December 16, 2005 -- (WEB HOST INDUSTRY REVIEW) -- Web hosts often outsource the many different products and services they market on top of their core hosting services to third party vendors. But hosts with strong financial backing have the option of acquiring those companies and integrating their capabilities.
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Rather than continue its own e-commerce outsourcing arrangement, Web hosting provider and domain registrar Network Solutions (networksolutions.com) exercised its financial clout on Friday with the announcement that it had signed a definitive agreement to acquire e-commerce solutions provider MonsterCommerce (monstercommerce.com) for an undisclosed sum.
Network Solutions began looking to acquire an e-commerce vendor because it had become increasingly dissatisfied with its outsourced provider, Champ Mitchell, chairman and CEO of Network Solutions, told the Web Host Industry Review. "It just wasn't a good solution so we had to go find one that was, and that we could take control of to make sure the customer experience was good. That was our motivator."
Mitchell says MonsterCommerce had the best technology. And its enthusiastic management team and staff, led by general manager Stephanie Leffler and president Ryan Noble, intrigued Network Solutions as well. Most importantly, the MonsterCommerce shared Network Solutions commitment to customer service, a focus the company has worked hard to develop over the last few years.
"One of the reasons I was so excited about MonsterCommerce," says Mitchell, "was that they have the same attitude towards customer service as we do."
But Network Solutions got more than just basic e-commerce capabilities. MonsterCommerce also provides customers with online marketing, search engine optimization and basic Web site building services. Each, conveniently, was a service Network Solutions was currently outsourcing and had targeted for future expansion.
"We went out looking for e-commerce and found a solution," says Mitchell, "and then found that we could get e-commerce plus several other core products that we wanted to gain control of - [and] had on our roadmap - and we got it all in a package."
Of the four core competencies Network Solutions is acquiring, Mitchell says search engine optimization and online marketing are currently seeing the strongest demand. He says there are still a large number of small businesses that have no intention of selling online. All they want is a Web presence that enables them to be found online and these offerings are geared precisely for that segment of the market.
Network Solutions does offer online marketing services such as search engine optimization, but it plans to quickly replace its current vendors with MonsterCommerce's products. "They are just better," he says.
Products and services that fit with the Network Solutions family will be re-branded, but remain firmly in MonsterCommerce's hands. "The product will be provided by Monster and they will maintain the quality of the product," says Mitchell. "We'll handle the sales and customer service." Everything however, will run off the same back end.
The acquisition also enables MonsterCommerce to enjoy Network Solutions services. Mitchell believes many MonsterCommerce customers will be interested in Network Solutions' email services. And while they may not be as interested in the company's "pure" Web hosting services, Network Solutions still plans to take over the hosting currently integrated with MonsterCommerce's e-commerce offerings. MonsterCommerce does the hosting itself but outsources the infrastructure management to Rackspace Managed Hosting. Mitchell says the company will be migrating the operations to its own data center. The process is expected to take at least a few months in the near year.
The MonsterCommmerce brand will be maintained with the tagline "a Network Solutions company." An 80-person management and staff team will remain stationed in Belleville, Illinois and the support headcount will increase sharply in the coming months. Mitchell says the sophistication of the MonsterCommerce line and the unfamiliarity on both sides will require extensive training, which will be driven by the company's central focus of maintaining and continually improving customer service.
