The Demise of Yahoo Shopping

Yahoo continues to be gutted and reorganized, creating the latest casualty, Yahoo Shopping.

As reported by many today, Yahoo Shopping is not technically disappearing, but changing completely. PriceGrabber product listings will instead populate Yahoo Shopping listings beginning in March, so consumers will continue to see product results. However, make no mistake, this will make Yahoo essentially a glorified affiliate for PriceGrabber and will be the end of Yahoo Shopping as it has been.

The makeover at Yahoo has been nothing short of dramatic. As written about here at ChannelDollars back in July of 2008, the Yahoo and Microsoft wedding was bound to occur. The eventual transfer of Yahoo search results to Bing created listings certainly spelled the end of Yahoo Search Submit Pro (YSSP). Since Yahoo was no longer creating the actual search results they would display, YSSP was a de facto victim of the merger along with Jerry Yang. (By the way, YSSP was supposed to end on 12/31/09, but traffic actually continued until 1/5/10. For merchants still on the platform, congrats, you received 5 days of free traffic.)

The interesting part is that Yahoo Shopping has now been targeted in a bigger reorganization effort, and this should be a bellweather to those following the industry. For one, it is indeed a victory for PriceGrabber, as reported by some other blogs and ecommerce sites. The PriceGrabber network has managed to envelope CNet, AOL Shopping (again), and now Yahoo Shopping.

Can anyone say consolidation?

Does this also indicate just how hard it is to make a comparison engine work in the first place?

Primarily though, it signals continued change in the industry. Yahoo has made vocal their desire to focus on content, but this is also a passing of the torch, because Yahoo Shopping had been one of the original giants in the comparison engine industry. Before Shopzilla and Bizrate came together, and before Froogle decided to start changing names, Yahoo was a monster. Yahoo Shopping still generates huge amounts of traffic according to companies like Hitwise, however anyone using Yahoo Shopping over the past several years can testify that traffic and subsequent sales became proportionately smaller compared to other leading comparison engines like NexTag, Shopping, and the aforementioned Shopzilla. Yahoo was late to the game in adding bidding technology, and continued to fall behind in aggressively focusing traffic into finely tuned search results. Instead, I think it’s safe to surmize that the Shopping aspect of Yahoo was of little focus internally, and essentially left to run.

This leads us to the result in today’s news. Yahoo decided that they could make more money displaying PriceGrabber listings than Yahoo’s own listings. Not terribly surprising, considering they have also abandoned being a search company.  The real question is, are there larger lessons here? Will this be the time that comparison engines consolidate to a handful of large players, and numerous specialized sites?

Regardless of the answers, it’s worth taking a step back and recognize the passing of one of the originals, and the continued transformation of what was once an internet worldbeater, in Yahoo.

January 11th, 2010