I’m convinced that the emergence of product search engines is having an affect on the value of brands, and thus creating opportunities for smaller players to succeed.
Consider air travel. Eight years ago, when I wanted to fly from San Diego to Boston, I was pretty internet savvy, and would go online to buy my ticket. The online travel agencies (Orbitz, Travelocity, etc.) were an option, but they were not perfect for two reasons. First of all, there was a lack of transparency in the pricing. If you booked an American flight through Orbitz it could cost more than if you booked it through American Airlines website directly. Second of all, there were a few airlines that were not included in the search -most notably Jet Blue, that had reasonable prices and (at the time) great service.
As a result, when I went shopping for a plane ticket, brand mattered a lot. It was the brands that I could remember off the top of my head that I was drawn to first.
I’d check American Airlines website, check Jet Blue’s website, and then make a decision.
Enter Kayak. Kayak was the first vertical search engine for flights that I became aware of. It covered all the different carriers, and its pricing was transparent because you purchased your ticket from the airline directly. My new process for buying a ticket is simple. Go to Kayak, enter the desired dates of travel, and see what the options are. Being price conscious, I often just go for the best deal. If two flights are virtually the same in terms of travel time and cost brand might by the tie-breaker, but generally speaking I don’t consider brand as much. Kayak organizes all the information in such a comparable way that i can pick the product best suited to my needs.
Fine. What’s so interesting about this? Analogous to Orbitz are sites like Zappos and Endless, and analogous to Kayak are sites like Shopping and Pricegrabber. Shopping.com and Pricegrabber are true vertical product search engines that send a shopper to the suppliers website to make a purchase, providing pricing transparency, while Zappos and Endless sell you the product directly.
I predict that Product Search Engines will improve over the next few years. They will cover a broader range of sources and they will present the specification of their products in improved ways such that it is easy to compare products and make the best purchase decision.
For example, in the future, if someone is searching for a leather bag, they will be able to go to a Product Search Engine focused on bags, and know with confidence that 99% of bags for sale on the internet are included in their search results. Furthermore, an improved interface will allow a customer to filter based on the specification of bags. If you only want black, you can filter out everything else. If you want a briefcase style, you can look only at those as well. Only gold plated zippers, no problem. Vintage finish to the leather, done. In the end, we will have narrowed our options to a few products that meet our exact criteria, and ultimately be able to make an informed buying decision. As before, if you end up with two bags that are equal in every way, with the exception that one has a brand you like and the other does not, the brand may still win out. The brand is ultimately less important though, because you were not looking at the product because of its brand, you were looking at it because it met your product criteria
This will be a major shift from how things are today. If someone wants a product today, they go directly to the brick and mortar store of the brand they know for producing that product. In the store, they are captive to see only products from that brand. For the online shoppers, they do effectively the same thing, going directly to the websites of the brands they know.
Bottom line: I’m excited about this, because I think it will open the door for new product companies without a lot of brand cache to compete against the major brands simply by offering quality products that meet consumers expectations and needs for a reasonable price.
Tagged: Brand, Kayak.com, Pricegrabber.com, Product Search, Vertical Search