Internet Bargains May Be More a Matter of Method Than Price

I like getting a good deal as much as the next guy, depending on who the next guy is, but shopping for the best price online is getting tough.

In the early days, sometime last year, it was simple. Plug the title of a book, brand of cigar or name of a musician into an online software agent, called a shopping bot, and back would come a list of online retailers who sold the product and their corresponding prices.

But the marketing folks have stepped in, and now we look back upon those quaint days of simplicity with much fondness. Unlike the real world, the diversity in shopping on the Internet lies not in the difference in selection but in the multiplicity of methods of purchasing.

It’s not a matter of what you want to buy, but how you want to buy it.

Take, for example, aggregation, the clumsily named business model offered by Accompany Inc. (https: //www.accompany.com) and Mercata Inc. (https://www.mercata.com). It’s based on the idea that a group of people each buying the same item can get a lower price than an individual because they are buying in larger volume.

Although the concept is simple, the execution can get a bit tricky, as indicated by the detailed instructions found on both of their sites, including a six-page tour on the Mercata site. When an individual decides to buy an item, they don’t know the price they’ll be paying. They do know, however, that the more people who sign up, the lower the price will go, as opposed to an auction where the price generally goes up as more buyers get involved.

The key for this model is getting traffic to the store so that there are enough buyers to drive prices down and to get merchants to cooperate.

Accompany hopes to act as the under-the-hood aggregating service for portal Web sites such as Yahoo and Excite, who would have branded “aggregated buying” sites, much as they already have branded auction areas. They would all drive people to the Accompany market, but it would appear as if they’ve never left the portal.

Mercata’s business model calls for the company to go it alone, much as EBay (https://www.ebay.com) stands alone as an auction site. The Bellevue, Wash., company has funding from Vulcan Ventures, the venture capital arm of Microsoft co-founder Paul Allen.

Getting merchants to cooperate can be more difficult. Merchants who want to find online customers may be willing to go with the program for a while, but others, such as Amazon (https://www.amazon.com), have cheaper ways of acquiring patrons.

“They would be paying to acquire one big block of customers at a very, very low cost. Once they have that customer, it’s their responsibility at that point to retain them,” said Accompany Chief Executive Jim Rose, who conceded that signing on merchants will be more difficult than signing portals to get traffic.

The aggregated buying model combines the same two ingredients that make EBay and online auctions so alluring: community and commerce. (Does anyone remember when content was king and not just “that other ‘C’ ”?)

The experience of a friend of mine recently reminded me that auctions are not necessarily about getting the best price, particularly at places where there are many buyers. He purchased a DVD player at the relatively obscure Cameraworld.com auction for $260 and turned around and sold it on the immensely popular EBay for $395. The retail price was $400.

Loyalty programs such as Netcentives Inc.’s ClickRewards (https://www.clickrewards.com) and MyPoints.com Inc. (https://www.mypoints.com) are feeding our addiction to frequent-flier miles. Customers who shop at stores that are part of those networks receive miles, and because the value of those miles are so intangible, it’s difficult to compare that to, say, buying the same product for a dollar less.

E-Centives Inc. (https://www.ecentives.com) and CoolSavings.com Inc. (https://www.coolsavings.com) have brought old-fashioned coupons to the Internet, although the two are wrangling in the courts over who has the patent to do it.

E-Bates.com Inc. (https://www .ebates.com) takes the same model as the Discover credit card: cash back as you shop. Many online merchants have adopted a strategy called affiliate programs, pioneered by Amazon.com, where retailers pay bounties of up to 25% of the sale to Web sites that refer users to the store. Most Web sites pocket that bounty, but E-Bates will kick back the entire fee to the customer, making money instead on advertising on the site.

The Haggle Zone (https://www.hagglezone.com), a service run by NetMarket, a subsidiary of Cendant Corp., boasts on its site that “everything is negotiable.” They don’t mention that you’ll be negotiating with a computer program, which has been instructed to sell its items at a set average price. As a result, some customers may bargain for better deals than others, but in the end the average price will be what the vendors have stipulated.

The Priceline.com (https://www.priceline.com) model, while appealing because of its simple “name your price” slogan, is limiting. I would pay more for a nonstop flight, but they don’t allow customers to specify that. I want to be able to name my time as well as my price. I want an aisle seat and not be stuck in the middle of the back row.

I want, I want, I want. To paraphrase Marshall Industries’ Chief Executive Robert Rodin, I want it perfect, free and now.

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Times staff writer Jonathan Gaw can be reached at jonathan.gaw@latimes.com.