Industry Eye: Case Study - ElectricShopping.com Boosts 
Conversions With Comparative Pricing

PROBLEM: ElectricShopping.com, a London-based online retailer of electronic appliances and accessories, wanted to increase the conversion rate on its website while reducing bounces.

SOLUTION: Implemented an onsite comparative pricing tool to prove to consumers that its prices were the lowest.

RESULTS: Sales increased in last year's fourth quarter after the tool's launch, with the website's conversion rate up 18.7 percent and bounce rate down 7.2 percent.

When it says its low prices can't be beat, ElectricShopping.com means it. In fact, the online electronics retailer proves it, taking the unconventional step of listing its competitors' prices — Amazon and eBay among them — alongside its price for the same product.

Frustrated by the amount of money it was costing just to bring consumers to its website, ElectricShopping.com knew it had to do everything it could to convert them once they were there. That's how the idea of comparative pricing took root. Working with WinBuyer, an onsite comparative pricing (OCP) solutions provider, 
ElectricShopping.com launched OCP on Oct. 7, 2009.

"We know that once we've gotten [consumers] on our site, if we can keep them there, they're more likely to check out," says Rob Levy, CEO of ElectricShopping.com. "An objective was to try and reduce our bounce rate — make sure that once customers come to our site, they know immediately that we're either the cheapest or one of the cheaper places to buy this product."

Trust Builder
By taking the counterintuitive step of placing links to its competitors on its product pages, ElectricShopping.com has gained consumers' trust and respect. Similar to retailers that include negative customer reviews on their sites — which ElectricShopping.com does also — the company realized it had to be honest with consumers at all times. That includes the rare occurrences when it's not offering the lowest price for a product.

But not all is lost when ElectricShopping.com is beaten on price. The retailer offers free shipping on all its products, so even if consumers click to competitors' sites for lower prices via the OCP tool, they may find ElectricShopping.com is still the cheaper option when shipping costs are factored in.

"Customers do sometimes come back to us in the end," notes Levy. "The fact that they've followed a link to a cheaper price on somebody else's site, but ended up shopping with us, that builds amazing brand loyalty."

In addition to recouping some seemingly lost sales due to its free shipping offer, ElectricShopping.com also earns a small referral fee from WinBuyer every time a consumer clicks a competitor's link on the OCP tool. It's not enough to make up for a lost sale, but something to ease the pain.

Conversions 
Increase
Launched in last year's fourth quarter, OCP has proven worth the investment. In an A/B test conducted over a month, consumers presented with product pages containing OCP converted at an 18.7 percent 
higher clip than those not shown OCP. That conversion rate led to better-than-expected sales 
in the quarter, and bounce rates decreased 7.2 percent as consumers didn't leave to find products at a cheaper price somewhere else.

Not right for all retailers, such as high-end brands that don't compete on price, OCP is an effective selling tool for ElectricShopping.com.

"We're cheaper on most of our items, so we saw that good increase in our conversion rate," says Levy. "This tool was implemented to make sure that the traffic that we're paying to come to our site was converting. And it has."