February 21, 2002 3:30 PM PST
Some Yahoo sellers splitting personalities
Instead of opening one store in the company's shopping mall, they are opening multiple stores, all under different names, but offering mostly the same inventory at almost the same prices. The result is that a customer who searches for a product on Yahoo Shopping may find that they get multiple results from the same merchant without knowing it.
Placement in search results is important for a Web site or a Web store because only a minority of Web users tend to look at listings beyond the first page of results, said Danny Sullivan, an editor with SearchEngineWatch.com.
By "stuffing the listing" with products from their Web stores, Yahoo merchants with multiple stores are crowding out competitors, Sullivan said. And that's not good for consumers or other merchants, he said.
"This sounds like something that Yahoo needs to plug a hole in," Sullivan added.
The practice of setting up multiple storefronts with the same products does not violate the terms of service for Yahoo Shopping, said Stephanie Iwamasa, a company spokeswoman. Iwamasa did not know how many merchants have set up multiple storefronts but said the practice wasn't widespread.
"This is a technique by some merchants to market their products more effectively," Iwamasa said. She said the practice was neither deceptive nor unfair, adding, "I think that this would be categorized as a technique and a strategy, not as a negative practice."
The strategy is similar to those once used by Web site operators to boost their presence in search results on sites such as Yahoo and Excite.com. But Web site search engines have largely cut down on the practice by clustering results from similar sites.
Yahoo may be loath to stop the practice because it gets additional revenue for each storefront a merchant creates, Sullivan said. Merchants pay $49.95 per month to have Yahoo host their stores and 10 cents for each item they list within their storefronts. Merchants also pay transaction fees to Yahoo.
"You would hope that Yahoo would clamp down on the practice, but obviously they're making money on it, so perhaps they might not," Sullivan said.
But Yahoo's Iwamasa said the revenue gained from merchants with multiple storefronts is "negligible" and not a motivating factor.
"That's not a reason why we would not allow it," she said. "We can't dictate whether these are ethical or non-ethical marketing techniques."
One Yahoo merchant, who noticed several months ago that some of his competitors were listing multiple stores, said it is Yahoo's job to put a stop to the practice.
"Buyers are led to believe that they're buying in a marketplace with a lot of competitors, but in the end, they are looking at only one," said the merchant, who requested anonymity. "It defeats the purpose of going to a marketplace. Imagine going to a mall and every store would be the same company--how would you feel?"