‘Tis the season!

For e-commerce stores, that simply means being aware of the annual tradition of comparison shopping engines hiking up their costs per click. In an effort to capture a bit of their own holiday glee, CSE’s like Pricegrabber, NexTag and Shopzilla raise their rates by as much as 25%.

How does that work?

Cost Per Click – Bid Model:

If you list products in NexTag, under the TOYS category, your normal minimum bid is 25 cents per click.  During the holiday shopping season, NexTag increases their pricing by 25%.  So the new minimum cost per click is 32 cents per click.  Now, you may not be affected by this at all.  If the bids you set on your products already start higher than that minimum bid, you may not feel any difference in spent budget.  However, the increase in minimum cost per click does bring lower positioned competitors higher on the results page.  Be aware and adjust accordingly.

Cost Per Click Flat Rate Model:

With this model, your total cost will go up.  If you are utilizing Pricegrabber, you pay a flat fee per click, based on the category your products are in.  With the application of the 25% holiday rate increase, you will see your costs rise.  For example, if you have products in the TOYS category and your normal price per click is 75 cents per click, you will be paying 94 cents per click for each click.  So your budget will be depleted quicker and your products could go offline earlier.

Some Good News:

There are several comparison shopping engines that are breaking with tradition and NOT increasing prices this holiday season.  They may have other specials to note though.

Here is a breakdown of the rate increases by major engine:

• Runs from 11/4/2009 through 1/06/2010
• 25% increase.  All categories

• Runs from 11/1/2009 through 1/15/2010
• 25% increase. All subcategories

• Runs from 11/02/2009 through 12/29/2009
• 25% increase. All categories.

• Runs from 11/16/2009 through 12/27/2009
• 0% to 25% increase, based on category.

• Runs from 11/15/2009 through 12/31/2009
• 0% to 20% increase, based on category.

• Runs from 11/01/2009 through 1/01/2010
• 20% increase, All categories.

• NO INCREASE
• Add a Logo 1/2 off – Entire month of November.

• NO INCREASE
• Contact for special placement pricing.

• NO INCREASE
• (Hard to beat FREE)

Some of these have already kicked in.  There are two watch points for you, if you have products listed in the comparison shopping engines.  First is that you will spend your budget quicker and should monitor your spend closely to ensure your products do not experience down time as a result.  Second is that rate changes cause a scramble for bid placement.  Keep your eye on the listings to ensure your are in the position you want to be in.

Have a great season!

I’m Linda Bateman and I’m here to help.