Now that they have firmly established themselves in the transactional business with Google Checkout, is it feasible to believe they may wish to get even closer to the customer. Should we begin to consider the what ifs and if so, when?

With Google Checkout turning out to be a relatively big success, even challenging the likes of PayPal, might they be turning their attention to controlling the ENTIRE online shopping experience on the Internet merchant side? This would be monumental and create an enormous shift in the way business is conducted. At the very least, there will be a significant adoption rate, resulting in lost business to value hosting providers everywhere. True to Google form, they could feasibly waive costs (for a period of time) to gain market share and change the economy hosting industry overnight.

Amazon just may have already done this with their Simple Storage Service. This is the model Google is using in the payments side of the business with Google Checkout, and online payment service providers have been forced to offer better services like fraud protection, loss prevention and PCI compliance just to stay competitive.

For instance, we at InternetMerchant.com focus on niche, servicing small-to-medium-sized etailers with a suite of products that are cutting edge, but eventually will be mainstream. All this will occur before the likes of PayPal, or Google could implement on a broad scale. Fact is, the big guys cannot be all things to all people, so they need to stay somewhat generic to reach the masses. Therein lies our opportunity to differentiate and beat them at their own game. While they can play in all markets, like hosting, we need to continue to find the vertical market products and services they simply cannot compete with.

It only takes a small, well-placed stone to take down a giant. Choose your weapons carefully and solely based on what do YOUR customers really want/need? The more a hosting company can be unique by providing value, as well as specialty, niche tools, the more firmly established it can become and remain.

You already have enough on your plate trying to increase revenue, decrease costs, combat churn, provide support, and the list goes on.

Adding payment processing to your existing services can either be a headache or a liberator depending on your approach. To ensure it is the latter of the two, it is imperative to completely think through the relationship with your chosen partner for payment processing.

There are two significant items to take into consideration: compensation and a non-competitive agreement. That said, traditional merchant account providers tend to cater to them both in a way that is very favorable for web hosts.

The majority of traditional payment processors offer handsome revenue sharing programs to their hosting partners and are eager to sign up new accounts while rewarding their partners for their contributions. For other providers, such as PayPal, that is not the case. While they offer a low-cost, affordable solution, and are a good fit for your customers that are just starting their online businesses, you won't be able to enjoy much additional revenue for referring them to PayPal.

PayPal's solution eliminates all set-up fees and monthly fees. The only revenue they generate from their merchants is from the 2.5% discount rate and $.30 transaction fee they charge for processing. The challenge is that 60% of all online merchants never process a dime. Therefore, the majority of accounts you refer will never process. And, you will never receive any additional revenue for offering ecommerce as a value-added service to your clientele.

The second piece to take into consideration is related to the actual agreement you enter into with your payment services partner. It is vital to ensure your partner agrees not to refer your customers to potential competitors. Again, traditional merchant service providers are typically very accommodating to this request and have no reservations about refraining from referring your customers to other web hosts.

However, larger providers, such as PayPal, don't usually go into as much depth with partner agreements. When a customer calls PayPal to sign up an account, they don't even ask if a web host referred them. In fact, when asked if they could recommend a cheaper hosting solution to switch over to, they suggested GoDaddy.com.

Bottom line: you should be thorough when choosing a payment services partner and entering into an agreement. It is important to ensure you are making the best choice for your particular needs as a web host. Partnering with a traditional merchant account provider gives you the ability to increase revenue while eliminating the potential threat of the 3rd party referring your customers to another host.

Offering eCommerce solutions in addition to web hosting helps you reduce attrition while enhancing revenue - and that's just the beginning.

Enhancing revenue is the goal of every business.

Likewise, many companies are concerned about attrition, or the loss of customers who take their business elsewhere possibly due to dissatisfaction, better offers from competitors, reasons associated with the customer life-cycle, etc.

If you're a web host, these are the issues that are often on your mind. Luckily, there's a way to tend to both, all in one step.

How? By adding eCommerce options such as payment gateways and shopping carts to your suite of products and services. Doing so can help maximize your relationship with existing customers, particularly if you currently only offer web hosting. It also makes you a more attractive option for potential customers looking for such a comprehensive solution.

Enabling online sales has an obvious, enormous, and immediate benefit to your client: More sales. But the benefit to you is also significant. A revenue increase means your clients' company will grow, opening up opportunities for you to provide them with more services in the future. Additionally, by partnering with merchant service providers you receive healthy incentives for each account that gets set up through you (generally ranging from five dollars to a percentage of the total bankcard processing for the accounts in question). So, you generate more revenue by earning a portion of whatever is spent through your client's website, which increases your average revenue per client (or average revenue per unit). And it gets better. By offering online payment services, you can also reduce attrition (or "churn rate").

A case in point: Consider the website mareorganic.com. This site's original purpose was to post basic menu and restaurant information. As time went on, the site's handlers decided to enable it to accept payments for gift cards. It went from a static page and little more than an online information source, to a powerful revenue-generating tool - without initially intending to do so and while staying with the same hosting company.

The lesson? Every website has growth opportunities waiting to be unleashed. Most are going to eventually get an online payment method. And if you don't offer it, they'll find it somewhere else.

Simply put, offering eCommerce solutions to your customers increases your value to them. Why be a company that just hosts websites when you can be a full-service Internet partner to your clients? They'll be more likely to enter into bigger and longer contracts with you, and more likely to stay with you instead of switching over to another host. After all, if a company already trusts you with their web hosting needs, it's a logical step to move that relationship into a situation where you also handle their email accounts, payment services, shopping carts, and much more.

Once your clients start taking advantage of these additional services, they'll be much less likely to seek out other vendors when it's time to take the next step. The goal, then, is to convince your customers that by partnering solely with you, they'll save and have the ability to grow.

And with a powerful eCommerce platform, that's a promise you can keep. You'll be able to enjoy the benefits of a win-win situation; your customers will be satisfied and you will generate more revenue while reducing attrition.

When reaching out to your small business customers about their websites, there's one question that towers above all others: Does your site accept credit cards?

It's simple: Websites that don't accept credit cards aren't doing their optimal level of business. Period. Customers love the convenience of using credit cards; it's what makes online shopping so appealingly easy. So, if your clients' websites can't accept credit cards, there's a good chance they're missing out on a substantial amount of business. And that, of course, is unacceptable - for you, and for them.

It's an important issue, but not necessarily a simple one. There are many reasons why some online businesses resist adding credit card processing to their websites. Many times, it's a matter of mindset - they're in "small business" mentality, not realizing that an online business doesn't suffer from the same size restrictions as a brick-and-mortar store. (Some, yes; but not all.) Other times, it's a simple safety concern. The statistics on identity theft are staggering, and most consumers are very aware of the danger of having their credit card information - or other sensitive data that's submitted during a purchase - stolen.

(Late last year, the non-profit Identity Theft Resource Center published a report stating that identity theft occurs about every 19 minutes in this country. The report cites the U.S. Bureau of Justice Statistics as stating that "an estimated 3.6 million households were affected by identity theft during a 6-month period in 2004". Such sensitive information is often stolen directly from less-than-secure online data, as many people know. In fact, a poll that showed a staggering 91 percent of the American public are aware of and concerned about this trend. Read the entire report here.)

That's why it's so important to be able to offer your customers the very best, the very safest in payment processing services. If your processing service is proven to be safe and secure, you're giving your customers a measure of safety and security that's sometimes hard to come by.

So be sure that the service you offer can handle a task that monumental. Cutting corners will hurt far more than it helps. Luckily, there are professional companies (such as the company I represent, InternetMerchant) that specialize in providing this service safely, securely, and quickly. When it comes to credit card processing, or ANY kind of payment processing, I recommend finding a partner like InternetMerchant to take on the burden of safety, leaving your customers free to focus on their business with confidence and peace of mind.

Read more on this topic here.