Why Shopzilla's Business Model is so successful?
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Shopzilla’s Company Overview
Shopzilla, Inc. is a leading comparison-shopping service based in Los Angeles, California. The company's mission is to enable shoppers to quickly and easily find compare and buy anything, sold by virtually anyone, anywhere. Shopzilla's robust shopping search engine algorithm sifts through millions of products from thousands of retailers to match shoppers with the best product for their needs at the best price. Founded in 1996, Shopzilla serves shoppers and retailers across North America and Europe, providing reviews, price comparison, and other relevant information on a wide range of products including electronics, clothing, household goods, and more.
Business Model:
Shopzilla operates on a performance-based marketing business model. The platform acts as a bridge between retailers and consumers, providing the former with a platform to showcase their products and the latter with an easy way to compare and buy products. Retailers pay Shopzilla to list their products on the platform, and Shopzilla uses its proprietary search technology to match products with consumer searches. The platform also offers a suite of marketing services for retailers, including targeted advertising and customer insights.
Revenue Model:
Shopzilla's primary revenue model is cost-per-click (CPC). Retailers pay Shopzilla every time a shopper clicks on their product listing, regardless of whether a sale is made. The amount retailers pay per click is determined through a bidding system, where retailers bid on keywords related to their products. The more a retailer is willing to pay per click, the higher their products will appear in Shopzilla's search results. The company also generates revenue through its targeted advertising services, where retailers can pay for premium placement on the platform and for ads that are shown to specific demographics.
Headquater: Los Angeles, California, US
Foundations date: 1996
Company Type: Private
Sector: Consumer Services
Category: eCommerce
Digital Maturity: Digirati
Shopzilla’s Related Competitors
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Shopzilla’s Business Model Canvas
- Publishers
- Advertisers
- Retailers
- Shopzilla is part of the Connexity network
- Affiliate Window
- AdRoll
- Google AdWords
- Google Analytics
- Commission Junction
- EBay
- Yahoo!
- Microsoft
- Marketing
- Development
- Maintenance
- Customer support
- Networking
- Partnerships
- IT Operations
- Traffic acquisition
- Business Intelligence
- Data Analytics
- Product Catalog
- Merchants
- Shoppers
- Traffic
- Brand
- Expertise
- Software
- Hardware
- Employees
- Awards and Accolades
- Shopzilla, Inc. operates a portfolio of shopping web sites and business services for online retailers
- Shopzilla also operates the BizRate consumer feedback network that collects millions of consumer reviews of stores and products each year
- Shopzilla also operates the Beso shopping search engine and price comparison service that allows shoppers to search for and compare the latest fashions for women and men
- To create a comprehensive and focused experience for users to find the best products at the best prices from the best retailers
- To provide a powerful and cost-effective marketing channel for retailers of all sizes
- To provide the most efficient and effective shopping search experience on the Web
- To provide a comprehensive set of commerce solutions to the world's leading retailers
- It is focused on providing a great experience to users and merchants alike
- Online Shopping
- Product and Vendor Reviews
- Consumer Reviews
- Online shopping experience
- Consumer Feedback
- Social shopping
- Deals
- Advertisers
- Merchants
- Shoppers
- Websites
- Online advertising
- Banners
- APIs
- Network of publishers
- Social media
- Blog
- News
- Press
- Contact email
- Phone
- Postal mail
- Fax
- Shopzilla also operates the Beso.com fashion shopping site and the TaDa.com daily deals site
- IT infrastructure
- Development
- Maintenance
- Marketing
- Employees
- Office
- Pay-per-click model (merchants pay only when a shopper clicks on the link to their web site from a listing on Shopzilla)
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Try it freeShopzilla’s Revenue Model
Shopzilla makes money by combining different business models. Below, you will find the list of the different monetization strategies identified for this company:
- Advertising
- Online marketplace
- eCommerce
- Customer data
- Digital
- Cross-selling
- Market research
- Customer relationship
- Customer loyalty
- Dynamic pricing
Shopzilla’s Case Study
Shopzilla's CASE STUDY
The modern marketplace thrives on immediate access to information and simplified shopping experiences. Among the pioneers of this new eCommerce landscape stands Shopzilla, a company whose mission to enhance and streamline consumer shopping has profoundly influenced how we purchase goods online. Today, we delve into how Shopzilla emerged as a leading comparison-shopping service and explore the intricate business strategies that underscore its success.
Company Overview
Founded in 1996, Shopzilla, Inc, headquartered in Los Angeles, California, has evolved into a significant force in the consumer services sector. The company’s core mission—to enable shoppers to quickly and easily find, compare, and buy anything, sold by anyone, anywhere—resonates throughout its entire operation. Leveraging a highly robust search engine algorithm, Shopzilla sifts through millions of products from thousands of retailers, ensuring that consumers receive the best product at the optimal price point.
As an integral player in both North American and European markets, Shopzilla’s proficiency spans across diverse product categories. From electronics to fashion, and household goods to sports equipment, the platform offers comprehensive reviews, price comparisons, and other buyer-centric information—ameliorating the consumer’s journey from discovery to purchase (MSNBC, 2023).
Business Model
The fundamental bedrock of Shopzilla’s business model is its performance-based marketing strategy. Acting as a bridge between retailers and consumers, Shopzilla offers retailers a platform to showcase their products while furnishing consumers with an intuitive interface to compare and purchase items. Retailers compensate Shopzilla on a cost-per-click (CPC) basis, a model that enables the company to generate revenue each time a shopper engages with a retailer’s listing.
What truly sets Shopzilla apart is its proprietary search technology, allowing the platform to adeptly match products to relevant consumer searches. Through targeted advertising services and customer insights, Shopzilla further empowers retailers by facilitating precise market targeting activities. This combination of advanced algorithms and revenue through a CPC model is a significant differentiator that fuels Shopzilla’s dominance in the sector (Harvard Business Review, 2022).
Revenue Model
Shopzilla's revenue model pivots around the cost-per-click (CPC) mechanism. Retailers enter a competitive bidding system for keywords relevant to their products, aiming to secure higher placements in Shopzilla’s search results. This dynamic pricing model not only enhances visibility for premium bidders but also creates a steady revenue generation stream for Shopzilla.
In addition to the CPC model, Shopzilla offers targeted advertising services. Retailers can opt for premium placements within the platform and choose ad displays for specific demographics, ensuring a more strategic reach. This diversification in revenue streams further solidifies Shopzilla's position as a crucial intermediary between retailers and consumers (Shopzilla, 2023).
The Unique Edge
The uniqueness of Shopzilla can be distilled into several cardinal elements. Firstly, their sophisticated search engine algorithm delivers unmatched accuracy in matching consumer searches with the most relevant product listings. This precision increases consumer satisfaction and convenience—key drivers of Shopzilla’s sustained success.
Additionally, their comprehensive suite of marketing services transcends traditional advertising. By offering targeted insights and the ability to capitalize on consumer behavior data, Shopzilla empowers retailers with tools to enhance their marketing efficacy.
Moreover, Shopzilla's footprint isn't limited to just comparison shopping. The platform's expanded network includes the BizRate consumer feedback network and Beso fashion shopping sites. BizRate aggregates millions of consumer reviews annually, providing invaluable data for both consumers and retailers, while Beso capitalizes on the ever-growing fashion market (Statista, 2023b).
Customer-Centric Approach
At the core of Shopzilla’s value proposition lies its unwavering focus on delivering a highly efficient shopping experience for users. This commitment translates into a user-friendly platform, detailed product information, competitive pricing, and reliable reviews. Shopzilla’s dedication to excellence not only addresses functional consumer needs—like saving time and reducing effort—but also taps into emotional and social aspects by fostering a sense of affiliation and simplifying the shopping process (KPMG, 2021).
For retailers, Shopzilla provides a cost-effective marketing channel that levels the playing field between small businesses and retail giants. By investing in a CPC model, even niche retailers can achieve optimum visibility, driving traffic and potential conversions—democratizing the eCommerce space to a remarkable extent.
Business Patterns and Key Activities
Shopzilla's operational blueprint epitomizes several business patterns, including dynamic pricing, customer data utilization, cross-selling, and a robust online marketplace model.
With partnerships extending to giants like Google AdWords, Facebook, and Microsoft, Shopzilla’s network ensures an extensive outreach. Key activities span marketing initiatives, IT operations, and data analytics—all central to maintaining their competitive edge.
Their resources include an intricate product catalog, a loyal base of shoppers, and invaluable traffic data, bolstered by a seasoned team and cutting-edge software and hardware.
Conclusion
In tracing the trajectory of Shopzilla, it’s evident that the company’s integration of advanced technology, strategic partnerships, and customer-centric practices has been pivotal. By continually innovating within the dynamic landscape of online retail, Shopzilla remains an icon of efficient and effective eCommerce solutions.
As we look ahead, Shopzilla's model continues to illuminate how strategic business practices and technology can converge to create unrivaled shopping experiences—one click at a time.
References:
- Harvard Business Review, 2022. - Shopzilla, 2023. - MSNBC, 2023. - Statista, 2023b. - KPMG, 2021.
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