June 12, 2012, 11:59 AM

UPS ties technology to Bridgeline Digital’s e-commerce software

The companies co-market an e-commerce platform with UPS warehouse management.

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Many retailers use UPS for shipping services, and now the biggest carrier for Top 500 online retailers has an exclusive arrangement to offer its warehouse management system pre-integrated into the e-commerce software suite of technology vendor Bridgeline Digital Inc.

UPS and Bridgeline announced the integrated software at the Internet Retailer Conference & Exhibition 2012 last week. The announcement follows a year of building a technology framework to ensure that consumer orders received on the Bridgeline e-commerce platform would flow smoothly to the UPS warehouse management system, the companies said in an interview with Internet Retailer at the conference.

Alan Amling, vice president of marketing, global logistics and distribution, UPS Supply Chain Solutions, said that, despite its dominance as a shipping carrier among large online retailers, UPS realized it needed to offer more technology options. “Our customers led us to this,” he said. “Some went away after we didn’t offer full end-to-end web store and fulfillment technology.”

The arrangement with Bridgeline Digital, he added, marked the “first time we’ve integrated an order management system to our warehouse management system.” The system is geared to processing orders of packages up to 75 pounds.

UPS is the most common shipping carrier among the largest 1,000 online retailers as listed in Internet Retailer’s Top 500 Guide and Second 500 Guide, with 419 clients, followed by the U.S. Postal Service,  with 321, and FedEx Corp., 303. For fulfillment services, however, UPS and FedEx each list only one client among the Top 500, and none in the Second 500.

Bridgeline Digital offers the iAAPS Commerce product, an Internet-hosted software suite built on Microsoft .Net technology that includes modules for an e-commerce shopping cart, web analytics, content management, and online marketing capabilities. The integration with UPS extends that suite, which Bridgeline markets as Total eCommerce, to connect with the warehouse management system and fulfillment services offered by UPS Supply Chain Solutions.

The cost of the full integrated software suite from Bridgeline, including all licensing and services, starts at $150,000, or $1500 to $5000 per month for an Internet-hosted, software-as-a-service version. “A typical Total eCommerce deployment,” Bridgeline says, “can range from $150,000 to $500,000 in iAPPS licensing and web store development services.”  That includes the integration with the UPS warehouse management system.

Using the separate services of UPS Supply Chain Services, including warehousing and fulfillment technology and services, ranges from $150,000 to $1 million depending on things like order volume and shipping commitments, UPS says.

UPS and Bridgeline say they’re targeting companies with total annual revenue of between $25 million and $250 million, with as little as 10% of that online.

Industry experts say the integration with Bridgeline offers UPS both a way to attract more retailers and better compete against eBay Inc., which offers integrated e-commerce and fulfillment services through its GSI Commerce unit. Through its X.Commerce initiative, eBay is also working to bring more integrated e-commerce and fulfillment technology and services that include its Magento e-commerce software.

“This says to me that the smaller end of the e-commerce market is really heating up,” says Nikki Baird, managing partner of research and advisory firm Retail Systems Research LLC, adding: “This is a direct response to eBay/GSI.”

Indeed, Bridgeline and UPS also have other competition in a growing marketing for integrated e-commerce, warehouse mangement and fulfillment services, adds Gene Alvarez, vice president and retail technology analyst at research and advisory firm Gartner Inc. "This is good for Bridgeline as they can offer this to organizations that do not have warehouse management system or fulfillment capabilities,” he says.  “The deal supports a growing trend that there are organizations in many industries seeking e-commerce solutions that include warehouse management system and physical fulfillment capabilities.”

But Bridgeline and UPS aren’t alone, he adds. In addition to GSI Commerce, “vendors like Demandware and PSFweb, Venda and Quiet Logistics, and others have an offering like this one,” Alvarez says.

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