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People Comparison Shop, Stupid

People Comparison Shop, Stupid

If you think people might buy your products or services without checking out the competition first, think again.

Research says that on average consumers visit three websites before making a purchase. Another insight by the same study was that the more sites a consumer visits, the more money they are likely to spend. In other words, the more expensive the product, the more time people take to comparison shop.

More and more consumers are savvy enough to understand how to compare options, and they look at other places where they can buy the same or similar goods. Even if they want to buy stuff in retail outlets, 83% of U.S. consumers go online to research electronics, computers, books, music and movies before buying those items in bricks-and-mortar stores.

Product category matters. When it comes to people shopping for smart phones for instance, 72% of shoppers considered 2+ cell phone models and 57% visited 5+ different brand sites before purchasing (either OEM, retailer or carrier). They also took their time researching, with 60% of online shoppers starting their research 2+ weeks prior to purchase.

A study by the e-tailing group concluded that consumers are invested in finding the lowest price:

  • 94% of online shoppers invest time to find the lowest price for commodity products
  • 36% spend 30+ minutes comparison shopping before making a decision on purchasing a commodity product; 65% spend 16+ minutes doing so
  • 51% visit 4+ sites before finalizing a purchase
  • Efficiency of price comparison and the ability to merely Google it, check Amazon’s prices or visit a few competitors is core to current consumer shopping behavior
  • TCO (total cost including shipping and handling) and product price are the two most important influencers for online purchase decisions
  • 58% would expect all retailers of commodity products to incorporate a kind of onsite comparative pricing tool into their shopping experience,

People want better product information

study by Oracle reveled that people want above all more detailed and visual product information (37%), better search (29%), and easier access to a customer service representative via live help options such as click-to-call or live chat (20%).

This is especially important if you market to men. A study on gender differences concluded the following:

  • Males and females differ in how they utilize a product page. Males intensely research the page, viewing all the product details and pictures, while women quickly scan the product page and go to the next product they want.
  • Males tend to search by product while females search by brand.

Newegg competes in a very difficult market. Their advantage over the competitors is that they don’t solely rely on manufacturer product information, but write their own sales copy for each product. Providing better product information is how they manage to stay in business while competing with giants like Amazon, Walmart and Best Buy.

Do this: Gain advantage over your competition with better, more thorough product information

Compare yourself with the competition before they do

Fact #1: People do their homework before purchasing a product or service.
Fact #2: People are lazy.
1+2=compare yourself with the competition before they do.

When comparing options, people usually only look at the most obvious things like price and key features. For example when choosing a web host, they look at the server space and monthly fee and that’s it. You – as an expert in your field – know that many other things should be considered and perhaps your advantages are less noticeable at first.

In order to combat this you should compare your offering to the competition on your own website, so you can point out the things you feel are your biggest advantages over the alternatives. If your product is more expensive than others, then this is your chance to explain why. If some of the specs are lower compared to the competition, point out that maybe your support is way better or you provide personal consulting or its more green or whatever.

This is how InMotion Hosting is doing it:

This is how SugarSync does it:

Won’t the customer now find out my competitors?

If you think they don’t already know them, you’re naive. So let’s say you keep on being naive and won’t include the comparison on your site. Then what?

They go to your competitor’s website anyway. Now imagine if your competitor is openly comparing your services and making it look like their offer is superior. What will happen? A large number of people will take that competing offer.

Research says clearly that people visit on average 3 websites (means some do a lot more) before making a decision. Having a comparison table can keep people from leaving your website. They can already do the comparison on your site, so why leave? It won’t keep all of them on your site, but you’ll definitely win over a good portion of visitors.

Service 1 vs service 2

This is a common way how people compare services – they google it. Bluehost vs Hostmonster. Ducksboard vs Geckoboard. You get the point.

If you’re smart like Vzaar, you plan for it and create dedicated pages for these comparisons.

If you google “vzaar vs viddler”, this is what you’ll see:

That’s right. Number 1 result in Google is a page created by Vzaar itself. It looks like this:

If you search for “vzaar vs vimeo”, you’ll find a page for that ranking #1 again. It looks like this:

Do this: Figure out which competitors your customers are most often comparing you against (you can do this by typing “[your service] vs ” and seeing what Google offers) or which competitors you want to be compared to, and create a dedicated page for those comparisons. Approach those pages like landing pages for a specific customer persona (comparison shopper). Make sure the on-site SEO rocks, and you should be good to go.

Apples to apples or apples to oranges?

There are 2 schools of thought. One says that since customers comparison shop, you should make it easy for them to compare. So you structure your product or pricing page in a similar fashion to the competition.

Another school of thought is that you should intentionally make it difficult to compare, so they’d spend more time looking into your product.

Here’s an example. Compare these 2 competing products and tell me which one is cheaper (you have 5 seconds!):

It’s pretty difficult to figure it out, and here’s why:

  • their pricing plans do not match – they compare different number of monthly visitors
  • the last example shows 10% off prices by default (which you only get if you pay a year up-front)

So what will the user do? A) take our the calculator and calculate cost per 1000 visitors or something, or B) pay more attention to other things besides pricing.

Do this: Create a page with easy-to-compare plans and a page with difficult-to-compare pricing plans. Test them (of course, the results will not only depend on the competition, but a myriad of other factors).

Should you show competitor’s prices on your site?

Since everybody always wants to know the prices – perhaps you should, especially if you sell commodities. For things people buy all the time (e.g. batteries, beer, jeans) they already have a pretty good idea what’s a good deal. But not always, and not for things people buy online.

A study exploring why exploring why consumers leave websites before buying found that the second most common reason for leaving the site before buying was “I was not sure that the site provides the best price”. Parago Shopping Behavior Survey from Q1 2012 said 70% of consumers are more price sensitive than they used to (due to economy etc), and 96% shop for the best price for things they need.

This means that you’re more likely to get the sale if you manage to instill confidence to prospects about your price.

You can experiment with

  • ‘best price guarantee’ type of promises,
  • drumming up the value of your product,
  • using urgency,
  • emphasizing the extra value they get if they buy from you (and not the competition),
  • free bonuses / gifts to go with the purchases,
  • or even showing openly how much your competitors charge (most suitable if you’re competing on price).

Scan Cafe features prices of their competitors on their site:

Furthermore, shoppers positively perceive a retailer that shows competitors’ prices on their website – as convenience, complete information, and time savings are important to their online experience. 78% would be likely to return to a retailer that shows competitors’ prices on their website. 53% of consumers would no longer feel compelled to comparison shop elsewhere if merchant would feature prices of their competitors.

People check competitor’s prices even offline – 34% of in-store consumers compare prices on mobile devices. Another study backs this up and says it’s mostly iPhone users that do so.

Listen in on social media

Another common way people comparison shop is by asking around in social media. Whats the best software for X? Is there anything better than Y? Has anyone used Z? These types of questions are posed by people seeking validation and insight from their peers.

According to a study 47% of respondents look to other social media users when considering a home furnishings purchase, and 25% seek advice on social networking sites when contemplating an apparel purchase. According to the data, 32 percent of social media users say they have recommended a product/company to a friend through a social networking site.

This is a great opportunity for you. Monitor relevant keywords on social media platforms like Twitter, Facebook and LinkedIn, or monitor related topics on sites like Focus or Quora to find people who might be looking for what you sell. Once you find them, make a case for your product or just inform them.

When I used to work on Traindom, we did that all the time and stole lots of customers from people unhappy with our key competitors. Most of them weren’t even aware that we exist, so it was a great way to market our product.

Entrepreneur Magazine has a story of how someone looking for an iPad case sent out a tweet:

“Looking @DODOsays iPad cases–and *this close* to pulling the trigger … Any opinions out there?”

As it happened, there were. Matt Winslow, co-founder of Dodo competitor Beacon Cases in Raleigh, N.C., fired back a suggestion to check out his product. In a subsequent e-mail, he discussed pros and cons of various cases and particulars of Beacon’s unique “tab and gate design”.

So have somebody in your team monitor social media real-time, so you could add your product to their comparison. Here’s a list of free social media monitoring tools.

What’s the main motivation for people seeking out opinions online?

A study looked into it and found that these are the top reasons:

  • reduce the risk of bad purchase they will regret,
  • find the cheapest price,
  • it takes too much time to research,
  • to appear cool and build relationships with peers.
Knowing this will help you to plan your angle when you approach people on social media.

If there’s no difference, people will choose based on the price

Remember: if your product is not unique, you are always going to compete on price. If there are no significant differences between your product and competing products, people will choose based on price. If the product is the same, why should they pay more ?

That can work to your advantage.

The most proven pricing strategy in a competitive market is doing it cheaper than others. People like to get stuff cheap. This is often the best strategy to choose if your product is very similar to the others in the market.

Do this: 

  • If you sell commodities, see if you can offer the best price on regular basis.
  • If you can’t win price wars (most small businesses can’t), you need to focus on the extra value you add in your offer (store warranty, free shipping, free installation, bonus gifts etc).

Reduce barriers to first purchase, make it smooth for future purchases

If your business model relies on regular repeat purchases by the same customer (e.g. you’re not selling real estate or pianos), there are 2 things you must do.

1. Incentivize first purchases. The hardest thing in ecommerce is winning over people who’ve never bought from you. They are unsure about your trustworthiness, the level of service and wary about unexpected hassles. You have a significant disadvantage compared to stores where they have shopped before. In order to overcome this, you need to compensate with extra incentives. You can do it by

  • offering free shipping (at least for first-time buyers),
  • giving a coupon for first-time buyers,
  • beefing up on credibility elements,
  • minimizing their anxiety and pain by asking as little details (minimal number of form fields) as possible when buying,
  • reducing friction by having an on-page FAQ to address common fears and doubts,
  • making sure your product copy leaves no question unanswered (50% of purchases not completed due to insufficient information),
  • not forcing them to  sign up (you can create an account for them automatically based on their email address + autogenerated password)

2. Make it convenient to do repeat purchases

I personally buy more stuff from Amazon than from anywhere else. Besides them having my full trust, the best selection (in most cases), lots of reviews and good prices – it’s about convenience. My credit card (3 of them, in fact) data is stored there and buying stuff that I need is easy – I don’t have to type anything.

Here’s how you can make repeat purchases convenient

  • Keep people logged in so they don’t have to log in each time,
  • use persistent shopping carts (contents of shopping cart never expire or not before 60 days),
  • store their shipping and billing information.


So what’s a marketer to do?

  • Acknowledge that people compare options, and plan accordingly.
  • State your case as good as possible, provide adequate product information.
  • Help them do the comparison by having comparison tools on your site.
  • Make sure their comparison research will result in them understanding what your advantages are and why they should buy from you.

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Join the Conversation Add Your Comment

  1. Great article Peep, a very comprehensive assessment of the ‘journey’ consumers now take when purchasing online. The typical conversion funnel is almost obsolete as people exit and return to the funnel at will.

    1. Peep Laja

      Thanks Matt! I think you’re right. The funnel does still work in some occasions (single, unique product, pre-existing relationship etc), but is much less common than it was a few years ago.

    2. Wow. This is an awesome post.

      “The typical conversion funnel is almost obsolete as people exit and return to the funnel at will.” – Matt

      “The funnel does still work in some occasions (single, unique product, pre-existing relationship etc), but is much less common than it was a few years ago.” – Pepe

      This an excellent observation. I often found myself coming back to buy from a particular seller days or even weeks after first landing on their page or after entering the email campaign. Going in and out of the funnel is certainly more common today. Any other recommendations on strategy when developing a funnel that has less “leakage” so to speak.

      And do marketers who provide services such as conversion or content marketing consulting need to worry about the comparisons as much as commodity product sellers.? My guess is no.

    3. Peep Laja

      Thanks Martin.

      Everyone needs to worry about comparisons. Yes it’s easier if your product / service is unique, but there are always alternatives to what you offer – and you need to build your case why anyone should buy from you and not the competition.

    4. Wow. This is really good stuff. I am going to implement all your excellent recommendations on both my websites. Keep your golden nuggets coming please!!

    5. Peep Laja

      Thanks. Let me know how it plays out.

  2. Overall, an excellent look at customer actions. I am definitely going to start creating articles with competitor comparisons. Again, you have created a real resource. Thank You.

  3. Another great post Peep. I was only look at the pricing pages for Otimizely and VWO just the other day and thinking along the same lines. It’s impossible to compare them on price which I guess is the point.

    I’m working with a new client at the minute in the online training space and there’s very little to differentiate between other providers apart from price. Thanks for the article, it’s made me think about the right things just at the right time.

    1. Peep Laja

      Yeah, I’m wondering whether it’s a sort of a cartel agreement :)

  4. Thanks Peep loved this post! Great section on “Should you show competitor’s prices on your site?”

  5. Great stuff as always, straight to the point.
    Whitch one is better: 105 with free shipping or 99 + 6 for shipping?
    A quick look would suggest 99 as cheaper but as it would turn out sooner or later for the buyer, it’s not. Then again, 105 could be immmediatly dismissed in a site-hopping comparison, if the free shipping is’t very clear.

    1. Peep Laja

      Definitely – and this is why comparison tables are important on your website – you can choose which information you show and how.

  6. Thanks for this very comprehensive blog post Peep. I am wondering how this compares to a professional service product (i.e. service) which is typically sold on perceived value rather than price.

    1. Peep Laja

      Service products have always alternatives – other companies offering similar or identical services. So differentiation and unique value proposition are critical to get the prospect to choose you.

  7. Great article! I’m forwarding to my staff to consider modifications to our website as well as to my fellow business associates to help in theirs! Thanks, Peep!

  8. Excellent post Peep, now it’s posts like this that make me thankful that I found your blog..which was by fluke really. Love it…excellent info.

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