Price comparison websites: the paradox of the lowest price
Phillip Stewart
2

The report you are referencing is a pretty interesting, and the impact that PCW are having on the consumer marketplace is somewhat surprising given the nature/intent of PCWs; who would have thought that would be the case!

I don’t necessarily agree with the concept that government need to regulate PCW fees, as long as they conform within legal constraints required of them why should there be additional regulations. I see them operating no differently from any other professional service provided in the marketplace; real-estate for example, whether it is physical or online will result in additional costs to the consumer, or our local TradeMe auction service, the auction fees will no doubt have an impact on the way the seller cover costs through on-sell prices. I think no matter what advertising or enhancement service are provided, whether it is through ICT or not, will unavoidably place additional cost on the end consumer.

Although the report does indicate the adverse impact and implications on the consumer, I am always wary that statistical determinations can be misleading if assessed in isolation (not that I am questioning the validity of the report). An interesting report on PCW consumer research by Marzena Lipman highlights some interesting findings; as a result of PCW significant consumer time commitments are reduced, consumer satisfaction and convenience improves, company loyalty increases, and new firms are able to gain credibility in the competitive environment. I think like with many things, this is a service that offers a number of advantages both to the consumer and firm/company, and although it may have an impact on the marketplace, this is not unique or concerning.

I don’t think that PCW should be taken away from the private sector and centralised, nor could that even be a legal option? I do think that if the government were to do this, it would be opening up legal aspects that infringe on the trade and labour policy. However if they were to do so, they would surly not compete with the private sector, given innovation would be the primary driver for this. There would be a significant risk of public money being invested into something that is not necessarily a public service and of financial value?

Good post, and it opened my eyes up to some interesting aspects on a product that I have used for some time now.

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