DIGITAL DOUG: Online Investing
Monday, July 23, 2001
Gómez Closes the Door on Its Savings Center
As an analyst at Forrester Research in the 1990s, Julio Gómez covered money and technology, and his insights into the online brokerage industry were insightful and prescient. In 1997, he left Forrester and started his own company, Gómez Advisors, and quickly published his first Internet Broker Scorecard, ranking the best online brokerage firms using rigorous and consistent criteria. Gómez.com became the leading arbiter of who is best in the online brokerage industry, both for customers and for the brokerages themselves.
Since then, Gómez has grown to provide Scorecard rankings and merchant certification of more than 6,000 firms in over 75 industries, everything from Internet Footwear to Internet Cruise Sites. Visitors to the Gómez site could learn at a glance which sites rate best. Along the way, Gómez also developed a consultancy business to help ecommerce companies tune their Internet strategies. These partnerships, all with companies that Gómez rated for consumers, generated plenty of revenue for Gómez, but they also raised questions of fairness and impartiality. Could Gómez fairly rate a company that had paid it tens of thousands of dollars?
These partnerships also included a component for consumers on the Gómez.com web site, their Savings Center. Here, visitors could sign up for special offers and cash rebates in return for opening an account with a highlighted partner. The deals were a great deal for consumers -- for instance, you could get $50 to $100 in cash just for opening an account at an online bank. For those who might have been hesitant to initiate a relationship with an e-finance firm, this was a powerful incentive to take action.
On July 18, Gómez quietly closed the doors on this controversial area of their site. After three years, Gómez shut down the Savings Center, along with its related affiliate program for webmasters. There is no announcement of the closing on the Gómez web site, and visiting the Savings Center via its old url only turns up a terse message that "Gómez.com no longer offers Savings Center deals." The Internet Scorecards are unchanged, and the company continues to expand its industry rosters.
While the Savings Center may have disappeared, Gómez is still running strong with its professional services business (at GómezPro.com), leaving the same old questions about editorial integrity. In the end, Gómez's business is built on being an impartial observer of the industries it covers, so it's in their best interest to maintain a Chinese Wall between its two businesses, its services for industry professionals and its Web site and ratings for consumers. They'll likely never be able to quash questions about their commercial relationships with the companies they review. For now, consumers may be the big losers with the closing of the Savings Center.
by Douglas Gerlach
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