Hey Bing, Here’s Another Decision Engine You Can Buy!
Ever wonder if you should buy a new digital camera or wait for a better one just around the corner?
Even worse, did you buy the brand-new HDTV right before 3-D came out?
The Seattle-based Decide.com is the brainchild of the folks behind Farecast.com, which helped predict whether it was the right time to buy an airline ticket or if a price drop was coming.
Farecast, which was purchased by Microsoft three years ago for $115 million, is now Bing Travel.
Similarly, Decide.com is trying to provide the same information for the consumer electronics industry, which often moves too fast for the average person to keep up.
The concept plays off the same fears that Best Buy’s new Buy Back promotion is addressing. The promotion, which allows you to return products for the latest model for a fee, is the subject of a hysterical TV commercial.
In one scene, a man is happily receiving his new 3-D TV, only to find out that 4-D is coming soon — no glasses needed! The man slaps himself, while his daughter runs around the yard, teasing: “You got the wrong TV, sillyhead!”
Decide’s CEO Mike Fridgen said on average six new laptops and one new TV come out every day, and a camera comes out every other day. “We are the only site that says ‘wait,’ there’s a newer model available at a cheaper price.”
The site is designed to help with deciphering product cycles and pricing trends.
Decide’s VP of Product and Market Michael Paulson said 20 percent of prices fluctuate daily, and it’s just as likely for prices to go up as down because of dynamic pricing models.
By keeping track of this information for the past two years, Decide has gathered 60 terabytes of data to be able to predict with some accuracy when a new model is coming out or when the price might change.
For example, on Amazon the Canon PowerShot G11 gets nearly five stars and costs $650. Fridgen says there’s no obvious reason not to buy it. But if you check Decide.com, you’ll find out that it’s already been on the market for 19 months and that a newer model is available now for only $450. With 78 percent confidence, it believes the price will hold steady.
Decide.com also aggregates information from news and rumor sites, which provide information on when products are coming.
The company anticipates making money through referral fees to e-commerce sites, where people will make purchases.
Right now, Fridgen says retailers are a little scared of the idea because it may suggest that a consumer should wait; however, he believes that it will ultimately benefit retailers because customers will be happier with their purchases and be less likely to make returns.
The company was co-founded by Oren Etzioni, who is also a computer science professor at the University of Washington. It has raised $8.5 million from Maveron, which was started by Starbucks’ Howard Schultz, and Madrona Venture Group, which was founded by one of the original investors in Amazon.