price comparison websites are hurting small businesses

Blending Into The Crowd: The Problem With Price Comparison Sites

Gee Ranasinha Advertising, Communications, Marketing, Technology, Website

“CHEAPEST FLIGHTS!”

“THE LOWEST HOTEL ROOM RATES!”

“WE COMPARE PRICES, SO YOU DON’T HAVE TO.”

Price comparison websites are all the rage at the moment. From airline flights, to car insurance, to getting the best on your savings, there’s sure to be a website that aggregates the prices of various products and services to allowing you to compare them.

Rather than manually searching, entering details, and writing down the answer we can simply go to a single website that does all the heavy lifting for us.

As consumers, we love price comparators. No-one wants to pay more than they need to for the same product or service, right?

But is it a fair comparison?

Blending Into The Crowd Is the Opposite Of What You Want

The problem with price comparison websites is that they reduce your business value offering to a commodity.

Perhaps you offer exceptional customer service, no-quibble warranty, or 20 years experience. If people are deciding whether to buy from you based on nothing else but price, all that business differentiation you’ve been building for the last few years gets ceremoniously flushed down the toilet.

You’re being judged by the price of your widget – and nothing else.

A quick question for you: think about the last time you bought something on Amazon. Do you know the name of the actual company, behind the scenes, who sold and shipped the doohickie to your door? Of course you don’t. As far as Amazon is concerned, the cheapest supplier gets the sale.

But that’s not the fault of Amazon. That’s on us.

“Price” Isn’t The Same As “Value”

A few years ago I decided that KEXINO would no longer participate in any form of agency pitches, tenders, RFPs, or the like.

How come? Because tenders and RFPs are designed to reduce supplier proposals to a commodity. They seek to trivialize business value differentiation.

If you’re buying a commodity product – washers, screws, cardboard boxes – then reducing the buying decision to a flat-out price battle might be the right decision. However if the buying decision involves subjective criteria (as it does when selecting a creative supplier such as a marketing agency) then going with the “best price” is a surefire path to disaster.

That’s why I don’t waste time on tenders. If a prospective client can’t deduce the value we can bring to their project based upon our marketing and pre-sales process, then we’re clearly not very good at our job. After all, price isn’t the same as value.

If we haven’t been able to successfully communicate to the potential customer why we believe we’re different, we haven’t done a good job with our own marketing. In which case, they shouldn’t be hiring us in the first place.

If You Can’t Stand Out, You’re A Commodity

Comparing your product purely on price and features ignores all the value differentiation that you’re trying to get across. Your marketing, positioning, branding and uniqueness is stripped away. Which is exactly the reason price comparison websites exist.

Comparison websites aim to anonymize you and your business, while you’re doing everything you can possibly do to stand out.

About the Author
Avatar for Gee Ranasinha

Gee Ranasinha

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After founding a successful media production firm, Gee became worldwide director of marketing for a European software company. As well as CEO of KEXINO he's an author, lecturer, husband, and father; and one hell of a nice bloke. He lives in a world of his own in Strasbourg, France, tolerated by his wife and young son. Find out more about Gee at https://kexino.com/gee-ranasinha/

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