Consumers criticise comparison sites

1. http://www.shopwiki.com/ and http://quickshop.co.uk/ show unbiased results. It is true, most sites have a large bias towards what merchant pays them the most.

3. Your article reporting on recent survey findings from Quidco highlights a crucial point – that consumers want clarity over how price comparison sites work.

Quidco is hailing impartiality and the importance of unbiased product comparison for the consumer, unfortunately I do not think they are interpreting the research in this manner. The research shows that the most important factor for consumers when buying online is price and impartiality, and we also see that these are the most important factors by a long way when consumers decide what retailer to buy from. To claim Quidco is impartial is not entirely correct owing to the fact that they only list merchants providing a cash-back, hence limiting the user from the full merchant and price selection available in UK. Quidco does not list all merchants, only the ones paying a sales commission.

When explaining how price comparison sites work, Quidco correctly notes that the majority of price comparison sites only list the paying retailers or merchants. However, this is not the case for all sites. PriceRunner is different – we list all of the merchants as is possible and we’re 100% impartial.

Ever since our inception in 1999, PriceRunner has always been completely clear about how we operate. Unlike many other price comparison sites, we list the cheapest price first, including delivery, regardless of whether a retailer pays us for an enhanced listing or not. For example, when searching for retailers stocking this laptop (http://www.pricerunner.co.uk/pl/27-887921/Laptop-Computers/Acer-Aspire-9301AWSMi-Compare-Prices), retailers 3, 4 and 5 on the list haven’t paid us an advertising money, whereas retailers 1, 2 and 4 have, as indicated by the logos, retailer descriptions and direct links out. But we’ve ranked them on the lowest price.

The different in price between the cheapest and lowest price is usually substantial, often around 50 percent. Cash-back sites have a role to play in the market since they provide their users with a discount on the list price for the merchants they work with. A price can be lower than the lowest list price, however, there is no guarantee that is the case and their user might loose out if they have not done their research on an impartial price comparison site, i.e. PriceRunner.

Unlike purchases through credit card technology companies (every consumer pays a small percentage of the purchase price to either operator and it’s built into the product price), consumers don’t pay to use PriceRunner. Yes we take a commission on customer leads that go to a retailer (which is the same for every retailer in a particular category) and we also have lots of companies advertising on our site eg. traditional banners and other such forms of display advertising.

We also provide added value and information by developing product buying guides (these are just two examples http://www.pricerunner.co.uk/ba/2/TV-buying-guide and
http://www.pricerunner.co.uk/ba/11/MP3-Player-buying-guide), we have a user forum on the site, users can upload retailer reviews and impartial merchant ratings based on user experience, as well as user and expert product reviews. All these factors enable our retailers to know that when they receive a click through from our site to theirs, the user is more likely to be very close to buying.

Lastly, we can’t help but feel that the survey hasn’t summarised one of the key issues – whatever the perceived shortcomings of price comparison sites, they offer the most comprehensive information on the retail marketplace to a potential buyer and they will save time and money. And we certainly know our users like that.

Mattias Berg
UK Managing Director
PriceRunner.co.uk

5. An article just came out this morning on Yahoo UK news regarding this topic of financial agreements on retailer ranking: http://uk.news.yahoo.com/techdigest/20071024/ttc-twenga-promises-a-different-kind-of-e870a33_1.html

It reports on a new site called Twenga as an unbiased shopping search engine. Apparently the product listings are not related to financial agreements. If it lives up to its claims it might be an interesting player in the price comparison site landscape.

The article doesn’t list the site address -- so for anyone who wants to check it out, the UK site is http://www.twenga.co.uk.