In a deal that will combine the resources of a major supplier of e-commerce software with those of an online marketing firm, NetSuite Inc. signed an agreement today to purchase Bronto Software for $200 million.
NetSuite provides order management software to 15 merchants ranked in the new Internet Retailer 2015 Top 500 Guide, including Bed Bath & Beyond Inc. (ranked No. 80), Groupon Goods (No. 30) and PureFormulas.com (No. 401). It also supplies customer relationship management (CRM) and fulfillment services to many of those retailers, and 27 e-retailers in the 2014 Second 500 Guide use NetSuite’s order management system and other services.
In total, the company says more than 3,000 business-to-business and business-to-consumer companies use its SuiteCommerce e-commerce platform. More than half of those customers are B2B, and last year it launched a new set of B2B software tools for its SuiteCommerce e-commerce platform.
In combining the marketing capabilities of Bronto with the e-commerce platform, order management and inventory visibility of NetSuite, the companies believe they have a unique opportunity to enable retailers to market to customers more effectively, Bronto CEO Joe Colopy and NetSuite general manager of commerce products Andy Lloyd tell Internet Retailer.
“Going forward, think about a retailer that’s sending out email marketing to their customer list,” Lloyd says. “They have specific items they want to market to that customer. If they send out the exact same email to all clients, they may be promoting an item that’s not in stock in the store a mile down the road from some customers. Now you’ll be able to do things like send email to consumers that takes into account not only their purchase history, but also things like what’s in stock in a local store.”
The companies will operate separately, and both are planning major hires. NetSuite plans to add 1,000 employees this year, Lloyd says, and Bronto is on track for an additional 100 hires, mostly at its headquarters in Raleigh-Durham, N.C.
Thirty-seven merchants in the 2015 Top 500 Guide, including JustFab Inc. (No. 98), Nasty Gal Inc. (No. 112) and CafePress.com (No. 140), and 67 merchants in the 2014 Second 500 Guide name Bronto as their email marketing provider. (The 2015 edition of the Second 500 Guide will be released in mid-May.)
“This combination, for the first time ever, ties a rich marketing automation system with a cloud-based omnichannel commerce platform,” says NetSuite CEO Zach Nelson. “By combining the two companies’ offerings and technology, we can help merchants deliver relevant and consistent digital commerce experiences throughout the customer journey.”
The deal is expected to close in the second quarter of 2015.