There’s search, and then there’s site search. One indexes the general Web and serves many consumers as a starting point for research into what they want, and the other helps them find that item on a Web site, and maybe cross-sells some other purchases in the bargain. Right?
Not exactly, at least in the case of Guidester, which blends attributes of both. Guidester’s navigational tool helps consumers find products on retailers’ e-commerce sites; but it also helps them decide which of those products are right for them. And it offers the makers of those products a chance to get out in front of the competition with auction-based featured listings—a form of pay-per-click advertising, done carefully and with respect for the integrity of buyers’ values.
For the first four years of its life, Guidester—then called “Decidia”– sold its merchandising platform outright to companies like Whirlpool and Lexmark, who used it on their Web sites. But the growing success of Google and Yahoo! in generating revenue from auctioning search ads persuaded Chin and company that there was a better business to be in than arms dealing, and in March Guidester began offering manufacturers the chance to bid on featured listings within the results it produces in response to filtering questions asked of the customer.
Now Guidester has deployed its hosted search application on Web sites such as HP.com, CircuitCity.com, CompUSA.com, TheMiamiHerald.com and Abt Electronics. The retail sites use the service for free; Guidester earns its revenue from the makers of the goods those retailers sell. (The company also announced
It works like this. Customers who come to the main site or to a product category page such as “digital cameras” find a discreet link, usually asking “Need help deciding?” or something else unbranded. If they click on that, they navigate to a page branded with the Guidester name and the categories appropriate for the retailer: in the case of compuUSA.com, camcorders, desktops, laptops, digital cameras and others. The users click on the product category of interest and go to a page that offers questions about them and their camera wants on the left, and a list of available CompUSA products fitting those parameters on the right. A counter between the two shows how many suitable products are available—to start with, 166 digital camera models at CompUSA.
Answering questions about what they’re looking for lets consumers whittle those choices to a manageable size. The questions include technical specs (“How many megapixels would you like? 1,2,3… etc.”), about price (“Would you like to spend no more than…”), and also lifestyle and psychographic factors (“Which statement best describes you: I prefer to buy the best technology/ I am most concerned about value/ Neither”). Guidester also asks for shoppers’ level of expertise as a shutterbug, what they value most (compactness, video capability or interchangeable lenses) and how the pictures will be shared.
Answering any or all of those questions brings that list of 166 models down to a useful scale. In real time, a buyer who specifies an easy-to-use camera for less than $300 faces a roster only half that size. The counter on the page reflects that change, and clicking on “Show results” pulls up a refreshed list of models fitting those criteria on the right side, with links to the models’ landing pages, prices, brief specs and images.
Guidester earns its money in the way those products are displayed: specifically, in the first four or five slots, which are labeled “Sponsored Match” and are the result of bids by the manufacturers for pride of place in the appropriate results.
Joe Chin, CEO of Guidester, stresses that these sponsored matches still fit what shoppers using the tool say they’re looking for. In that sense, they’re not like paid search ads, which marketers can simply buy for the price of a keyword. “Even when consumers fill out all the questions, they can still wind up with 20, 30 or 40 models that fit their descriptions,” he says. “We can display those in any order we want—alphabetically, reverse alphabet, by price or even randomly. So we just decided to let the manufacturers bid to have the results reshuffled so their products show up in the top sponsored slots.”
Guidester never offers more than five premium spots in any category for any retailer, and sometimes shows fewer or none. The retailers get to decide what order the non-sponsored listings appear in, in order to give them merchandising opportunities.
They also get a share of the revenue generated by the sponsored matches on their sites, at a rate that depends on the categories involved. Meanwhile, manufacturers pay only for those sponsored match positions, not for any lower listings. “We’re never going to exclude a product from a retailer’s list just because no one’s bid,’ Chin says.
That would be unhelpful to consumers and undermine their trust in the Guidester tool. As it is, Guidester says shoppers have responded well to its product search tools in all its e-tailing partners. The company points to surveys that say 86% of users found Guidester easy to use, and 79% found it helpful in choosing products. Eighty-six percent of respondents said they would recommend Guidester to shopping friends.
“We have three constituencies here that we’re trying to help,” Chin says. “We have to make sure that it works well for the user, and based on our studies, it definitely does. We have to be sure that it helps the retailers, which goes with helping consumers because if they can find products easily they’ll convert at a higher rate. We typically see conversion rates double with Guidester. And that’s our value for the advertiser—that we can offer them the most targeted product marketing on the Internet.”
“We’re the only company offering this right now, which makes us the only way for manufacturers to reach these very qualified buyers across a network of e-tailers.”
One complication is that while Guidester maintains a large database of product brands and models in 15 categories, from consumer electronics and office equipment to fitness and outdoor gear, that database must be redacted to fit only the categories a retailer offers and only the models sold. For example, Guidester may know about 1,800 television models; but CircuitCity.com will only get 150 or so of those listings, because that’s their product scope.
While the Guidester platform has made its deepest inroads in the consumer electronics and computer categories—one of the most recent deals was with camera and electronics e-tailer Abe’s of Maine– Chin doesn’t think it will take too long to spread the tool to softer products such as financial instruments like mutual funds, health plans, baby products, wine and travel.
“we’re following an ‘Intel Inside’ branding program,” he says. “We want you to remember that Guidester helped you find your computer, so that when you go looking for a cell phone or eventually a car, you’ll trust us to help with that choice too.”
And the rollout to other categories will get a boost from Guidester’s recently-concluded initial round of venture funding, which produced $3 million in capital investment. “We expect to march pretty aggressively through another 40 categories by the end of the summer,” Chin says. Just in time for the opening bell of the holiday shopping season.