Traditionally retailers looking to go online have had three main roads to choose from; custom site development, prepackaged software integration or a hosted solution.
Pazanga now offers a different route. The Los Angeles-based company offers a proprietary e-commerce platform customized for brick-and-mortar retailers. Around a software hub, Pazanga provides legacy systems integration, hosting, consulting and development.
Adam Lilling, Pazanga's founder and CEO, hopes traditional retailers pause to consider his alternativeââ,¬"especially now that the dot-com craze has cooled. The rapid rise of online merchants dazed the brick-and-mortar world. But Lilling believes retailers may be at the point where they can devise online strategies that are more than just a knee-jerk reaction to the latest Web-store launch.
"Fear has driven this market for the past 18 months," he says. Against that backdrop, Pazanga targets mid-market traditional retailers with annual sales of US$50 million to $1.5 billion. The company is looking to lend a hand on both first generation e-business projects and second-generation redesigns. The company's largest customer is Virgin Entertainment Group's Virgin Megastore Online, a strategic investor, as well as a client.
Value Offered
Pazanga's value proposition for customers is reduced deployment time. Because it doesn't have to piece together a solution based on disparate components, Pazanga says it can deploy its platform in three to four months.
Pazanga's e-commerce platform offers customer service, fulfillment and security among other modules, providing a single database of consumer and catalog information. It can be customized and integrated into a retailer's back-office and the point-of-sale systems. Pazanga hosts the platform and offers ongoing consulting and development services, as a consequence, the company generates revenue from up-front consulting and integration fees, monthly hosting fees, and platform modifications.
Lilling describes his company as a fusion services firm, an e-business category International Data coined earlier this year. Such firms, according to International Data, provide "a happy medium" between ASPs and solutions integrators.
And along that middle path, Pazanga expects to find its niche. What's In It For You?
Pazanga plans to tap strategic partners to provide elements of its e-commerce solution and help with marketing. Currently, Pazanga co-locates its Sun servers at Level3 and has partnerships in place with eManage.com and Muze, among others. But the company is working on three to four additional alliances in hosting, fulfillment, design, and other related services, Lilling says.
