December 26, 2000, 9:55 AM

Give away hosting, make it up in ads

How many retailers are selling online? The number just grew by 1,000.

In July, Redwood City, Calif.-based Excite@home began offering free hosting to small retailers hoping to set up their first online store. Excite immediately signed up more than 1,000 merchants. “It was beyond our expectations,” says Dan Odette, Excite Business Applications’ vice president of marketing. “Obviously, people like that it’s free, but also that it combines services they would otherwise have to source from a number of places.”

Excite’s Freetailer service is aimed at businesses with fewer than 50 employees, from mom-and-pop, storefront merchants to one-person, home-based enterprises. “Most of those folks aren’t on the web, yet,” Odette says.

What’s in it for Excite? Revenue from banner ads on clients’ web sites, and from the sale of upgrade services such as domain name registration, POP email accounts, a credit card merchant account and a payment gateway. Excite is also offering live customer interaction through RealCall, merchant Web site verification and consumer protection services through WebAssured, and merchant sales analysis services via One Channel. The basic service offers a cash register, shopping cart, the ability to accept checks, COD or money orders-“everything you need to put up a fully functional store online,” Odette says.

Tracey Smith, a home-based publisher of personalized children’s storybooks, who has been online since February, was among those signing up for a merchant account. Smith is just the sort of retailer Excite is looking for: she was attracted by the ability to take credit card orders and says she will probably become a paying customer. “I looked at a lot of hosting companies; the features Excite offers are a good deal,” she says.

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