8 October 2012
Huge growth potential for price comparison websites in Asia
The pervasiveness of e-commerce has led to the rise of price comparison websites in Asia. However, the road ahead for first-movers is challenging. In an article published on ZDNet, Spire Research and Consulting weighed in.
After gaining popularity in Western markets such as the United States and Europe, price comparison websites are starting to mushroom in Asian markets. Price comparison services essentially allow consumers to compare product pricing and reviews with ease.
While the players entering this market in Asia would enjoy first-mover advantage, they will also pave the way for competitors. The path forward also poses several challenges; including educating retailers on the business benefits, as well as educating consumers on the usage of such sites. This may eventually alter consumer behavior, as consumers will check prices online before making any purchases.
Leon Perera, Chief Executive Officer of Spire Research and Consulting, commented that the slow adoption rate in Asia may be due to the existing retail structure; as there is more unorganized retail in Asia, especially in the three big emerging economies – China, India and Indonesia. Moreover, unorganized retailers may be less willing to pay to be listed and may also offer negotiated rather than fixed prices.
The situation is made more complex with the penetration of parallel imports and counterfeits, which are more common among smaller and less organized retailers. These products could lead to low listed prices which the larger retailers and vendors may then object to.
Moving forward, Perera highlighted that it is crucial for such price comparison websites to create awareness in specific product categories, but that is merely the first step. He explained that more product categories should be included to gain economies of scale, as the industry “was far from mature”.
Spire Research and Consulting is the leading research consultancy in global emerging markets. Spire's competitive advantage lies in its ability to deliver actionable intelligence on the external business environment in support of its clients’ strategic decision-making in marketing and business development. Spire's clients include 50 Global Fortune 1000 companies and government agencies in 15 countries. For more information, please visit www.spireresearch.com.