How Do Price Comparison Websites Work?

Price comparison websites are the best friend of thrifty customers, allowing them to compare the price of the same product sold by different sellers, which makes it easier to find good deals. They are a great tool that make online shopping a breeze, but have you ever wondered how they actually work? Let’s find out the logic behind price comparison websites!

What is a Price Comparison Website?

Price comparison has become a built-in function in most used search engines, but there are still a host of websites providing this service. Allowing customers to list the same product sold by different sellers, price comparison websites are a great tool for finding the most affordable offer. 

Offering a similar function, product comparison sites compare 2 or 3 different products, which allows the customer to see the differences in features, quality, and performance. Some of these product comparison sites also offer a price comparison functionality, which allows the customer to compare the cost of each product in addition to their features and performance.

It is obvious that price comparison sites increase the competition between various online shopping platforms and marketplaces. Some online shopping platforms, for instance, team up with price comparison sites to improve their competitive edge in the e-commerce ecosystem. It is also common practice that some of these price comparison websites offer exclusive coupons and discounts to customers who buy the product using their affiliate links.

How Price Comparison Websites Work

Now that we know what price comparison sites are, let’s have a close look at how they work. In fact, the end service offered by these platforms are more or less the same. However, the methods of data collection and data processing they use to provide this service may vary. Some price comparison websites collect their data directly from sellers whereas some choose to use third party data feeds for data collection. Other price comparison websites use data scraping to collect data from the internet. Let’s examine these methods in detail.

Data Collection Directly from the Seller

This is a method often used by larger-scale price comparison websites. Collecting data directly from the seller means that there is little room for error, which in return increases the reliability of the price comparison tool offerd.

But why and how do the sellers and online shopping platforms actually share their data with price comparison websites? By allowing price comparison websites direct access to their own Application Programming Interface (API), online shopping platforms remove any need for third parties. And, this method is beneficial not only for the price comparison websites but also for the online shopping platforms as it enables potential partnerships, which in return may boost sales.

Data Scraping

A popular method for small-scale and low-budget price comparison sites, data scraping means scraping the data of online shopping platforms already circulating on the internet. Scraping bots used for data scraping collect data that is already circulating on the internet and pass them on to servers so that they can be processed and used on price comparison websites. Although data scraping is a cost-efficient method, it provides limited access to data since most online shopping platforms take precautions to prevent their data from being used in such a manner. These precautions also increase the likelihood of error.

Third Party Data Providers

Some price comparison websites prefer using third-party providers for data collection. This method is not as cost-efficient as data scraping, but it is more reliable and leave little room for error for all parties involved. Third-party providers scan online shopping platforms on a constant basis and allow price comparison websites to access to their own databases so that they can extract data and use it on the price comparison website. So, this method allows a price comparison website that benefits from an API data feed service to access up-to-date data at all times.

Regardless of the method they use to collect and process data, price comparison websites offer a variety of advantages to customers and online shopping platforms alike. So, there is no doubt that we will see these types of services and tools used more frequently in the future.


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