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August 15, 2005Interview with Talmadge O'Neill of Smarter.com
* Disclaimer: I have discussed a syndication relationship with Mezi Media regarding Coupon Mountain. Re: Promotional Information “If I was doing a search, and I only had the pricing information, and not the promotional information, I really wouldn’t have the best idea of where I should shop. That has really been the core thing that we have believed, which is that if you don’t have both the pricing and the promotional information, you are not really giving consumer the best information on where to buy. And given that our background is on the promotional side, we are coming at the shopping search space from a different angle.” Re: International Expansion “We built our engine, Day 1, to be double-byte, and to be portable to multiple markets. Rather than get to a point two or three years down the road where we say, okay, we’ve made it in the U.S., and now we’re going to launch internationally, and now we have to rebuild a completely different system, and we’ve got the currency conversion issues… we built it from day one to be portable, and we built in double-byte, which is necessary for Asian countries.” “The second thing I would say is, on the coupon side, before GoTo, I had spent practically my entire working career overseas, and many of the people we hired early on were not American citizens, but German or Korean or… so we actively looked for people with language skills. We felt that the U.S. market will always be more competitive, more difficult, ahead of the curve… but there are always opportunities to take what you learn in the U.S., and go into other countries and be a little bit ahead of the curve and establish a competitive footprint.” “While many other people have looked to Europe for their growth, we’ve had an office in China for two years, and we’ve had a coupon site in Japan for two years. We’ve got to the point where, while we are not insiders, we are certainly a lot more familiar with the environment, have built a lot of relationships with merchants, have identified where we get traffic, identified how you need to change your product to be successful in those markets. Those markets, from the U.S. perception, are very difficult to do, so we’ll be the first pan-Pacific player.” Re: China and Japan “There are some out there (in China). There are maybe six to ten that we are looking at, but no one has really made it into a business. In Japan, Kakaku.com is certainly in the lead, amazing amount of free traffic, they are publicly listed on the Tokyo exchange, their financials are very good, but it is still a fairly small operation, they are probably around fifty people. That is a market where it probably should be a lot bigger than it is, and other than Kakaku, on the independent side, there is not a lot there.“ Re: Category Emphasis “We started in the traditional SKU-associable categories like computers and electronics. We started in the categories that had more penetration, the categories that are genuine comparison shopping, where you have a product sold by many merchants. And we are rolling out what I would call the catalog side, or the shopping search side, where you have non-SKU-associable products. In August, we are launching Apparel, and in September, we are launching Home and Garden. I would think that in twelve months from now, we will probably have most of the major categories.” Re: Live Chat?!? “That is something that is still in Beta, but our idea here is that there are a lot of consumers who get to, say, a digital camera page, and they might have questions like, “what is the difference between a three-megapixel and a five-megapixel camera?” We are not quite up to 24x7x365, but we’re experimenting with providing live chat to consumers. Also, for merchants, we have a telephone number and people they can talk to. Before we launched comparison shopping, we talked to a lot of merchants, and I think one of their top complaints was that they could not get good customer service.” “I think we started putting it (live chat) up there intermittently maybe a month ago, and right now we are looking a the chat topics, and building a database of the most common questions and answers, and training up a team to be able to support that at larger volumes.” Re: How Many Shopping Engines? “I’m going to use a historical analogy of how in 1994 of how there was Altavista, and there were other people like Magellen and Infoseek and Excite, Yahoo was a directory, and Google only came around in 1998. There were a couple of cycles of “search is important” and “search is not important” and comparison shopping has been around almost as long.“ “My guess is long-term there are only 3 or 4 major shopping engines, but we’ve probably got another doubling or tripling or quadrupling of revenue by the time the market gets to the point where the engines are trying to take market share from each other. I think we are still in the period of the rising tide lifting all boats, but I would say we have not seen a lot of innovation in this space for the last couple years.” “I’m not sure if there is that much difference in MySimon in 2000 and a Shopping.com or Shopzilla today. Shopping.com and Shopzilla certainly say we are doing more products, and we have this new technology, and we return results in twenty milliseconds, but I don’t know from the consumer standpoint if there is that much visually that is different. I would guess that over the next couple years, the comparison shopping engines will grow, partially at the expense of general search, although general search will continue to grow. Everybody is going to do their own thing for awhile. We are going into Asia, some companies are going into Europe, other companies are getting into certain product or service niches. But then, whether it is 2007 or 2008 or 2009, there is probably either consolidation or there are some winners and some losers. Because at the end of the day, consumers are not going to remember five or six comparison shopping engines. It is kind of like the Jack Welch thing, where you have to be #1 or #2, because you need to be big in order to generate the revenues and margins to invest in products that are clearly differentiable.” + + + links - www.smarter.com | Smarter SMS | Company Information | Merchant Information p.s. - Brian Smith of ComparisonEngines.com also interviewed Talmadge recently, here.
Interview with Talmadge O'Neill of Smarter.com
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Smarter.com
