What Business Networks can learn from Comparison Sites
Everyone loves a good deal. So it’s hardly surprising that price comparison Web sites have really taken off. Travel sites such as Skyscanner allow holidaymakers to compare flights, hotels and car hire. In the U.K., where energy inflation is the highest in Europe, uSwitch attempts to simplify the impenetrable world of gas and electricity tariffs, as well as broadband, and mobile call plans. As the name suggests, it encourages consumers to switch their loyalty away from providers that are uncompetitive or failing to satisfy. When it comes to financial products, two of our most popular comparison Web sites (Go Compare and Compare the Market) are as well-known in the U.K. for their irritating TV adverts (featuring a fictional Italian opera singer and an implausible family of Russian meerkats respectively), as for their ability to find cheaper insurance.
These portals can not only save consumers valuable time in filtering and evaluating an infeasible number of sellers, but they are also widely regarded as reliable sources of information. What’s more, comparison shopping agents (like Epinion, for example) provide extensive consumer feedback and ratings, helping buyers to further refine and inform their decision based on user-generated reviews. Some are signatories to accreditation schemes that provide quality assurance that the information is accurate, impartial and comprehensive. This level of transparency and accessibility was unthinkable only a couple of decades ago.
So what’s in it for the sellers? Comparison engines are great for retailers and service providers because they get the opportunity to attract new customers, increase sales and distance themselves from their competitors. Price comparison engines can collect data directly from merchants who want to list their products on the site (and pay for this service, which is how the site is monetised). Other techniques include screen-scraping (crawling retailers’ web pages to retrieve published prices) and crowdsourcing, where contributors’ information is used to populate or enrich the data set. And of course, the whole thing is orchestrated using sophisticated algorithms that would be beyond the reach of many individual organisations’ IT budgets.
Business Networks work on a similar basis. With 77% of best-in-class companies using the internet as a sales tool, buyers have more choice than ever before to help them cut costs and mitigate risks. Networks are now available that can standardise data, overlay robust analytics and present results in an easy-to-understand format, making it easier for buyers to discover suppliers and evaluate performance, pricing and other credentials such as environmental ratings. In fact, 68% of buyers find sellers on supplier networks, so you really do have to “be in it to win it”.
Sellers, meanwhile, get to strengthen their online presence without blowing their marketing budget and become a preferred supplier to purchase-ready buyers worldwide. They can identify customers of choice who are easier to do business with, meaning they’ll get paid faster with fewer errors. Such networks can make the working relationships between buyers and sellers more mutually supportive and responsive, enabling smarter buying, faster selling and better cash management. A great example of symbiosis, and not a single annoying, small furry animal in sight.