Big-box retail stores and grocery stores are silent battlegrounds, where product manufacturers bid against each other for coveted positioning in the most visible locations, such as the “end caps” of each aisle, or at customers’ eye level on store shelves. On the Web, the closest analog to a store aisle is a search result page—and the key to the fortunes being raked in by Google is the online bidding system that lets advertisers decide how much they’re willing to pay to have their ads positioned higher on those pages.
But there are critical corners of the Web where, for unknown reasons, Google hasn’t yet applied its system, called AdWords. These are search pages within the sites of online retailers like Buy.com or CircuitCity.com. Just as in stores, a product’s placement in e-tail search results can greatly affect its sales. So it’s no surprise that at least one company, New York-based Guidester, has stepped in to play the AdWords role in the world of e-tail search.
Guidester’s somewhat grating neologism for the practice is “searchandising” (search + merchandising). And now the sultan of searchandising is coming to Boston. The 20-employee company, launched in 2000 by Manhattan entrepreneurs Joe Chin and Art Abeleda, announced today that it has hired a new chief executive, John Federman, and that it will relocate its headquarters to a location in greater Beantown yet to be determined. “I’m a Boston guy, so our operations, finance, and marketing will all be Boston based, though we will also maintain our New York offices,” says Federman, who until December was CEO of eStara, a Reston, VA, provider of click-to-call and click-to-chat software for e-tailers that was purchased by Cambridge, MA’s Art Technology Group (ATG) in 2006.
Consumers who are aware of Guidester probably know it through the customized “Guidesters” on e-tail sites like RitzCamera.com. That site’s “Compact Camera Guidester,” for example, helps surfers narrow down the store’s hundreds of digital camera options by specifying how many megapixels they’re looking for and whether they want features like image stabilization. Indeed, until recently the company has presented itself primarily as a provider of tools that make online shopping easier; there’s been little mention in the publicity around Guidester that those tools favor product makers who pay for the privilege of higher search placement. As MSNBC.com put it an article last year, Guidester “helps customers narrow their product choices and quickly find exactly what they need.”
But calling Guidester a maker of online shopping tools is like calling Google a search engine. It’s true, to an extent—but the consumer-facing tool is merely the bait, and what Guidester really sells is a bidding and placement engine, called AdMatch, that encompasses scores of online retailers and thousands of products. E-tailers love the system because
