About a year ago, I found a company based on West Coast that had strong connections with Comparison Shopping Engines (CSE). I researched and read everything I could about Wize Commerce and was left confused.

I have been keeping an eye on the Comparison Shopping environment in the US as Google continues to circle around the industry.  I am going to say it as I don’t think anyone else will, I fear for the industry in the US and believe now more than ever that 2013 is a make or break year. Google and Amazon are slowly taking developed markets under their control. Google Shopping, Product Listing Ads, Amazon.com and Amazon product ads are all taking clicks and eyeballs away from Shopzilla, Nextag, PriceGrabber, TheFind, Pronto, Shopping.com and Bing.  Shopping.com and Bing is in a different situation as they are part of an ecosystem for their respective owners (eBay and Microsoft) and have in my mind less pressure to be profitable.

Jeffrey Katz is one of the most vocal CSE President’s and he has not flinched in calling Google out on their operations on Google Product Search. I noted that when Google Shopping came around he has started to talk more on general ecommerce trends. I am not going to debate Google’s impact on ecommerce or Comparison Shopping as that is another long form post in itself.

Katz wrote an Wall Street Journal editorial on his views on Google’s usage of  market dominance to harm others. It became a heated topic as Amit Singhal wrote a rebuttal inside 6 hours. The mere fact that Google responded to the claims that Katz made, can be seen as confirmation that it hit a nerve at Google. Danny Sullivan also chimed in as usual and made a point that the Katz piece had a lack of transparency. The Google topic will remain filled with controversy as long as the search engine is a majority driver of traffic to websites across the globe.

NEXTAG rebrands as Wize Commerce? marketwatch.com/story/digital-…

— Siva V. Kumar (@siva_v_kumar) July 24, 2012

Katz then went quiet and suddenly Wize Commerce came on my radar. I think it is pretty clear that in developed markets, big firms with large wallets will always dominate the independent operators. Wize Commerce is in my mind something between an agency, a technology business for enterprise customers and a commerce business. It is very difficult to describe the company as a single business except maybe that it is an ecommerce business.

Wize Commerce = Agency + Technology + Comparison Shopping Engines

Wize Commerce has a very solid shopping network and has a presence in a variety of markets. It has Revenue Optimization services, Traffic optimization and a concept called Silhouette. If you add these all together then it is clear that the main purpose of Wize Commerce is to make revenue from ecommerce without dependance on Google.

The Shopping network:

guenstiger.de is a leading online price comparison service in Europe providing products in the area of consumer electronics, household, and leisure goods. Consumers use the portal to easily and quickly compare millions of products and prices from thousands of online merchants and offline retail shops throughout Germany. The portal also provides invaluable information to support consumer-shopping decisions, such as product information, merchant ratings, professional test reports and user opinions.

Fansnap is the leading ticket comparison-shopping site, displaying 19+ million tickets to 70,000+ events.

Calibex is a Silhouette of the full Wize Commerce platform, where we focus on seller quality optimizations as a means to satisfy shopper intent and maximize merchant performance.

Omniprix.com is a comparison shopping site in France that showcases only the broadest selection of sellers and a distinctive image rich UI. We designed, implemented and fully launched Omniprix.com site back in July of 2011. Since then, we have been sending SEM traffic with amazing results including, boosting our presence in the French market by nearly 10%.

Testeo.de is a fully functioning product review site for the German marketplace.

Then Wize Commerce announced via the Nextag merchant blog that they will be launching PriceMachine, a new CSE. PriceMachine is to be focused on price of merchandise.

Although we generally don’t favor the idea of promoting “lowest price” as a principal differentiator in the marketplace — it’s often not good for merchants, or suppliers — we’re realists in recognizing that most shoppers have a strong urge to understand as much as they can about price before they buy. We can’t ignore this trend any longer, and so Price Machine will be an important information source for strongly price discriminating shoppers.

So what does this all mean?

1. I think Wize Commerce is a strategic move by Katz and his leadership team. While they  can continue to iterate away from being dependant on Google, they have created their own value chain.
2. Wize Commerce is aimed squarely at larger merchants who have budgets that can be used to get conversions and clicks.
3. I think they will continue to acquire business to build a defensible position from the impact that Google has on ecommerce in North America.
4. I find it curious that Nextag, whom claims to the best independent comparison shopping engine in the US, have not been added as a partner by Google Shopping. In my mind it indicates that the relationship between Nextag/Wize Commerce and Google is a strained one.
5. I have no choice, but as an agency, is their no conflict of interest in having a holding company enabling third party services to a specific assets clients? This reads a lot like the model Rakuten uses in Japan and as someone who works in the comparison shopping this whole ecosystem raises many questions.

A few thoughts on PriceMachine:

First off, the colours used on the website is far from exciting and the drop down menus for the categories is difficult to use. I viewed the website from my iPad and the “more” category menu item was seen off the page.

The search result page have images very close to one another and makes selection a bit difficult. In general usability should override revenue generation and this initial layout raises a few concerns for me:

One, the lack of call to action on category pages is not making me click on the product I want. Secondly on product pages, it feels very cluttered and keeping focused on making a decision is a difficult. The mere fact that the related items is shown on the top right hand side of the product (which in general is a very popular click position for most websites), indicates an approach in which traffic generation has been a driver of the design. Click thoroughs are all going via a Nextag URL to the destination product page and Nextag is seen in the product titles. This reads and looks like an affiliate website or a white label to me which is disappointing.

The other major question PriceMachine raises for me is whether this product has been made to become a traffic driver. I have been unable to find any innovations on PriceMachine with the exception of the sorting of products done by price by default.

CPC Strategy has described PriceMachine as a “New Price-focused Comparison Shopping Engine.” Unfortunately this reads more like a content re-purposing exercise.

So where does this leave Wize Commerce? Well, they will soon have another comparison shopping engine in their stable in the US. Is a second comparison engine in a saturated market a good idea? I don’t think so as an increases Adwords costs, human capital and technology costs. This capital investment could have gone into an acquisition or a feature for the popular CSE, Nextag. Is this also indicating that aggressive revenue generation is now a bigger factor for Wize Commerce? I was excited to see PriceMachine but this seems to be a move backwards by Wize Commerce.

I received the following feedback from Wize Commerce:

To begin with, it’s important to distinguish between our shopping networks (which are about providing good experiences for diverse customer segments all of which leverage our unified technology platform) and Wize Commerce as a whole (which is about multi-channel traffic generation and site optimization).  While we are a large Google advertiser (and also a large advertiser in Facebook, Bing, Yahoo, and on many display networks) we are not so large that we believe we significantly influence the Adwords Auction. Rather, we are focused on using our Shopping Network to attract shoppers with diverse interests, and on generating the highest possible conversion and ROI for merchants. As we progress our Shopping Network, this characteristic of our strategy will become more evident.

Also, you imply that we would be better off using our capital investments to drive acquisitions. Acquiring companies can indeed be beneficial to our stakeholders and over the last few years we have done just that. In the coming years, I believe we will do more. But acquiring companies is a lengthy process and some initiatives are better developed organically. We’re doing that too and we believe the blend of organic and acquired capabilities will ultimately prove to be beneficial to our customers.

Overall, as you allude to, Wize Commerce is about the platform – not about one site or one class of services for merchants – and our shopping network allows us to meet diverse user needs by using our platform, which we believe to be one of the most robust and innovative in the industry.

The bottom line is this is an exciting time for Wize Commerce. We’re growing our capabilities to compete in a much more complicated e-commerce world, we’re delivering real, measurable results for our clients, and we have a number of new, innovative offerings and services in the pipeline that will help us expand in the months and years ahead.