December 15, 2010, 4:18 PM

Market America to acquire Shop.com

Shop.com is among the last original shopping comparison sites to merge or be purchased.

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Online retailer and marketplace builder Market America is jumping into the shopping comparison site business via a big acquisition.

This afternoon Market America, No. 54 in the Internet Retailer Top 500, acquired Shop.com, a shopping comparison site, for an undisclosed amount.

Under the terms of the deal, which is expected to close by the end of the month, Shop.com will continue to operate as a separate web site, says Market America. “This unique strategy positions us for explosive growth and to compete head-to-head with the biggest, most dominant shopping sites on the Internet,” says Market America CEO James Ridinger.

Market America, which generated web sales of $321.3 million in 2009, is acquiring Shop.com for its search and OneCart checkout technology and for its base of 2,000 affiliated merchants. “Market America and Shop.com are online shopping pioneers with distinct areas of expertise,” says Shop.com CEO Ken Goldstein, who will depart his current role and become a strategic advisor to Market America after the deal closes. “By bringing our companies together, we are creating a game changing shopping experience with transformative potential to our customers, retailers, consumer brands and business partners.”

Market America also is making the acquisition to apply its personalized merchandising strategy to Shop.com’s broad base of well-known retailers such as Best Buy Co. Inc., Bluefly Inc. Buy.com Inc.; Cooking.com Inc.; drugstore.com Inc. Gap Inc., J. Crew Group Inc., Macy's Inc., Nordstrom Inc. and Barnes & Noble Inc. In November 2009 Market America rolled out its “Paid to Shop” program that awards customers 2% back on all purchases made on MarketAmerica.com and its sister sites. The cash-back offer is good on purchases of more than 35 million products available on MarketAmerica.com, including Market America’s own branded products and items offered on the site by thousands of partner retailers including The Home Depot Inc., Target Corp. and Saks Fifth Avenue.

“To date, no one has truly harnessed the power of technology to provide a high-touch, personal shopping experience combined with the depth of selection available through instant search of the more than 43 million products in our database,” says Ridinger. “Our business model rewards customers at every stage – by making their shopping easier and more efficient, and rewarding them with cash back for shopping with us.”

Shop.com is among the last of the original shopping comparison sites to merge or be acquired. In June 2005 E.W. Scripps Co. paid $525 million in cash to acquire Shopzilla Inc.; eBay bought Shopping.com in August 2005 for $620 million; Experian acquired PriceGrabber for $485 million in December 2005; and venture capital firm Providence Equity Partners acquired a two-thirds stake in NexTag in June 2007 for $830 mililon.

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