A survey by cashback website Quidco has found that one in three British consumers have stopped using price comparison sites, with a further 47% put off by 'biased' results.
The consumers are reportedly concerned that results on the sites are displayed according to which company pays the most for their listings.
Other findings from the survey, which was conducted by Tickbox.net and polled 1,652 British adults in June and July this year, included:
- One in three shoppers go directly to specific websites, while the remaining 70% start their online shopping with a search engine, cashback or comparison site.
- Customers value service more than security - just 23% said security was a concern when shopping online, while just 5% cared whether the site was easy to use. Good customer service was the key for 65% of respondents.
Comparison sites seem to have been coming under greater scrutiny in recent months - some it prompted by Direct Line's recent TV ad campaign.
Also, as per Ashley's blog this morning, not all companies are convinced about the ongoing value of comparison site users.
Further reading:
Shopping Comparison sites facing major challenges
Graham Charlton is Editor at Econsultancy. Follow him on Twitter or connect via Linkedin or Google+.
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2:47PM on 17th August 2007
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.
2:34AM on 22nd August 2007
This isn't surprising at all. Did we think the comparison shopping sites were in business for altruistic reasons? Of course not, they want to make as much money as possible. Personally I have never used comparison shopping services. I prefer to do my own research and web queries and will keep it that way now in light of this news.
PR Executive at ValueClick Europe
5:38PM on 22nd August 2007
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
4:01PM on 24th October 2007
I came accross this site Twenga recently, who claim to have no retailer bias whatsoever. After having a little look, I have to say I was impressed by the number of merchants available to browse, and the fact you can arrange products as you wish - either by size, lowest price or highest price. I am not generally a user of price comparison websites, but for those who are, I do believe this one is on to something good.
6:22PM on 24th October 2007
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.
6:33PM on 27th March 2008
Just to respond to Mattias Berg form Pricerunner, he says Quidco is not entirely impartial, he is wrong with that, they are impartial, the reason he says they are not is because they don't list all retailers which of course they don't because they can only list ones that give cashback to the customer. This is the whole point of what they are - cashback, they are a cashback site so it would be misleading for them to have a retailer on the site who does not give cashback.
Quidco make their money form membership and not the merchant's commission, so they have no reason to favour one particular merchant. I used to work for an affiliate network (this is where they get the cashback links from) and they would not be interested if we tried to push a merchant to them, only if it did genuinely have a good offer for the shopper (high commisison bonus etc)
7:57PM on 2nd May 2009