AOL launches shopping service

MIAMI – America Online Inc. has launched an online shopping service called inStore that lets users search for products, compare prices and features and set up price-drop alerts.

InStore, which also features exclusive sales, has its own Web site at http://www.in-store.com and can also be found on several AOL online properties, such as the AOL.com portal, the CompuServe.com Web site and the subscriber-only AOL and CompuServe services. InStore has also been integrated into the AOL.com search engine and with AOL’s AIM instant messaging service, the company announced Monday.

InStore replaces Shop@AOL, a similar but more limited online shopping service that didn’t have its own Web site and didn’t have a comparison-shopping feature, said an AOL spokeswoman.

The inStore shopping function is called Pinpoint Shopping and it’s based on BizRate.com’s comparison shopping search platform, whose catalogue features about 24 million products from about 47,000 stores. Pinpoint also serves up BizRate.com’s user ratings of merchants. BizRate.com provides its platform to other sites, including AOL’s competitor in the portal space Lycos Inc.

InStore is also expected to include a feature called Remember It, which lets users save results from searches, in case they need to interrupt their shopping and come back to it later. Users can also have inStore alert them when a product’s price has fallen to a specific level. However, at press time, the Remember It feature hadn’t been activated and the alert feature couldn’t be found.

While AOL lagged portal competitors such as Microsoft Corp.’s MSN and Yahoo Inc. in this area, inStore puts AOL in the game, said Patti Freeman Evans, a Jupiter Research analyst. “It’s a very strong catch-up move for AOL. The company is offering a robust search shopping and comparison feature which puts them in line with not only the comparison-shopping sites out there but also with Yahoo and MSN,” she said.

AOL’s late start is also offset by the fact that about two-thirds of the approximately 23 million subscribers to AOL fee-based services are online shoppers, she said. “(InStore) is a very good thing for the customer base that’s already on AOL and wants to shop,” she said.

The launch of inStore is part of an overall trend for portals and other types of sites to offer a comparison-shopping service to their visitors, Freeman Evans said. “Consumers are going to be seeing comparison-shopping more and more frequently throughout their shopping experience,” she said.

Ultimately, for inStore to succeed, AOL will have to keep a close eye on how visitors behave on the site, so that it can make the adjustments, add the shopping features and strike the merchant partnerships that will keep those visitors coming back, Freeman Evans said. This active participation by AOL is particularly important, given that the underlying platform from BizRate.com is also used by other Web sites and thus offers no exclusive differentiation to AOL, she said.

“The key for AOL is to be continually testing the types of products its customers search on and click on … to see what its particular customer base is more responsive to and then react to that,” she said. “To present a better experience, AOL needs to understand what consumers want, and react to that with more services and more partnerships with retailers these consumers want to talk to.”