The prolific growth of Internet search engines is taking e-commerce to new heights. Responsible for directing over 20% of traffic to e-commerce sites, search engine usage is still growing rapidly. And as testimony to the huge choice available to today's consumer, the new search engines are specialized services which offer product & price comparison within vertical markets.

Too much choice leads to confusion. Enter the Internet Shopping Engines!  

Shopping Engines   
It probably started with Television Shopping Channels which displayed & demonstrated products and provided telephone contact numbers & addresses for purchase. With the web (as well as digital television platforms), these services became interactive, permitting the user to immediately consumnate his desire to own/experience the brand/service.

This was followed by online marketing sites like Amazon.com which became one of the world's largest online retailers. Then came the online classifieds sites which encouraged sellers to "post" their items. And made it easy for buyers to bid for and purchase them. Free sites like the hugely popular craigslist.org made their promoters into cult figures. Google Base is the latest entry in this space.

Meanwhile the world saw another kind of specialist "vertical" search engine - the shopping engines. Most shopping engines operate as "impartial calculators" - taking data feeds from collaborative service providers. And the way most shopping engines operate, no fee is charged from users. Instead, a commission/fee is charged from the service providers for each new consumer who signs up through the engine (web-site).

Of course, this revenue model leaves room for partisan recommendations - but so is the very successful ad agency revenue model (where the ad agency represents the interests of the advertiser but is paid a commission for every ad released to a media seller).

Amazon.com     
The original shopping engine, amazon.com offers book reviews, similar titles & ranking by readers. Not focussed on price, the successful Amazon model is based on providing the widest choice to its user.

The Ebay Model   
Online classifieds sites could be considered as the next stage of Internet shopping engines.

Ebay started a revolution - by converting their web-site into a collaborative platform for buying & selling. An extension of the classifieds ads in newspapers, ebay took the model a step further by using the new technology to offer immediate sales closure, bidding with deadlines, etc. While ebay charged a fee from the seller, Craigslist offered the same service free of cost.

Today's engines have gone even further. By providing "impartial calculators", they can compare costs & offer a wide range of choice to today's confused consumer. This in turn, has taken the consumers' experience & expectation a step higher - expecting to be spoonfed with relevant information, based on individual preferences and sorted in order of increasing prices!

Shopzilla   
Founded in 1996, Shopzilla (esrtwhile Bizrate.com) is generally considered as the best shopping search engine on the Web, with over 30 million products from 40,000 stores. Shopzilla has developed a proprietary shopping search algorithm called ShopRank which balances price, popularity, availability & reputation. Like Google, ShopRank relies on a continuously updated merchant & product ratings database, which is collected from 1 million online buyers every month.

Needless to mention, Shopzilla's cash register rings each time it sends a consumer to the web-page of an online merchant.

Shopzilla was recently acquired for $525 million.

Utility Search   
Shopping engines have come a long way. This is illustrated by uSwitch.com - a search engine for utility companies like electricity, telecom & broadband service providers.

With a propreitory software which compares costs of competing service providers and recommends the lowest prices, uSwitch as its name suggests, encourages the consumer to switch to a lower priced service.

Uswitch is positioned as a "utilities price comparison service". Most recently, it started offering best prices for broadband service providers. (With numerous of ISPs providing packages with different speeds & prices, customers certainly need help in navigating the multiple choice on offer!)

Any surprise that uSwitch revenue/profit is slated to grow from $25 million/$10 million to $40 million/$15 million ? (Also no surprise that uSwitch was recently purchased for $336 million!)

Google's Plans   
Today, no discussion can be complete without mentioning Google.  Google has just announced plans to enter the online retail industry, starting with Europe. Beta site, Google Base is being developed into a "full-fledged online retail platform".

Currently positioned as an online database to which users can submit a variety of information including items for sale, Google Base is not unlikely to go the Shopzilla way - giving retailers a chance to offer their products to Google users.

Choice & Confusion   
Shopping engines are ideal for markets where choice & confusion reign. Very soon, that description will cover the entire globe !