A sea of shoppers

Spearfishing vs. casting a wide net: Search marketers try out niche search engines

A shopper is looking for blue jeans. At a shopping mall she sees two large stores—one with limited sales staff with only a broad understanding of what they sell and another with associates who’ve cleared the entire shop of everything except blue jeans and are ready to determine precisely what kind of jeans she wants: fit, style and price. There, the shopper quickly is presented with a choice of three pairs of jeans that meet all requirements, and she’s so elated she whips out her credit card and decides to buy all three.

Shoppers of course would prefer the store where it’s faster and easier to connect with what they want. The same goes for retailers looking to connect their products with customers. Now change “store” to “search engine” and the result is the definition of vertical search.

These category and subcategoryspecific online product search sites are dedicated to shopping and product search, in contrast to general search engines that also offer the opportunity to search out other kinds of information.

As such, they focus product search more sharply than do product search options at general search engines. For example, there really is a search engine dedicated to women’s jeans, Zafu.com. FindGift.com focuses on—you guessed it—finding gifts, while Bookfinder.com is dedicated to books and Spafinder.com to searching for the perfect spa experience. And there are many others.

The more niched the vertical product search engines are, the less traffic they get. But how much does that matter if the traffic they do get is extremely interested in buying what the vertical engines help find? A growing number of marketers are out to answer that question, experimenting with a similarly growing number of vertical product search engines.

One merchant satisfied with vertical search is CowboyChuck.com, an online retailer of framed, personalized cartoon art. After buying keywords on other search engines, president and cofounder Michael Brown experimented with listing products on FindGift.com.

“For our product and our situation, it outperformed everything else combined,” he says. One key: thumbnail images of the art integrated into search results on the engine. Though Brown still buys keywords on Google, the cost of clicks on FindGift.com now represents the majority of his marketing spend.

It’s no secret online retailers are looking for alternatives to augment paid search campaigns they run on large search engines (see story, page 150). “Most advertisers in general are concerned about the rising cost of keywords and they are looking for a way to improve the ROI of their campaigns. One of the primary ways they do that, according to our Search Engine Marketing Executive Survey, is to focus on expanding campaigns to multiple engines,” says Kevin Heisler, analyst at JupiterReseach, a firm specializing in the impact of the Internet and emerging technologies on businesses. “It’s a natural evolution for companies to start targeting more narrowly the visitors that might be looking for what they offer.”

A seller of wind chimes, for example, has a highlyspecific target audience. “With a niche audience, it’s not about the amount of traffic you are going to get, it’s about the customers you are going to get,” says Matt McMahon, vice president of products and services at search marking company Fathom Online. “So if you buy keywords on Google, even though Google has hundreds of millions of queries each month, there are not going to be that many queries on wind chimes. Your audience is as big as your category.”

Comparison shopping engines such as Shopping.com and Shopzilla represent a first cut in separating shoppers from the larger universe of web searchers. But these shopping engines still are broadly populated with products, which opens an opportunity for targeted search vehicles that go even deeper into segmentation. As a result, there are more search engines than there used to be. According to Heisler, “Search engines have seen the opportunity to carve out niches that have essentially never been explored before.”

To get into vertical product search engines, retailers generally provide a feed from their product database to the engine. They pay fees to the engine on clickthroughs or in some cases on sales to referred traffic. Retailers generally don’t bid for positions within product listings, which most often are ranked according to criteria such as search relevancy and popularity. Beyond product listings, a few vertical engines also accept sponsored payperclick ads from third parties, which are delineated from the product listings.

Reaching more shoppers

For retailers participating in search on the major engines, vertical engines are positioning themselves in part as a way to capture customers the retailers might not otherwise reach.

“People are becoming more sophisticated in the way they search for information and in how relevant they want it to be the first time around. We have data that tells us there is a segment of customers who are going to make their shopping decisions through a vertical search engine, and it’s a segment we feel is growing. If you want to reach that audience you are going to have to participate in the opportunities offered in vertical search,” says Matt Greitzer, national search lead at search marketing services company AvenueA/Razorfish.

Even Amazon participates in vertical search on Bookfinder.com, which populates its engine with data feeds and other methods of gathering product content. The vertical engine collects a fee on sales from the traffic it drives to retailers. But why does Amazon, whose own URL is handsdown the bestknown among online book buyers, need a niche engine such as Bookfinder.com?

“Nobody doesn’t want more sales. Working with Bookfinder.com is a great way for booksellers to get incremental sales they would not have been able to get from another source,” says Bookfinder.com founder and CEO Anivran Chatterjee. Besides having a broad base that includes market segments such as textbook buyers and highend collectors who might not look first on a general engine, Bookfinder.com’s engine has large base of international users. “We manage to channel a lot of international sales to our American booksellers, and vice versa,” Chatterjee says.

Vertical engines also claim to deliver more highquality traffic. Greitzer compares the quality of traffic delivered to a retailer from a firsttier shopping engine such as Shopzilla to that which a merchant would get from a major general search engine. “Where it starts to get interesting is if you really dive deep,” he says. “The microniched verticals are a really appealing category. I don’t think it has scale yet, but it’s one that’s interesting to watch. Some search engines we see really try to narrow the content. The people searching on Zafu.com, for instance, are more qualified as jeans buyers than the people searching for jeans on a general engine.”

Besides narrowing content, vertical engines also attract shoppers and facilitate purchases with added services to make choice even easier within their given niche. Zafu.com’s jeans finder feature asks searchers questions about their body type and preferences regarding fit and sizing.

Algorithms built into Zafu’s engine match the shopper’s profile to information on jeans in a database that stores information on the cut of different models of jeans. Information on the price and availability of specific models of jeans at the retailers who carry them is delivered to Zafu’s engine via data feed from affiliate networks such as LinkShare. That allows jeans shoppers who’ve already narrowed the field based on fit to further narrow results by conventional search filtering parameters.

Archetype Solutions, whose technology powers custom clothing applications on LandsEnd.com, also is the company behind Zafu.com and its jeansfinding software. According to CEO Robert Holloway, a Google or a Yahoo tells shoppers—among millions of other things—they can get jeans from this store or that store. But not only is Zafu all about jeans, it also gives searchers more of the information they need to make a purchase than they get on a general search engine. “The fundamental difference is that Zafu delivers a really qualified consumer, where conventional search does not,” Holloway contends.

Zafu doesn’t track through to sale, collecting instead on clickthroughs as well as thirdparty ad sales. But Holloway says retailers tell him traffic is converting well and that Zafu, which started by buying jeans to ascertain their fit, is now deluged by manufacturers and retailers sending them for free to ensure their brands get into Zafu’s search engine listings.

In the six months since Zafu.com launched, more than 1 million women have used its jeansfinding engine, many of them on a cobranded site offered as a service on Shopping.com. Visitor traffic is growing about 25% per month, Holloway says. This summer, Zafu plans to launch similar fitfinding engines for plussize women’s jeans and for bras.

FindGift.com is another vertical search engine that wraps recommendations around basic searching and sorting features. “If people are looking for a digital camera, they already know what they want and they’ll do a keyword search on it,” says Bob Zakrzewski, president and cofounder. “With giftgiving, people don’t have a clue, so you have to invert the search process. Rather than asking them what they want, you have to kind of interview them about the recipient and then start putting intelligent choices in front of them.”

FindGift also makes it easier for shoppers to come back and buy again the next time they need a gift with a saved gifts feature. As shoppers browse gifts and categories, they can save any products that interest them into a file that’s there the next time they return. As a giftgiving occasion draws near, they have a record of the items they’d previously noticed. The system also can see the gifts saved and suggest similar ones from the database.

Gifts galore

FindGift.com, with 2,000 product categories and more than 40,000 SKUs from over 1,000 marketers in its engine, takes data feeds from retailers. Human editors look for what catches their eye and the system gets the products into the right categories.

FindGift.com has operated on a PPC basis since 2001 after experimenting earlier with other business models. It’s a flat CPC rate of 11 cents to 20 cents per clickthrough depending on volume. Rather than a bidding system to maintain position within category search results as in Google and Yahoo’s paid search programs, product listings within categories are ranked according to popularity. Each night, FindGift’s engine reviews data from the previous day, recalculates and reorders the listings.

For retailers, Zakrzewski says PPC advertising on FindGift.com is typically more costeffective than advertising on a general search engine or a shopping search engine.

“For a lot of the common gift categories, Shopping.com may range from 15 cents per click on the low side to an average of about 25 cents a click, and upwards of maybe 50 cents a click for jewelry and watches,” he says. On FindGift.com, conversion rates support an average return of $8 to $12 for every dollar merchants spend with the engine, he adds, with more established retailers and brands coming in at the higher end of that scale.

But it’s not always the case that vertical search vehicles are less expensive on a costperclick basis than larger general search engines. “Niche engines could have a higher price because they do have a more targeted audience. So we focus our clients not on the rate they pay but on the return they receive,” Fathom Online’s McMahon says.

Niche newbies

Greitzer notes the launch of a number of niche search engines over the past 12 to 18 months, spurred by marketplace opportunity. Not surprisingly, some are more effective than others. CowboyChuck.com’s Brown, for example, though pleased with his experience on FindGift.com, has gotten little or no response from campaigns on other gift engines.

“It’s relatively easy to build a search engine. But it’s hard to build a good search engine,” JupiterResearch’s Heisler says. “The development is complicated, and they tend to reply for the most part on merchants providing some type of feed. So they have to have an application programming interface that works. It’s not too easy overall to create a userfriendly experience, and one that works for both merchants and consumers.”

Whether an engine provides a customer experience on par with what shoppers have come to expect at larger and more established engines is but one question marketers should ask themselves when exploring niche engines, experts say.

Another question relates to the tradeoff of volume for qualified shoppers. That’s a key premise in the value proposition touted by vertical product search engines. But, strategically speaking, does shrinking the audience down to only the most qualified prospects offset the far larger number of potential customers to which a product is exposed on major general engines?

Nope, consultants say. “We use vertical search engines in the retail space as a component for incremental volume,” Greizter says. “The majority of our clients’ advertising budgets are still going toward the major search engines. But we are recommending, especially for clients in categories like retail where there is a developed set of vertical engines, that clients explore those as well.”

Perhaps the best advice for retailers considering vertical search marketing is to revisit something they already know about when adding any new initiative: the importance of testing before jumping in, and being able to analyze test results. “Traffic isn’t really what is going to help marketers with their goals—they need to understand the revenue return they get based on what they spend,” McMahon says. “The smartest thing to do before anyone makes any buy is to have tracking and analytics in place to be able to evaluate return.”