Wednesday, June 17, 2009

Failure of Boo.com and its causes


Nowadays there are a lot of people using e-commerce to do their business. This is due to its convenience for those people who are working or prefer to start their own business and does not have enough capital. E-commerce also knows as electronic commerce. There are a lot of successful in e-commerce companies such as eBay, Amazon, yahoo and Google. However, on the opposite side there are also have companies that are failure such as webvan.com, pets.com, etoys.com and etc.

Therefore, at here we will discuss about the failure of Boo.com and its causes.
Boo.com was a European company founded in 1998 and operating out of a London head office. The founded of Boo.com are three Swedish entrepreneurs, Ernst Malmsten, Kajsa Leander and Patrik Hedelin. The main business of Boo.com was selling branded fashion over the internet and as an online fashion store. The customer range that they target was from 18 to 24 year olds.




Boo.com wills failure because they did not carefully plan their business by considers the 4 P’s (Price, Product, Place and Promotion) and the environmental factors. Boo.com was surrounding by many problem and they mismanage it. Many of the customer criticized that the website was too complicated and the design was very poor. This is due to the site was heavily relied on the JavaScript and Flash. Therefore, the home page will require several hundred kilobytes to load it but at that time many people used dial up internet and broadband technologies were still not widely been use. Therefore, the users will have to wait for long time to load the page. Otherwise, the website also not usability because the user difficult to get where they want to go. Other than that, the complicated design required the site to be displayed in a fixed size window. This will limit the space that available to display product information to the customer.

Boo.com had a policy of “limiting the amount of transaction they made to three per twenty minute” which will discourage customer to shop at Boo.com again. They had spent 125 million in just 6 month to market itself globally but had issues with different language, prices, and tax. If there are return items from customer, the company will help them to pay the postage. This had proved that, they did not manage their capital effectively. Finally, the end of boo.com came on May 18th 2000.
References:



No comments:

Post a Comment