June 26, 2006, 12:00 AM

Merchants bid for position on new shopping engine based on cash returned

Merchants pay for listings on Jellyfish.com’s new comparison shopping engine based on sales, not click-throughs. Jellyfish shares a percentage of the fee with the shopper in the form of cash.


A new comparison shopping engine launches this week with a bow to the affiliate marketing model: online merchants pay Jellyfish.com per sale, not per click-through. In another twist, the destination shopping site is attracting consumers by sharing a percentage of the fee it receives from its merchants for sales directly back to shoppers in the form of cash.

Approximately 1,000 merchants and manufacturers are participating in the beta version of the engine that launched this week, with an offering representing more than 5 million products in dozens of product categories. Shoppers who buy from a listing on Jellyfish enter the merchant’s site through a special landing page that allows Jellyfish and the merchant to track whether that shopper actually winds up purchasing through that entry point.

The purchaser pays what’s listed on the engine as the total store price, but when a purchase is completed, Jellyfish shares at least half of the commission it receives from the merchant with the shopper. The amount the shopper will receive is shown prior to purchase, and when the purchase is completed, that amount goes from Jellyfish into an account the shopper has set up with Jellyfish. The share-back is in cash, which the shoppers can redeem via PayPal or other means as the accumulated funds in the account reach defined increments.

Merchants bid for position on Jellyfish’s engine, and they achieve high rankings based on how much cash back they are willing to provide. Basically, it’s a competitive bidding environment where merchants bid for position with ad dollars to lower end prices. The same kind of advertising auction occurs daily at major PPC search engines, but those engines keep all the revenue generated by that activity, according to the company.

“We think the Jellyfish.com model represents the future of online advertising,” says Mark McGuire, president. “This is the major shift we are making at Jellyfish: turning advertising dollars into added customer value. Instead of price per click, we call it value per action.”

A full launch representing a planned expansion on what is now the beta version of Jellyfish.com is expected in the fall.


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