Shopzilla is sold for $525 million

[Shak]

LOS ANGELES (Reuters) - The E. W. Scripps Co. (SSP.N: Quote, Profile, Research) said on Monday it planned to buy Shopzilla to capitalize on the growing specialized Internet search business.
Scripps said it would pay $525 million in cash for 100 percent of Shopzilla, a comparison shopping search engine.

Shopzilla shareholders would also get Shopzilla's net working capital at the time of closing, estimated at about $35 million.

[reuters.com...]

1st eBay buying Shopping.com and now this, who be next?

Shak

[RailMan]

ok, i'm off to build a shopping search engine network
i'll be back next month .........

[christopher w]

who be next?

pricegrabber seems the most likely IMO

[Namaste]

retail is hottttttttttttt

[Shak]

who's left:

pricegrabber
nextag

who's been sold:

kelkoo = yahoo
pricerunner = valueclick
shopping.com = eBay
shopzilla = scripps

who may be looking to buy:

IAC (Diller and Co)
MSN
Amazon

[christopher w]

IAC (Diller and Co)

BINGO

[iblaine]

If after the dot com crash someone told me a site called ShopZilla would be sold for half a billion dollars I wouldn't believe them. Yet here we are in a time warp of sorts.

[lorenzinho2]

< Yet here we are in a time warp of sorts

It does feel like a time warp, especially in looking at the multiples involved. That being said, Shopzilla has been around for a long time... they were formerly Bizrate if my memory serves me correctly.

[martinibuster]

I have to go back to my nap.

[edited by: martinibuster at 10:32 pm (utc) on June 6, 2005]

[Chico_Loco]

These prices seem crazy high - somebody hear a bubble popping?

[Sanenet]

organizing more than 25 million products from more than 45,000 stores.The corporate re-branding was done to better position itself as a broad-based shopping site.

U.S. consumer retail spending is greater than a trillion dollar annual business, and Forrester Research estimates that $79 billion of that spending occurs online today. That figure is expected to double over the next six years as more consumers get comfortable using the Internet to shop. With 13.2 million unique visitors per month, Shopzilla, Inc. had already begun to tap the vast potential of the emerging ecommerce market.

Quoted sections are from Shopzilla

So, we have traffic. 13.2M visitors, say 1 in 100 spends an average of 100$, thats 13.2M$ cashflow, lets assume 10% profit - 1.23M a year cash generation.

Over 2,400 stores are participating in BizRate’s program

So, 2.400 stores (less than 10%) have been conned into your "BizRate" customer rating service.

Founded in 1996, the Los Angeles-based company is profitable and privately held.

Well, woop de doo. How much do 2 programmers and a chick to make the coffee cost?

Either something we don't know about is going on (ie a revenue stream that isn't prominent on there website) or we're looking at money laundering via the Ukranian mafia (can we say that here? Or, will we be kicked off for suggesting this?) has hired a techie accountant.

1.23M$ (assumption) a year cashflow in no way adds up to half a billion dollars. Mad. Just... mad. No wonder B. Geldorf is foaming at the mouth.

[edited by: lorax at 2:33 pm (utc) on June 7, 2005]
[edit reason] removed URLs [/edit]

[Sanenet]

Whoops... just saw

Founded in 1996, Shopzilla is a privately-held company that is expected to generate $30 million to $33 million in earnings before interest, taxes, depreciation and amortization on revenue of $130 million to $140 million for the full year 2005.

Somebody got a zero confused when working out profitablity!

[sdani]

I have a niche price comparison engine, and based on MetricsMarket's traffic reports (i know they are not accurate, but..) ShopZilla's traffic is just 81 times mine.

If I enchmark it based on my stats, the half billion price tag seems to be a bublle made up of few more bubbles.

Except top 2-3 merchants at CJ, the best affiliate EPC is about 200$. They got 2400000 visitors in a month, which probably means 480,000 a month and you have you deduct the expenses.

Am I missing something here?

sdani.

EDIT - OK.. I MISSED THEIR BIZRATE SITE.

[limitup]

I don't use "shopping comparision engines" and know nothing about them. So is every link off their site basically just an affiliate link that they get a commission on?

[sdani]

limitup, most of the small niche comparison engines get affiliate commission. The big ones like shopping.com / and probably shopzilla charge per click.
They don't keep inventory, so it is hard to expect more than 10% revenue per sale if you don't keep the inventory and supply chain (so, I guess per click / affiliate model .. all should fall between 5-10% per sale.).

But I am just making some assumptions about someone else's business based on my understanding of it.

sdani

[ahmedtheking]

Pretty much! And, because they know people are going to be using them, they push other ads like PPC. The main thing is that if people go to these and get a good deal from them, they'll come back again!

I use these compare sites because it's just so much easier than trawling through half the crap on search engines! And they do wot they say on the tin!

[The_Founder]

What is this 1999? HAHAHAHA

They will NEVER get 525 million back from a site like shopzilla... E. W. Scripps got ripped off in a big way... to the tune of 1/2 a billion for a freaking script... LOL! excuse the pun :)

[BonniesGang]

I don't mind paying for advertising, but in my field (health and beauty) potential customers come at 50 cents a click.

Anyone have any success at those prices?

[edited by: lorax at 2:34 pm (utc) on June 7, 2005]
[edit reason] removed URL [/edit]

[ggrot]

I suspect more than 1 in 100 buy something. This is true for content sites or what not, but what percentage of the people who walk into Wal-mart buy something? 99%? Its targetted traffic. I wouldn't be surprised if as high as 1 in 4 of those uniques bought *something*. Multiply your numbers by 25 and it starts to be a bit more believable.

[Dpeper]

Did this deal include bizrate?

Donny

[sem4u]

Wow! Another one sold!

I expect IAC and Amazon to buy one each next.

[brakkar]

I'm interested in creating a pay per click shopping directory. Does anyone know a good script to handle it?

Brakkar

[haggul]

Shopzilla is definately a PPC setup - although they do also take affiliate scheme product feeds as well to fill in the gaps where they can't find anyone mug enough to swallow the PPC model.. So they really don't care if punters spend any money at the merchant sites (other than I guees the merchant might drop the programme if it's not profitable).

The real trick with being able to work that way versus a purely commission on sales model is to carry enough clout to be able to persuade advertisers to take the gamble - something only a handful can achieve.

[RailMan]

>>I'm interested in creating a pay per click shopping
>>directory.

you're not the only one ..........

>>Does anyone know a good script to handle it?

i'll sell you my code for $100 million. bargain.

[awall19]

>Did this deal include bizrate?

Shopzilla = new name for BizRate. and a bad name at that, really.

[ahmedtheking]

Hmmm, what will be the next hit? Maybe an eBay/Shopzilla network?

[fr_cnx]

message to Bill, i am selling you can call me!

[limitup]

Where do they get 13.2 million visitors per month? I've never seen a single ad for shopzilla?

[sem4u]

It used to be BizRate. I don't know why they changed the name.

[The_Founder]

Guys... I am positive they are now suffering from Buyers guilt..

If you had over 1/2 Billion dollars... is 'shopzilla' where you would spend it?