Consumers Use Comparison Sites to Save Money – Enterprises Use Comparison Sites Actively to Compete

• Consumers can save money by using comparison sites – approx. 10 per cent on computers, electronics and photo equipment and approx. 30 per cent on video games and films.
• Many consumers use comparison sites: The three most frequently visited Danish price portals have a total of approx. 3.2 million visits every month. Thirty per cent of consumers have not used a comparison site in the past year.
• Comparison sites reduce consumers’ search costs: Sixty-five per cent of consumers use comparison sites for gathering price information, and 50 per cent to ensure that they will buy at the lowest price.
• Enterprises use comparison sites actively to compete, particularly in simple goods markets: Ninety per cent of dealers in the TV market find that comparison sites contribute to increasing the competitive pressure on the market. Ninety-three per cent assess that the sites contribute to lower prices. Approx. 73 per cent of enterprises also find that comparison sites increase the competitive pressure from new competitors. Ninety per cent of TV dealers use comparison sites to check the prices of their closest competitors.
• Four barriers may prevent comparison sites in complex markets: Lack of data that are publicly available, non-comparability of products/services, inactive consumers and lack of incentives for enterprises to contribute to the comparison sites.
• Commercial operation of comparison sites is most expedient. However, in certain cases it may be an advantage for public authorities, consumer organisations and industrial associations to support the development of comparison sites if various barriers have prevented commercial operators from developing such sites.

Based on the analysis, proposed recommendations for the good comparison site are that:

• The comparison sites make vital information available to the consumers in a clear and easily understandable manner.
• The comparison sites aim for the greatest possible transparency in their comparison of the products.

Download the analysis Price comparisons on the internet (chapter one, pdf)