Post by Jaeme, 18 June 09 @ 9:35pm
One of the companies that failed in E-commerce is Boo.com. Boo.com was a United Kingdom internet company founded by Ernst Malmsten, Kajsa Leander and Patrik Hedelin. Boo.com was launched on 3rd November 1999 and their intention was to sell branded fashion wear over the internet.
According to “Financial Times”, Boo.com incurred a lot of consultancy fees to get the website launched. When the site was eventually available to the public, the customers felt frustrated to shop on their website. Miss Boo who was the online virtual shopping assistant failed to help customers with the purchasing experience. Customers faced slow browsing, poor navigation and lousy technology. This was a major problem for the company and Boo.com resulted in bad reputation. On 18 May 2000, Boo.com went into liquidation and was placed into receivership. Now, it is owned by Web Reservations International.
Major causes that resulted in the failure of Boo.com:-
1. Poor Web Design and Usability.
- The site relied heavily on JavaScript and Flash technology to display the 3D views. At that time, User’s internet connection did not have such high bandwidth (56K modems and above) for 3D viewing. Consumers have to wait for a long time for the site to load. Besides that, the site was display in a fixed size window which limits the space of displaying the products’ information. Boo.com also placed a limit on the amount of transactions a consumer made. This resulted in the lost of potential customers from their website.
2. Bad marketing
- Although Boo enable consumers to view the products in 3D image, they were unable to set attractive products prices. Studies sponsored by KPMG, Hewlett- Packard and VNU Publications showed the three importance of web purchasing in; UK – “Ease/ Convenience”, “Better Prices”, and “Speed of Process”. However, Boo.com did not fulfill any of these three criteria.
3. Bad planning.
- The Swedish founders of Boo.com were too ambitious in their business plan as they wanted to expand their business into internet marketing immediately, instead of starting from a small business. This lead to the failure of their company.
4. High Maintenance Costs.
- The company was unable to cover its construction costs which incurred a high maintenance expense of five thousand pounds a month. The cost was used in creating 3D photographs of the products in the web.
For a company be successful in e commerce, their website should be launched only if it has been strictly tested. Besides that, companies should implement the most effective method to advertise and promote their website and products. Furthermore, an e Commerce Company can maintain consumer loyalty by offering rewards and discounts on their products.
References:
http://www.edigitalretail.com/Most_Famous_Dotcom_Failure.pdf
http://www.bookrags.com/wiki/Boo.com
4 comments:
can you provides others examples of e commere success?
can you provides any others examples of e commerce failure?
never heard about boo.com one, is it really famous?
i believe that not so many people know bout boo.com but it is really a company that fail in e commerce.
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