for millions of consumers.
By Theodore Hettich
UK Country Manager
Become Europe
www.become.co.uk