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The Almighty Buck

Boo No More 208

morn writes: "Boo.com, European 'flagship' e-commerce sportswear store (maker of the distinctive 'geek in sportswear' TV and cinema ads) and largest Internet retail funding ever in Europe has financially collapsed, causing 300 job losses, according to this story by BBC News. The boo.com site is still up, and there are hopes that the firm will be taken over by a more established company. Nevertheless, it begs the asking of this year's favourite question - is this the beginning of the ecommerce bubble bursting?"
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Boo No More

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  • I dance a merry jig upon the grave of boo.com.

    I interviewed for a junior help desk position with boo.com last fall when they were getting their NY office together... I thought the interview went really well and I even fixed the HR Director's Outlook setup. I was told that a second interview would take place when the VP-of-Tech-or-whoever got back from his honeymoon (who takes vacation in the midst of a crucial launch period?)

    Naturally, the call never came. I tried to find out what was up through the Pimping Agency I was dealing with, and couldn't get a straight answer. Once the site was formally launched, I looked at it once and was glad not to work there. Apparently fancy LCD desktop displays and posh SoHo loft office space aren't sufficient for running a business

    I ended up at a large, well-funded company a couple months later, and boo.com ended up broke. I WIN!

  • by Anonymous Coward
    "It" is not like a normal store, since you cannot inspect the actual product and returns are more inconvenient. Mail order houses generally have sourcing advantages (i.e. they are manufacturer outlets). Also note that the mail-order market is very limited.

    Furthermore, it is very meaningful when one of the most prominent and well-funded online stores goes belly-up. This is not "Joe & Bob's Annual Going-out-of-business sale." This is some serious shit. Investors have long assumed that having a well-established name and large-scale operation would be a major advantage in internet sales. This is incredibly strong evidence that big plans ain't enough.

    My personal opinion: e-businesses can succeed. But the one vital ingredient is good management. A business must start small with a working plan, and build up from there. Walmart wasn't built in a day.
  • Nobody has made money doing clothing retail on the web. It just doesn't work. Maybe once we've got total immersion five-senses buzzword-compliant VR dongles it'll work, but for now nobody wants to buy a potentially poor-fitting ugly-in-real-life article of clothing. Even Levi's, with a relatively standardized product array, ended up pulling the plug on its eCommerce site last year.

    Sure, the internet bubble will burst, but this won't be the incident that issues the clarion call. Right now what we're seeing is a bunch of people throwing money at untried and often nonsensical business plans just necause it involves the net. We've got to wait for some heavy hitters to run our of capital before we see a collapse.

    butidontneedmytoothpasedelivered.com

    -carl
  • It meant "advanced" as in using every advanced technique in the book. Java applets, flash, javascript effects, lots of gifs, you name it.

    Sure, teh design loooked good (if you could get to it) but their solutions put a lot of obstacles between their products and their would be customers wallets. That is seldom a good business practice ;-)

  • Last August or so IIRC the fashion magazines were filled with editors singing the praises of Boo.com. They'd all bought Prada shoes there, it was new, it was hip, it was high-tech, all the "in" people were shopping there etc. The only problem was, even as the magazines were on the stands (never mind at the copy deadline), the website was not yet up. Must have been real tough ordering those Pradas, huh, Ms. Editrix?

    Once it did go up, months later, the few from alt.fashion who returned after that debacle warned the rest of us of browser crashes a-go-go. Goes to show that word-of-mouth can work against you, too.

  • by Matts ( 1628 ) on Thursday May 18, 2000 @05:35AM (#1064160) Homepage
    The telecom monopoly BT justifies it by making massive profits for its shareholders (profits are in excess of £1m a minute or something ridiculous like that).

    The other telecoms operators (UUNet, NTL, etc) decide that it would be real nice to make a similar profit, rather than providing cheap internet access, and so charge similarly.
  • c|net is reporting that >en. [cnet.com] (Digital Entertainment Network) has informed its staff it won't be able to make its payroll. The site has retained an investment banking firm to start looking for a buyer.

    It's another site that suffers from over design.

  • by daviddennis ( 10926 ) <david@amazing.com> on Thursday May 18, 2000 @05:45AM (#1064162) Homepage
    when this started to hit.

    I have a 144k DSL connection at home, and it was dog-slow even on that. It did have a tool to measure my data rate, and it claimed I had a 53k data rate, which was marginal to check out the "full" version. I went with the "full" version anyway because I was curious to see what it was like.

    A clue as to the vast usability problems that were found on the site is that their "tour" was a condescending highlight-and-display of every single menu option on the site. It was slickly done, but too boring for me to sit through.

    The actual shopping experience was sluggish, and despite using the high-bandwidth option, the product images were not large or distinctive enough to give me a good sense for what I would have been buying.

    This whole thing reminds me of a friend of mine who created a very similar Javascript-laden "remove all control from the user" site. His site, like this one, was just about impossible to navigate. I felt a strong dislike for his approach, and I didn't feel any better about Boo, despite the massive budget.

    I can surely shed a tear for the people who worked night and day trying to push this thing together, but as far as I can tell the site was, and still is, fatally flawed.

    D

    ----
  • Perhaps the main reason for boo's failure is that it's hard enough buying clothes in real space, let alone on the web. Clothing is all about the combination of the specific item with a specific person's body, posture, ways of moving... Not even with a full cyberware body scan and the latest VR fabric engine would I commit to buying something to wear electronically. Books, software, music, food, lots of things, but not clothes, unless I was just buying a new one of something I already had.

    The overly-technical website didn't help, true. In UK, at least, most potential customers hve 56k modems, if that. I couldn't get the thing to work even with a current M$ browser. But there are darker things to come. A friend who works in web design tells me the buzz now is all about richmedia. By which they mean loud banners that scramble all over the screen shouting out their soundtracks. In a battle for our consciousness, they're simply upping the noise to signal ratio.

  • They also had some inventory problems, selling summer clothes in winter. Smart.
  • Yes, Internet connections are more expensive in Europe. But costs for staff and offices are completely insane in Silicon Valley. I doubt the Valley has any cost advantage all in all. It's certainly at least twice as expensive to do business in than normal US locations.

    And still it dominates the industry. Not sure why.
  • Late last year I was working/chilling in a web developers server room and heard that boo.com had been hemorrhaging. There was mention of 10's of Millions of ££££££ being used to shore up the company. So when such ecommerce companies suffer financial collapsed it causes ecomonic ripples, something to think about when aproaching your bank manager for a ecommerce loan.

    Guess I should'a placed puts against the stock
    bty: 20ish NT4.0 servers and 2 token Linux boxs(1x DNS, 1x Quake2 Arena)
  • I visited boo.com when the over-hyped site was announced and was appalled at once of the incredibly stupid web-design -- or lack thereof. It was just a huge bloat of features and useless animations (can't remember any MIDI or sfx, but then again I only have a headset so I probably didn't notice). Even though I am on a fast line, it was slow as hell and left little power and choice to the visitor. There was no way of browsing their pages through text-only HTML and HTTP. I remember thinking that if they don't change their webpage, they'll surely go bankrupt, or at least I hoped so.

    Even their marketing strategy I couldn't understand. Why would people want to buy _sportswear_ over the Internet? That's one of the last things you'll want to buy unviewed and untried. Consumers in this product-area is very selective and sensitive. You'll want the right colour, size, brand and in most cases you'll want to _try_ out to see what you like. Think of shoes for jogging for instance! This is all very individual.

    All in all, I'm pretty happy my conclusions at that stage were correct. Not because it could never become a success, but because they violated so much regard for consumers that they truly deserved this!

    This should be a lesson to all that simplicity, flexibility and choice are three fundamentals of success in design in _all areas_. You may add as much bloat and features you like, but regarding these fundamentals will eventually scare people away. This is just one very horrific example, more will hopefully follow in the future. People will learn to avoid bloatware, since it's a cause of stress and disharmony.

    - Steeltoe
  • lets see...
    • big selection of stock that a real shop would find it hard to display, its the net so u can have a stock catalogue of 1000s and 1000s of items!
    • reaonably quick and intuitive site, eye candy is fine if it doesn't detract from use
    • backengine up to speed, that means transaction processing, security, info for clients, well thought out forms et cetera
    • consistent navigation
    • doesn't require me to have plugins and the latest browsers to use, maybe for value added stuff but not for stock searching and buying stuff
    now thats what tends to be the case on sites that i spend money on, boo did not share much of this. nuff said really.
  • Looking at boo.com, there are a number of things that adds up to failure. The first thing I was aware of was a major mistake technology-wise. They made a mega-hip web site that was simply too difficult to use for people to buy from them. I once heard how much this first version had cost them to produce and I think it was somewhere around $10M.
    This should of course be plenty reason enough to get warning signs up. Anyone spending millions of dollars on what must be considered the core of the company and not having the knowledge to make sure it's functional is not someone I'd trust with my money. If it was a car company, there wouldn't have been a second chance.

    Another thing you might want to consider is their business idea. Buying clothes online? Esp. relatively expensive clothes. Myself, I like to try clothes on first unless we're talking socks or t-shirts or the like. On the other hand, if I'm about to spend $100 on a t-shirt, I might want to have seen it first. Of course mail order companies have been selling clothes in a similar fashion for some time and are doing quite well. Maybe it's about the price or maybe it's simply that they know something about selling "on distance" that boo.com didn't know or care to find out?

    The last and final straw is their marketing. Half of their spendings have been marketing related. That's over $50M in one year. This should be enough to brand your name in any small or medium-sized country. But what do they do? they market themselves everywhere at the same time. Really. I'm no marketing guru but wouldn't it have made sense to pick out one market or possibly two and start there and then conquer the markets one by one?

    I doubt this is the end of e-commerce. But perhaps (we'd be so lucky) it will get people to start thinking about reality instead of thinking that the "e-commerce market" is a place wher eyou don't need to use your head to make it big. And perhaps venture capitalists will start demanding proffesional lead for companies they fund.
    It's a nice thought.
  • I went to boo.com and it asked me to select a country, I selected "Spain" from the list because I didn't see "Espana" Y puedo hablar Espanol tan bien como cualquiera otra persona.
  • The US offers the most freedom to its people -- yes, including the freedom to go broke and lay off and fire people, who then have the freedom to have no healthcare and not enough food.

    you call that freedom? in the US we have the freedom to be a wage-slave [deoxy.org]. why do we work soooo much? [deoxy.org]

    nmarshall
    #include "standard_disclaimer.h"
    R.U. SIRIUS: THE ONLY POSSIBLE RESPONSE
  • Good lord, most brick and mortar stores with prices like that would go out of business. I saw a skirt for $380! Web shorts were like $40!

    What crowd are they aiming at? The extremely affluent who like to pay more than they should for relatively inexpensive fasions?
  • Here [gladwell.com] is a pointer to an excellent article by the equally excellent Malcolm Gladwell [gladwell.com], recent author of The Tipping Point [gladwell.com], in which he discusses the history of mail order and e-commerce, and provides an example of how one company does it right (hint: they had already mastered the 800 number by the time the Internet came along.)

    While I'm at it, I highly recommend everybody read everything at his site. His choice of subject matter is unique, his scholarship is impeccable, and his writing lucidly conveys complicated ideas.

  • by seldolivaw ( 179178 ) <.me. .at. .seldo.com.> on Thursday May 18, 2000 @02:55AM (#1064174) Homepage
    I admit that I, too, temporarily gave this event more significance than it really merits: an e-commerce company is collapsing! Help! The bubble is bursting! Get out now! Sell! Sell!

    But it's not like that. Boo was a badly mismanged site -- their launch was delayed by five months due to technical problems, and they spent way too much on marketing (surprise!).

    People have forgotten than 90% of Internet companies are supposed to fail; only 1 in 10 business startups of any kind last more than a few years. It's just that a whole load of Internet companies started up at the same time in the big, big boom last year and now the weaker ones are beginning to fail, but there are a lot of them. Investors got this idea that a Dot-Com was a sure investment, guaranteed to make them rich, and that's not true. Business sense, a solid business model and good management matter as much as they ever did. Amazon.Com is run by a businessman, not a geek, and that's usually the case for sucessful technology companies (e.g., um, Microsoft? Bill's more businessman than geek).

    Unfortunately, no one will listen and even really good e-commerce ventures are going to have a tough time getting VC in the next twelve months. Eventually, it'll level out and there will be no difference between getting VC for an online business and an offline one (in fact, since all business will be online in some way, there will be no difference at all).

  • This is quite off topic, but here we go..

    I really think that while socialism might hinder the economic growth (and economic growth is not necessarily a "good thing"), it is great at keeping the gap between the rich and the poor small. Socialism done correctly is probably the biggest reason that there aren't people without food here in Europe.. (Well, mostly.) What's the use of having a small unemployment rate if it means that some people have _no_ money at all? It's better to distribute wealth more evenly, if only a bit.

    Call me a leftist, it is what I am.
  • The ecommerce bubble has already burst on Wall Street. The capital which supports new ecommerce companies is drying up. The reason is that the technical barrier to entry into the web retail market is very low. Ecommerce sites cannot maintain any advantage over established retailers. Sears, Walmart, Kmart, etc have all established web retail sites that are competative with the pure ecommerce plays like amazon.com or etoys.com.
  • Yeah, the story's getting a bit stale, but I thought this article [salon.com] on Salon was interesting.

    "The fashion retail site Boo.com was laid to rest Wednesday, after reportedly burning through $120 million in a mere six months. The Web's first immersive retail environment had its own online guide (Miss Boo), its own online magazine (Boom) and some of the hippest clothing brands. But it was wildy overdesigned, difficult to navigate and completely out of touch with most Web retailers' vision of quick shopping and ease of use."

    - eddy the lip

  • by Chalst ( 57653 ) on Thursday May 18, 2000 @02:56AM (#1064178) Homepage Journal
    One of the reasons cited in the article for Boo's collapse is `overly
    complex websites', that most customers could not read. Some meat to
    the `Viewable with any browser' campaign methinks...
  • I cringed at the notion of an Internet defined by commertal protocalls.
    Mind you the computer world was defined the same way but with one diffrence.
    Companys created files and formats they would document. Standards of the future (hopefully). For the good of all.
    But the notion of Commertal Internet Standards was standards controlled by the author. Closed standards. Undocumented.

    In the past users wanted to stick with software that used documented standards. They don't want to be locked into the application. If the program no longer dose what is needed they need an escape hatch.
    Todays users don't consider this escape. They think of now. If it works now it works for all time.
    However if a company has sufficent userbase locked into it they no longer need to worry about catering to the existing users and are free to presue other markets letting the old features decay in antiqity.
    This is the market today.

    Part of this is in the Internet. Web pages designed for two web browsers instead of working on all HTML4 browsers.
    Web sites with specal plugins that work only on one operating system and controlled by one company.

    This should not be the future of the Internet.
    I would like companys to rethink.
    Classic companys have larg doorways that are easy to get into and out of. Easy to do your busness and leave.
    Easy access for everyone.
    On the Internet it's whatever a web designners notion of "everybody" is. Everybody uses Windows.

    I talked with one designner. His idea was that the costummer base was wealthy and could afford high end computers and such so they wouldn't be using Amigas.
    But.. he forgets... Amiga users aren't cash strapped .. they are users who use the Amiga becouse that is what they want to use. If you don't wish to support them becouse of some notion of obsolete then Amiga users don't need to do busness with you.
    Such stereotyping notions of Amiga, Linux, Mac and Unix users is what is hurtting on-line busnesses.
    Linux users are not all techno geeks and ISPs, Mac users arn't newbes or dumb, Unix isn't just for techno elite and Amiga users arn't poor.
    I have a Dos machine at home set up as a web terminal. I don't need anything more than that for surfing the web. It dosn't do IRC it dosn't FTP very well it is still having problems picking up my e-mail. Thats not the idea.
    I just wanted a box to surf the web from home.
    Thats it.
    No Java, no streaming audio no specal media at all. Just Dos and Arachne.
    At work I have my Linux box.
    Thats what I put my money... in my Linux box (I am so rarely home it dosn't matter much).

    The notion that "Everybody uses Windows" is unrealistic.

    I'm hopping that at some point someone gets the message. Designe for everyone or stay off-line...
  • by jim68000 ( 8746 ) on Thursday May 18, 2000 @02:56AM (#1064180) Homepage
    Dr Spong is on the money: e-commerce is just mail order in fancy dress. This scored against Boo from the very beginning: they were attempting to sell a product that had never worked in mail order in Europe before. There are plenty of direct sales clothes retailers, but for specialised niches (extra-large, extra-small) or just cheap, but none selling heighth of fashion stuff.

    Moreover, Boo attempted to launch as a fully fledged multinational, with 300 staff and offices all over the world. It over-engineered its front-end - whether this drove customers away is an issue i can't answer but it certainly took a chunk out of the $135m startup capital by launching over three months late.

    It isn't the end of e-commerce: it's just yet another bad business idea, badly managed, by inexperienced managers, that spent too mcuh too quick. There's a surfeit of these on the Net now, - expect a spectacular crash every few months. But the idea of e-commerce is still sound, it's just the number of jokers getting VC for a used toilet paper B2B exchange that's the problem.

  • There is no java on the front end. The front end's all html, javascript and the odd flash animation (upon which no functionality is dependent).

    I think you'll find that almost every major sunday supplement has had full page colour ads for boo.com. The TV and radio ads were also highly prominent (assuming you watched or listened to the kind of programs that, in general, appealed to boo's target market).

    tam (~boo)

  • I said that my country was Suomi and I got Finnish. Looks like it is in your local language.
  • Many of your points are valid. However:

    it asked what country you were in. This was idiotic, given that the largest pool of visitors were in the US.

    This isn't true; boo was highly advertised in Europe so had a far higher European visitor ratio than most .coms have.

    Why ask the country up front? Why not wait until late in the transaction?

    Because one needs to know how much something costs before deciding to purchase it. And your currency can only be defined if the site knows which country you're in. That was the whole point - to have prices in French Francs or UK pounds or Deutschemarks etc. as appropriate. The alternative? Imagine search results with a list of prices in each of the 19 or so currencies boo supported next to each product. Horrific.

    And if you have different warehouses for Europe and North America, then advertise two separate sites, stupid!

    So who gets www.boo.com? Should there be a www.boo.com for Europe and a www.us.boo.com or www.boo.com/us for the US? That alienates a whole continent. And if everyone uses www.<countrycode>.boo.com, then what gets shown at www.boo.com?

    Forcing people to select a country at entry sucks. But having one universally recognised URL ending in .com for a global company is at the root of that particular problem. If, for example, people in the UK immediately went to <company>.co.uk instead of <company>.com then all would be well -- but they don't. Most people go to www.boo.com and expect to be served there.

    If only we all.. had... per...sonal cli....ent cert.....ific...........ates..............

    tam (~boo)

  • Somebody place a call to Lesley H Wexner. You know, the guy who owns Galyans, Abercrombe & Fitch, Lerners, The Limited, and Victoria's Secret. Les is just about due to buy another venture.
  • If anything, the collapse of boo.com and the study should help the marketplace realize that it doesn't matter how good your idea is, execution is where the long-term money comes from.

    Maybe we'll start to see a backlash in the IPO prices of dotcoms, now that it's been demonstrated that poorly planned, poorly run cyberspace retailers fail just like poorly planned, poorly run meatspace retailers.
  • BBC News is now reporting [bbc.co.uk] that over thirty companies are interested in buying boo.com. Liquidators are asking for a refundable deposit of one-million pounds from interested parties, by the end of today.

    --

    --

  • Well you're completely wrong. 10% unemployment rate doesn't mean that it'd be higher with a capitalist system.
  • they'll make more money selling their hardware through auctions than on all the clothes in their inventory.
  • I don't know if anyone has actually tried to shop at boo.com's site, but once you start using it, it gives you some pretty good ideas as to why it failed.

    1) Speed (Or lack thereof) - I tried it a few days ago. This is a site that wants bandwidth and plenty of it. When you get to the first page, your connection is assessed as to whether you want the funky version (read:slow) or the simpler version (read:nearly as slow). There's just too much going on. I connected on a 56k modem (like most home shoppers), but the assessment told me that I was going to have to use the simple version. Basically, if you wanted good speed, you were probably going to have use at least a 2 channel ISDN connection to get it. I've done connections using the fixed line at work, and it's still pretty lousy.

    That immediately alienates the majority of home users straight away, who aren't prepared to grow old during the download. Most people are still using 56k modems.

    2) From what I can gather, they employed at least 300 people and this was going to be the biggest money burner of all. If they had been more conscious of their money/resource allocation from the start, they probably could have lasted longer, which in turn would have given them considerably more time to start getting the money in.

    3) The relative success of some sites is in their discounting. You are enticed to a site because of it's cut price goods. That's supposed to be the benefit of going to a site - the reduction in overheads are passed on to you. Boo seemed to sell at full retail price for everything. Yet again, another incentive not to shop there. I can go down the high street and get things for the same price, sometimes cheaper. What's my incentive to go there ?

    4) Finally, their advertising was lousy. I only went there because I heard it was going down the pan. Ultimately, considering the marketing/advertising budget they had, I really don't understand who they were targeting. I don't have my head buried in the sand all day and I never saw a single advert. My colleagues say the same. I think they must have pitched the marketing very badly.

    Ultimately, those commerce sites that have good business plans along with sound marketing will survive. In all fairness, I've heard statistics that 1 in 3 UK businesses fail in their first year, so perhaps this isn't such a big surprise. What's the big deal if 1 in 3 .com's fail at about the same rate ?

    M.

  • I'm a European, and as most of the online Europeans, I live in a city. And as most european cities, my city has a beautiful downtown area where I can easily go (walking, in a bus or a metro, or in my car) and where I can find a LOT of shops. So, why the hell would I buy some clothes online. It can only bring me problems:
    • It's probably more expensive (shipping, etc.)
    • The payment is potentially insecure
    • I can't see the clothes correctly on the web site, and I can't try them
    • I don't know if and how I can send back the clothes
    • I have to wait before to get them
    And the same goes for a lot of things. For example, I can't have a look at good look at a book online, and it's rather difficult just to discover other books. All, that, combined with the fact that my phone provider is way too expensive, and you will understand why Boo.com will not work before a long time. BTW, has Amazon.com ever made any profit?
  • No, why would it? Just because an online store goes out of business, why would that signify the collapse of all e-commerce? Everytime a furniture store has "going out of business" commercials on TV, does that signify the collapse of normal retail stores? Of course not.

    E-commerce (dammit, I hate that word, as well as anything starting with e- or i- besides e-mail) definately has some kinks to work out before it works as well as physical stores, but there's no reason at all why it shouldn't. It's just like a normal store, only the cost of running it is a bit cheaper. No different than mail-order stores, really.
    --
  • There will be ups and downs, but the overall internet-retail market will have years of growth ahead of it. It will begin to mature, and that means some of the frontier nature will be gone, but it will certainly continue to be profitable and a growth industry.

    I keep trying to explain to people that our economy right now is in "frontier" mode. For examples of what to expect, look to the international expansion of the US economy post-war (both world wars, really); the beginning of the industrial age; the western expansion of the US, etc.
  • > IIRC, the original boo.com site was overblown with too many images, JavaScript, probably Flash and lots of other junk.

    In general, increased commercialization of the Web seems to be resulting in decreased utility.

    Sites that I visit irregularly (dejanews, cinemark, etc.) seem to be less usable each time I visit, and the phenomenon seems to be directly linked to commercialization: the pot of gold (search link, local schedule, whatever) is crowded in among the ads, links to other sites they want you to visit, and the general clutter that comes from attempting to be a universal portal. Further, deep links directly to the pot of gold are increasingly impossible, since they don't want you to miss all the ads and stuff.

    Finally, lots of the old fun sites (Anagram Insanity, etc.) are often shopped around, degraded, or dropped altogether, because suddenly the Web isn't a place to share and have fun anymore. Too many people seem to think there is something basically immoral about passing up an opportunity to make a buck.

    ps - Oh, the irony. While composing the above, I visited www.phonetic.com to see what its current status is. As I recently mentioned, I always surf with image downloading turned off. So what do I see as text replacement for the image at the top of their page?
    Please Turn On Options-Auto-Load Images/Display Images


    Gosh. D'yer think I should click it just to see what all-important image I'm missing out on?

    --
  • by JamesSharman ( 91225 ) on Thursday May 18, 2000 @02:40AM (#1064202)
    No, I don't think this is the start of the economic bubble bursting. This is a sign of an even more disconcerting issue for us Europeans. For the last couple of years our governments have been telling us the big Internet boom that has swept the states is going to happen over here (just a little later). This unfortunately is not entirely true, one of the great things the internet has done is sweep aside international barriers, you don't need one large book/sport ware/whatever vendor in each region for the internet, you just need one globally. The Internet bomb has not just been delayed in Europe it is not going to happen (to the same degree anyway). The US dominates the internet and change will be slow, factors like the metering of internet calls in most of Europe have slowed the take up speed and pushed us out of the critical window where we could take part in the 'boom' (UnMetered tariffs are appearing now but it is to little to late).
  • When you read anything about starting a business, there's always some statistic about how 75% or 90% (depending how they measure, etc.) of new businesses fail within the first few years. Is e-commerce actually worse off than the average? Even if it's no worse than normal, it's going to seem worse, because they all started about the same time so there's going to be a wave of failures as they reach the "do or die" point

    ========
  • dammit, I hate that word, as well as anything starting with e- or i- besides e-mail)

    Hear, hear!
    I'm getting so sick of everyone jumping on this e- and i- bandwagon. Is everybody just so uncreative that they can't think of a better name for their products or company? If I see a new company/product beginning with the i- or e- I pretty much ignore it, figuring it's mostly hype. (Been right for the most part, as far as my tastes go) YMMV.

  • But some of boo's highly-qualified workers are likely to find work soon. Recruitment agents were seen handing out cards to staff leaving the building.

    I hope that the managers and sales staff have as much luck.
  • by BlueUnderwear ( 73957 ) on Thursday May 18, 2000 @03:03AM (#1064209)
    Does anybody else have the impression that there was a slight contradiction in their target audience? What's next: A brick-and-mortar shop that tries to sell wearable computers to jocks?
  • It might be instructive to consider the railroads in the late 19th century. Almost all of the pioneering railroad companies went broke, but the railroads prospered and changed the face of the world forever.
  • -- it asked what country you were in. This
    -- was idiotic, given that the largest pool of
    -- visitors were in the US.


    This isn't true; boo was highly advertised in Europe so had a far higher European visitor ratio than most .coms have.

    Largest pool, I said. U.S. population: 300 million, with a higher level of internet penetration than any large European country. Surely Germany doesn't have as many internet users as the U.S. And Finland may be wired to the gills, but it's got fewer people than the Chicago metro area.

    Show prices in Euros and dollars if you really must put Europatriotism over sales. Hell, once you're using so much Flash anyway, have a discreet map of the (NATO-vicinity) world in the corner of the page that zooms on rollover.. do something. Or do as others do. Have a discreet pointer for switching countries. Defaulting to the US may be offensive, but until there's a bigger single market for a B2C e-commerce site, it makes business sense. And I'm well aware that day is at hand, between the rollout of the Euro and Japan's mad rush to net adoption.

    Anyway, Amazon doesn't seem to be having a problem with www.amazon.co.uk and www.amazon.de branding. Surely that's better than doing a lousy job of selling to everyone.
  • Government interference? The government gave huge subsidies to the railroads in the form of land grants. The free market worked so well that the Interstate Commerce Commission was formed to regulate rates.
  • Just some prediction

    Just some nay-saying.

    Now fontier mode does sound very impressive, but what people need most cannot be brought to them via the Internet.

    Many of my co-workers buy their food over the Internet. Looking for a home without the use of the Internet is starting to become "old school". And as far as companionship, I can't count the number of couples that I know who met on-line.

    What sorts of goods did you have in mind? Cars? Businesses? Office supplies? Sex toys? Contract services? Intellectual property research materials? Financial services?

    Let's not start revising history before it's made. The Internet (and commerce thereon) is revolutionizing the way we do things. WILL we all fall back into the same human patterns as before, but with the Internet as a piece of our lives? Of course; that's what humans do. But it's also what humans did as a result of the industrial revolution.
  • I think that the e-commerce suppy outgrew the demand. It's still a developing market, and everyone jumped on the bandwagon a little too early. Poeple are still slowly coming around to shopping online, but there are so many online stores that it was just a matter of time before some of them started falling away.
  • What justifies these extreme costs? Somebody somewhere is making a killing on this, and at the same time killing the internet in Europe it would seem. I am not sure of the value of the pound, but it seems like I probably pay less in rent for my 2 bdrm apartment than you do for your 64kb connection.

    I was considering moving to England or Scotland at some point in the next few years (always wanted to spend some time there) but perhaps not, if the future of the internet is looking bleak...

  • The current Boo might be stupid, but I would do better! Let me take it over! I will open source their website and sportswear, get lots of money from investors, and inflate their stock even though we won't turn a profit!

    I'll release the spandex shorts under the GPL so other people can make their own spandex shorts. But mine will have the "OFFICIAL" Boo.com logo on them, and we'll operate a call center for when people have trouble putting them on. But they'll only get support for 30 days after buying them, if they need help with daily use of their spandex shorts, they'll have to pay us a $125 per incident fee.

    I'll be rich, I tell you, rich.
  • Web browsers have this neat feature -- if they don't understand something in your code, they don't puke; they ignore it. If you use this to your advantage, you have the best of both worlds -- fancy stuff for the JS/Flash/etc.-enabled, and the non-enabled don't know what they're missing. :)

    That, combined with the above poster's design sensibilities, are the golden rules, IMO.

    phil

  • IIRC, the original boo.com site was overblown with too many images, JavaScript, probably Flash and lots of other junk.

    It definitly had Flash. It had a little virtual you that would put on the clothes and let you pan around. It had a little virtual Ms. Boo that would comment (allways positave empty comments). And it was dog slow. And not from anything on our end.

    Oh, and the virtual you? You can't tell what the damm clothes look like on it anyway. Your better off looking at the models (so you can see how the fabric really drapes).

    Even if boo.com failed for other reasons, I like to think of the total lack of usability testing as a contributing factor. Or total lack to listen to the testing.

    If the "bubble being over" means really bad sites like this dry up, I'm all for it.

  • Everytime a furniture store has "going out of business" commercials on TV, does that signify the collapse of normal retail stores?

    True, but furniture stores and traditional retail stores are old, established business models. No one goes into panic mode when one closes down.

    Online retailers, however, are new, untested business models. Major on-line vendors are watched closer than any other businesses, and when one fails, there are plenty of Internet pundits waiting in the wings with their "See, I told you, the E-commerce bubble is bursting" articles (read, ZD-Net).

    Obviously one failing business isn't going to drag the whole economy down with it, but it does get people talking, and eventually has an effect. Personally, I think the e-commerce and internet stock market are due for a "correction": the whole E-Commerce field has been growing too far, too fast. Many businesses will fall by the wayside no doubt, but when it's all said and done, you'll have a collection of businesses that have weathered the storm, and will be financially stronger because of it. And that's when e-commerce will start to become trusted by Average Joe, and really start to take off.
  • Point well made. However, in no way does that these toys should never be used. The key is to use them effectively and conservatively. Not conservatively in the political sense but, try to remember that just because it gets your geek rocks off doesn't mean squat to the librarian down the street who just wants to buy a couple of ounces of herbal tea via this newfangled internet gizmo.

    Personally, I use rollovers and other Javascript toys a lot. However, I aim to make them a minor part of the page and use them only where they genuinely enhance the user experience, and with small footprint images. No full screen rollovers will ever be found on one of my pages, ever, period, end of sentence.

    If you don't really have anything to say you only prove that fact by maxing out the special effects. (Does anybody know if George Lucas reads /.?)

  • How can *ANY* internet sales company survive in the UK? The VAT tax is going to eat any and all profit margin they have and then some. Why buy from some country that is going to slap on 20%+ onto the price when you can just go to another, more tax friendly, country?

    Unfortunatly, the British are so used to the VAT that they cannot see just how much it is holding them back.
  • by hatless ( 8275 ) on Thursday May 18, 2000 @04:40AM (#1064243)
    Boo collapsed because it was an ill-conceived mess. Sure, it had lovely design. Sue, it had all sorts of interface bells and whistles. But it was a godawful e-commerce site.

    Its home page didn't show any product or say what it was. It popped up a window that also didn't show any product or say what it was. Instead, it asked what country you were in. This was idiotic, given that the largest pool of visitors were in the US, and doubly idiotic because the US was at the bottom of an alphabetized list of countries. Very egalitarian and politically astute, sure, but idiotic if your goal is to sell, especially given that on average you lose half of all visitors with each click. Why ask the country up front? Why not wait until late in the transaction? And if you have different warehouses for Europe and North America, then advertise two separate sites, stupid!

    Once you drilled down to a product through its lovely but tedious Flash menus, you had to return to the store entrance to pick another brand or type of product. In other words, to pick a shirt and then get a pair of jeans, you'd have to click "continue shopping", which would take you to the front of the store again, because menus don't follow you through the drilldown.

    And the Flash. Flash is nice. Flash is close enough to universal these days to be justifiable on a commerce site. But Boo's use of complex framesets, multiple windows and multiple Flash elements per screen makes computers with less than 128MB RAM cry.

    Multiple windows. Eek! A Boo shopping session is pretty crowded with all the windows it opens on a 1280x1024 display. Windows overlap on 1024x768. At least a third of all web users are running in 800x600 or 640x480. And those on bigger monitors probably have other windows open for other apps anyway. Ouch.

    Boo was theoretically right in some of its design decisions. The mix-and-match clothing previewer is a keeper, or will be someday, as are the ideas behind the fabric zoom and 360-degree views. But the way they did it, over the heads and over the hardware reality of potential customers, was pure idiocy. The only serious interface change they made over time was to get rid of the "clippy"-like virtual advisor (also in a separate window). Adn I sort of liked that element.
  • Someone tell Jakob Nielsen, I think he has another test case. Next time I write to one of these firms saying "I can't be bothered to use your web site, fix it" I shall ask them if they want to be the next boo.com.
    --
  • I've visited their site a couple of times. First of all it's incredibly, in-cre-di-bly slow. They didn't do *anything* to make the webserver/site go fast.

    Second, they use frames. And tables. And flash. And JavaScript. And img.src. And CSS. And lots of browser-specific stuff. Basically they designed it for IE5/NS4 and Pentium II or equivalent. Big mistake.

    Because when people can't reach your website, they won't register. When people don't register, they don't buy. And when people don't buy you have no income. Simple as that.

    The fact that boo.com is no more has nothing to do with any cracks in any e-commerce bubble. The fact is that boo.com was a bad site.

    The lesson to learn? Don't use the latest and greatest in browser technology. Don't force flash, Javascript or anything fancy. Don't open any fscking new window. Keep it simple and FAST and your visitors will thank you in the form of visits and purchases.
  • I've *never* seen such a good example of a badly designed web site. It goes against *any* common sense, let alone advanced user interface guidelines. I went there the first day of their opening, and I found it:

    • comletely unusable
    • took hours to load
    • full of stupid glitches
    • full of crappy flash animations
    • required tons of plugins
    • HAD A NON RESIZEABLE WINDOW (arrgg!!)
    • full of useless products anyway
    • *expensive* prices!
    • without any kind of added value

    Overall, most of the junk mail I get in my snailmailbox is more useful than this crap site ever was.

    The downside is that plenty of legitimate ideas won't get financed as a result of investor getting too cautious now. For fuck's sake, it was so fucking obvious that those people did'nt have the slightest clue what they were doing!

    GO TO HELL, BOO.COM, AND STAY THERE!!!

  • by Karmageddon ( 186836 ) on Thursday May 18, 2000 @03:27AM (#1064255)
    It is not as depressing as all that for Europe... or, at least, it's not more depressing than it was. It's not the US that is dominating the internet, or new technology. Freedom dominates the internet and freedom will keep dominating new technologies.

    The US offers the most freedom to its people -- yes, including the freedom to go broke and lay off and fire people, who then have the freedom to have no healthcare and not enough food. But with those social ills... ah, but not: with only the risk of those social ills comes the power of flexibility. It means that a free economy can quickly throw out the old and adopt the new.

    In the 80's, everybody talked about Japan and European unification. Now, everybody talks about China. Why did J and E "fail" to overthrow US economic dominance, and why will C? Because they still don't get it: economic freedom allows individuals to generate more technology and more wealth.

    But, there's nothing uniquely "US" about freedom -- other than historically, it's where we've seen the most experimentation with freedom. Look at the open and free software movement: lot's of non US participation, maybe even dominance. Why? Because it's an area that offers freedom without regard to where you come from.

  • by Matts ( 1628 ) on Thursday May 18, 2000 @03:28AM (#1064256) Homepage
    Is cost. Pure and simple.

    To run a large scale web site here costs a fortune. I run a tiny site behind a 64k leased line link, and it costs a fortune for the facilities I have, in comparison to my American business colleagues (*). I can't even begin to think what it must cost to have 2 redundant T1's (actually I can, and the cost is anywhere between frightening to unbearable).

    (*) I pay £3600 (+17.5% tax) a year for 64Kb. My manager pays something like $40 a month for 1.5Mb down and 512Kb upstream.
  • by Roblimo ( 357 ) on Thursday May 18, 2000 @03:17AM (#1064257) Homepage Journal
    My wife is the reason boo.com failed. She's got high-limit credit cards, she likes to buy clothes, she's amenable to mail-order and Internet buying, and she's online (professionally and recreationally) for up to 10 hours per day. If she wasn't boo.com's perfect potential customer, who was?

    But when I showed Debbie this Slashdot post, she said she'd never heard of boo.com and certainly hadn't ever bought anything from them.

    Upon reflection, she thought she *might* have checked out the site briefly when it first launched, but found it unusable (because of all the Java). and didn't think their clothing selection was very exciting or that their prices were anything special, so she forgot about it.

    Multiply Debbie by millions of other women online, and it should be obvious why the company failed.

    - Robin
  • by mlas ( 165698 ) on Thursday May 18, 2000 @03:17AM (#1064259) Homepage
    I work for a company that's designing e-commerce sites and we were in the middle of coming up with design concepts when boo.com launched with The Buzz... everyone knew about it from industry press, etc. They had a great PR department and were well-funded, which is what made them "high-profile", _not_ favorable reactions from an adoring public. The site was overly tech-y, complex, and probably crashed half the browsers that visited it. There is a Golden Rule of web design (or any design, for that matter): Above All, Do No Harm. In the design of e-commerce, this can be refined as Don't Ever Get In The Way Of People Who Want To Spend Their Money On Your Site.

    Boo.com eventually redesigned, but by the time Boo Mk.2 launched, I no longer heard The Buzz. My suspicion is that, flush with his/her buzz-generating success after launch, the PR person in charge at the beginning jumped ship for greener pastures, while the techs and a dwindling design staff, morale shaken by user criticism, scrambled to use ever-diminishing capital to make the site usuable on the second go-round. Just a guess.

    Is the fall of boo.com a harbinger of the collapse of e-commerce? No more than RedHat stock's return to non-stratospheric levels invalidates Linux as a viable platform. Although I do think it's a harbinger of the inevitable return to earth of many overfunded companies flush with bright-eyed twenty-one-year-olds who think that being on the cutting edge guarantees their success and liberates them from such mundanities as user testing and developing a weatherproof business plan. Their ilk are numerous and we'll all be better off (and a bit wiser) without them.
  • Sites that I visit irregularly (dejanews, cinemark, etc.) seem to be less usable each time I visit, and the phenomenon seems to be directly linked to commercialization: the pot of gold (search link, local schedule, whatever) is crowded in among the ads, links to other sites they want you to visit, and the general clutter that comes from attempting to be a universal portal. Further, deep links directly to the pot of gold are increasingly impossible, since they don't want you to miss all the ads and stuff.

    Indeed.

    But for dejanews, there is a simple answer. Just try typing:

    http://www.deja.com/=dnc/[]/ [deja.com]

    and you get through 90% of the crap. It is left as an exercise for the reader to discover other options you can tack onto that URL to customize your web experience even more. :-)

  • It's happening time and again: businesss-oriented people make stupid projections (sheer guesswork) just to bring in venture capital, the bankers then hold them to deadlines and targets, and before you know it, the venture goes to the wall and the ecommerce bubble is reported to be bursting.

    It's all bollocks. These are extremely early days on a new business frontier, and whereas it's easy to see that the entirety of existence will be online in the fullness of time, at the moment only a wishful thinking idiot would hold him/herself to ransom through a banker's noose, to mix various metaphors.

    The ecommerce bubble is not bursting, it's barely started to form into a recognizable shape. This is a ladder that will grow all the way to the stars, but we're currently on rung one or two. To say that it doesn't lead anywhere interesting at this stage is utterly ridiculous.
  • There are a lot of things I would buy online without seeing them first. Over the next seven days, UPS will be delivering tennis balls, cat food, and a laminating machine.

    However, buying something that's supposed to fit your body is not smart. There are variations in the manufacturing of each item that requires a fitting before you purchase them. Shoes are a classic example. I went shopping for sneakers with my wife two weeks ago. She tried on about four pairs, all of which were her size and looked like they would fit. However, only one was comfortable, and we would never have known that just by looking at them.

    The same applies to a lot of the other items for sale, such as pants, leotards, and bikinis. My god, what woman would buy a bikini without trying it on first!?!?!?

  • "That said, someone needs to stop running around yelling "The sky is falling, the sky is falling"."

    And what sucks is, that if enough people do this, the sky just might fall.

    Bad Mojo [rps.net]
  • Regarding the initial post, I don't believe that this is the begining of the E-End. In a market like this, there will be a host of early adopters who are trying to grow fast. Some will, some won't. The ones who don't will go out of business and/or be swallowed up by the ones who did. Capital and economies of scale almost require it. Take a look at computer manufacturing, Internet Service Providers, or any number of similar industries.

    As to JamesSharman's point about Europe having been passed by, personally I don't count anyone out of the race. With the rate of change driving complete turnovers in technology and indeed in market creation itself, there will be plenty of places to 'jump in' downstream. And the advantage of going second is that you can avoid the mistakes of the first fellow. He does get there first, but you can avoid stepping in anything that he did ;-)
    For an example, take a look at cell phone technology. If I remember correctly, North America had it first, but Europe adopted a later standard (GSM) which give better performance and is more readily scalable.
    Just my $0.02,

    Matt
  • Apparently this thing was running in England, and was the biggest on-line shop of its kind in the world. Well, as an Englishman, I have to say that the first time I have ever heard of it was this morning on the radio news, where they are trying to pursue the angle that becaue this one ill-conceived venture has failed, the whole Internet must be a flop. Its pretty unlikely that I would have bought anything off them, but then I don't have any interest in the products of hypsters LastMinute.com, but at least I know who they are.

    Boo sold sportswear, right? I hate the whole sportswear for casualwear thing. I run and play squash (in real sportswear), but I don't wear Nikes to go to the pub. Its is always taken to the extreme by fat people and teenagers who smoke cigarettes and have bad acne. Why do the obese always wear clothing that tries to suggest they are the most out of shape long-distance runner in the world or something?

  • by sql*kitten ( 1359 ) on Thursday May 18, 2000 @02:40AM (#1064289)
    PWC [pwcglobal.com] also said that 1 in 4 of British internet firms would run out of $ within 6 months. [yahoo.com]

    The economic rules are slightly different for dotcoms. Most of the cash they burn goes on advertising, the actual costs of doing business (altho' I haven't done any quant to confirm this) for boo.com would be much lower than, say, Nike Town. Once a dotcom gets funded, it could probably hang on for 6 months just by lying low.

    If boo.com had worked out that marketing and advertising aren't the same thing, they'd probably have been a lot more successful. Consider a demographic who are constantly online with high powered equipment and plenty of bandwidth, have disposable income, and like to wear designer sportswear: the "new media" community, of course. Instead of the "viral" effect boo might of hoped for, the people who could have been their biggest market spent most of their time laughing at the site's ludicrous over-design - and everyone else couldn't get into the site at all!

  • by chrome koran ( 177357 ) on Thursday May 18, 2000 @02:41AM (#1064291)
    boo is the finest, best-known example of how naive it is to think that just because a site is really hip, uses cool dynamic elements and flash animations, it will be able to move product...let this serve as a lesson to the rest of you clothing retailers/manufacturers who are so caught up in building award-winning websites that you haven't noticed none of them work

    just take a glance at the top 50 traffic sites or the top 20 in e-sales and see how many of these hip designs are on the list...

  • by 348 ( 124012 ) on Thursday May 18, 2000 @02:41AM (#1064296) Homepage
    This is a prime example of PHB's mis managing technology. For one they over-leveraged the value of the environment, as most startup dot coms do. Secondly they screwed up by making the site either unreliable or to tough to navigate.

    But, initially at least, a large proportion of its potential market was unable to access Boo's site because the website design was too advanced for most computers.

    I wonder what they meant by that? I went to the site before it got /.ed and it seemed fairly ordinary to me. Malmsten and Hedelin did a good job with the mechanics of the site from what I can tell, but it sure looks like their rent-an-exec management staff made some very poor choices such as betting the farm on the value of board member relationships as the vehicle for capital, rather than raising capital by not overselling the value of the site/product.

  • I have a cash-flow analysis I run on all Internet startups, and I'll soon be putting it on my Downside.com [downside.com]. Right now, here's a typical raw analysis:

    Ticker CAIS CIK=01078404
    Parsing EDGAR index page: http://www.sec.gov/cgi-bin/srch-edgar?0001078404
    Parsing EDGAR filing: http://www.sec.gov/Archives/edgar/data/1078404/000 0928385-00-001580.txt
    Analysis for CAIS INTERNET INC filed 20000515
    Start date: JAN-01-2000
    End date: MAR-31-2000
    Period: 90 days.
    Multiplier: 1000
    Liquid assets: 26952000
    Income: -83497000
    Days to live since report: 29
    Analysis for CAIS INTERNET INC:
    Based on data from SEC schedule EX-27 for the period JAN-01-2000 to MAR-31-2000, the predicted bankrupcy date is Apr 29, 2000 which is -18 days away

    Or, in other words, what are they using for money?

  • by garethwi ( 118563 ) on Thursday May 18, 2000 @02:42AM (#1064298) Homepage
    I think it's a bit over the top to say that because one web site goes under, then the e-commerce bubble is about to burst.

    That would be the same as saying that just because the shop around the corner is shutting, then retail is going to be abandoned, and we will all return to self sufficiency.

    Also, if you look at Boo, and what they did, it's not much of a surprise that they went under. First of all they only targetted themselves at IE4 and NS4 or higher users, and for a long time the Mac was passed over completely.

    Also, most people complained about the non-intuitive nature of the interface, and the aparrent difficulty in actually getting to the checkout (not to mention the speed, and MS office paper-clip inspired shop assistants).

    So really, it's not that much of a surprise. As one news report put it, it shows that you should never put style over substance.
  • This deserves a bit more comment.

    In the startup phase, there are companies that need repeated rounds of financing to cover their expansion-phase losses. They assume that 1) someday there will be profits, and 2) they will be able to obtain repeated additional financing until then. Those are dangerous assumptions from a stockholder perspective. Even if the company gets financing, it either dilutes stockholder equity or adds a debt load.

    I'm not singling out CAIS Internet; there are all too many companies in this boat. CAIS's numbers look particularly bad because they had a forced payout to preferred stockholders in the first quarter. Nevertheless, their latest 10-Q filing [sec.gov] is a painful read.

    The analysis I'm doing simply assumes that losses will continue at the current rate, and big trouble will come when the cash runs out. This is a classic cash-flow analysis. One can make more optimistic assumptions, but when you see a company out of cash in the near future (or the recent past!) it's an indicator of, well, problems.

  • According to the FT.com piece: "Boo.com co-founder Ernst Malmsten told The Financial Times that he wished the company had kept stronger control of costs. "We have been too visionary," Malmsten said." Obviously the rest of us are just too hung up on that whole usability/profitability thang.
  • I was assured by one of my professors that 4 out of every 5 e-commerce sites will not be here a year from now. He went into myriad reasons, but chief among these was poor logistics planning (e.g. how many e-commerce sites stupidly set up their own distribution networks rather than contracting the work out to experienced firms?)

    My bet: The big-yet-poorly-managed companies, like Amazon, survive, but barely. The smaller ones, like cdnow and pets.com, either dry up or get bought by "old-world" brick-and-mortar companies. The tiny companies... well, let's just say those stock options you've been working for in lieu of a real paycheck will keep you warm for a little while if you use them as kindling.

    There will still be plenty of healthy Internet companies, though, once people figure out exactly how to create a profitable e-commerce company. (Has it been done yet?)

    - A.P.
    --


    "One World, one Web, one Program" - Microsoft promotional ad

  • OK, I'd never buy clothes online ( I mean, really??!) but I love music. From what I've seen, CDNOW is the best online music store out there: lots of information about most of their artists, biographies or histories of the band, etc.
    You wanna see crap music sites? go to HMV [hmv.com] orSam The Record Man [samscd.com] (hey what can I say, i gotta give props to Canadian content :)
    HMV requires JavaScript for any of their links to work (goodbye fast loading times) Not a lot of info on some artists, though anything new has some info on it. Sam's search leaves a lot to be desired, and they don't have covers or track listings for a lot of their back catalogue.

    I find CDNOW to be immensely valuable for research, even if I haven't bought anything from them yet.


    Pope

    Freedom is Slavery! Ignorance is Strength! Monopolies offer Choice!
  • It's just like a normal store, only the cost of running it is a bit cheaper. No different than mail-order stores, really.

    And that's the key isn't it? How does one differentiate a traditional mail order business from these new-fangled e-commerce businesses? Functionally, they are the same. E-commerce has the advantage of not needing to print and mail paper catalogs (big cost savings) and can also eliminate clerks in the back office to process requests. As with everything, there are problems with implementing these advantages.

    A lot of mail order places still print catalogs. I think there are three reasons for this:

    1. Some electronic catalogs suck. The people commissioning them decided to pay the least expensive developer - and it shows.

    2. Paper is VISIBLE. Electrons aren't. When the computer shuts off, the catalog is still on the desk in full view. 3. Culture, which goes something like this: Well, Smarty Pants computer-person, we have been printing a catalog for 50 years....(get it?)

    There are also problems in the back office. While some places have really good front-end web sites, they still use varying degrees of paper processing. Reasons for this range from not understanding how to streamline business process to include paperless processing to not wanting to spend the money to being overly conservative about change in general.

    While there are sites that offer great deals on merchandise, I have found a lot of instances where the cost of something online, plus shipping, is nearly equal to the cost of buying it in a local store and paying sales tax.

    There are other sites that actually charge more than their local retail counterparts. Last year, for example, I was looking for blue jeans at the Levi's website. If I remember correctly, they were charging an average of $35 per pair plus shipping. The local mall sold them for $25, with no sales tax on clothes. Granted, I live in an area with a lower cost of living, so this might have been a good deal in a place like Manhattan. But more people live outside of Manhattan than in it. If an e-merchandising is to remain a viable choice, then these businesses must adjust to the geo-economic realities of their expanded client base.
  • you don't need one large book/sport ware/whatever vendor in each region for the internet, you just need one globally

    If, by that, you mean a company that is in one geographic location and nowhere else, then you are forgetting one thing: shipping.

    Not just shipping costs, which are currently pretty high between eg the States and the UK (generally more than any discount you'll be getting on the goods, in my experience), but the time it takes.

    If I order a book from amazon.co.uk (assuming I can find one that has a discount that covers the postage costs, of course...), then I generally get it the next day (dependent on stock levels, etc). How long would it take to get the same book delivered from the States? 3 days without paying through the nose for it to go by air?

    If I can get it for a comparable price, right now, form the bookshop down the street, why would I bother?

    Yes, the companies may be owned elsewhere, and may have their head offices elsewhere, but they are still going to need warehouses and distributors globally if they want to sell globally and remain competitive.

    Even American owned companies are going to create jobs in Europe (and vice versa), if they want to sell there.

    I agree with your point about metering of internet calls, and would add that the slooooooooow roll out of ADSL and similar broad-band access is also crippling the widespread adoption of the internet here in the UK. Until there is widespread availability of (relatively) cheap, high-speed net access, the UK isn't evengoing to be a minor "internet player", let alone one of the leading ones, as our Government would like us to be. (I'll ignore for now some of the proposed laws that will have just as adverse an effect...)

    Cheers,

    Tim
  • That's already happened. If you're talking about loosing the hype surrounding e-Commerce, just check the stock histories of eBay, eToys, Amazon [noamazon.com] and most other so called e-tailers. Guess what, they're all way down compared to where they were. I think they e-tailing hype has already worn off, at least in the eyes of investors.

    kwsNI
  • <i>There will still be plenty of healthy Internet companies, though, once people figure out exactly how to create a
    profitable e-commerce company. (Has it been done yet?)</i>
    <p>
    Yes. Amazon.com's book sales have been profitable for nearly a year now. It's only by pushing into new market segments that they keep from making a profit overall. It's often said that Amazon could turn a profit tomorrow if they focussed on book sales alone.
  • The real reason Boo.com failed is this:

    Right now, Boo.com is the worst user experience on the planet.

    Flash-based, it forces far too many long downloads, slow page redraws and a pathetic user experience that provides layers upon layers of interactivity to even reach a product. On a dial-up connection it is completely unusuable; on a fat pipe, it's barely so. The addition of unbelievable amounts of javascript and frames mean that even the fastest computer will see speed hits on other simultaneous functions.

    Finally, the products are completely lack-luster. I can buy similar (or the same) items at faster sites any day of the week, usually for less money.

    In web-design circles and advertising agencies here in New York City, Boo.com is a running gag, the place you say people worked when they're horrible at their job.

    Boo.com deserves to fail.

  • by Ed Avis ( 5917 ) <ed@membled.com> on Thursday May 18, 2000 @02:43AM (#1064326) Homepage
    IIRC, the original boo.com site was overblown with too many images, JavaScript, probably Flash and lots of other junk. Nobody could use the site and within a few weeks they had to redo it as something simpler.

    Now the company has gone bankrupt. Could this be related to customers being driven away by their early, over-flashy Website?

    The tale of boo.com might be a useful weapon when trying to persuade your customers that JavaScript rollovers, MIDI files and Flash are not the last word in sophisticated Web design.
  • by LondonFish ( 134164 ) on Thursday May 18, 2000 @02:44AM (#1064328)

    Unbelievably, Boo managed to piss £80m up the wall. Despite having this massive arsenal, they seroiusly f**ked up the technology side, with a site most people couldn't use, and it sucked for those that did.

    It just goes to show the poor light that a lot of ecommerce entreprenures see technology in. They are quite happy to waste tens of millions on stupid marketing campaigns, but cannot be bothered to invest time and money to make sure their web sites work!

    Whats the betting that their technology people told them that their 'high tech' web site ideas wouldn't work in practice, and where roundly ingnored by the management who wouldn't know one end of a computer from the another.

    Still, this is the END of the bubble for companies like this. No one is getting that kind of money unless they seriously know what they are doing, including the technology aspect

  • by morn ( 136835 ) on Thursday May 18, 2000 @02:44AM (#1064330) Homepage
    Nevertheless, it begs the asking of this year's favourite question - is this the beginning of the ecommerce bubble bursting?

    I'd just like to point out that, though I did indeed pose that question, I didn't mean it as "Is this the end for ecommerce" or anything so dramatic - I meant "Are people finaly realising that a company has to make a profit to succeed?"

    --

    --

  • Moderate Dr.Sp0ng's comment up. Whoever submitted the story to Slashdot was being a little over-dramatic. Since when does one site going under lead to the conclusion that e-commerce (I hate the word too) is failing? We have (retail) stores here that go out of business all the time. Usually, they're small businesses but every now and then we have a larger firm go out. Nobody thinks that it's the end of retail when a statewide hardware store chain suddenly closed down. E-commerce is just starting and while it's often shaky, it's going to be here for a long time.

    That said, someone needs to stop running around yelling "The sky is falling, the sky is falling".

    kwsNI

  • The Register [theregister.co.uk], that bastion of technology journalism, has good article [theregister.co.uk] on why Boo failed.

    <summary>
    It was all Boo's fault for experimenting after they started their high-profile ad campaigns, not before.
    </summary>
  • by kevlar ( 13509 ) on Thursday May 18, 2000 @05:14AM (#1064338)
    With a 4% unemployment rate, I'd say the US does a damn fine job feeding its people. I should say the people do a damn fine job feeding themselves. This is in contrast to the unemployment rate of a country like France or Germany which is around 10% [jil.go.jp].

    I agree with you though, its the economic structure of the US that allows it to be dominant. Socialism in Europe is the only reason why they can't become a competitive entity.

    "Socialism promised to bring both increased wealth and greater equality, but in the end it stymied the growth of wealth almost everywhere it was tried and, from all appearances, was not altogether successful in bringing about greater equality either. When it ostensibly succeeded in leveling standards of living throughout a society -- as one socialist once commented with enthusiasm -- it came with 'all people being equally shabby.'" -Alan Greenspan
  • The USA has a few big advantages over the EU,
    Both have about the same number of people, (EU a bit higher). But while the EU has 15 nations with 15 legal codes, and 14 currencies (For now) and however many languages (12?) the USA has 1 legal system (Yes each state is different but much closer, but with one exception they are all based on English Comon Law) 1 Language, 1 Currency etc.

    Its a lot harder to be a pan European company, I worked for a company that had to deal will the entire EU (And more) and it was in many ways a major pain in the but.

    The Cure of the ills of Democracy is more Democracy.

  • Someone discovered that it's not really a web site. It's a giant chicken! A giant chicken I tell you!!!!

    (karma begone :-)
  • Civil unrest, environmental catastrophe, and ethnic cleansing? You may like it, but I'm heading to my cabin in Montana!

    Of course. Civil unrest is ongoing everywhere in the world with hot-spots popping up at the rate of at least one per day.

    Catastrophe... how about the fires in the southwest? Of course, someone will pull a major boner in the world of e-commerce, and some group of elderly won't get their medicine. It will happen. Legislation will be proposed. Nothing will happen. Happens in every industry.

    Ethnic clensing? Well, if you think of the traditional hacker (MIT definition) as the native Internet inhabitant....

    Yes, frontier economies lead to frontier lifestyles. The bad bank-robbers and pirates and stage-holdups will happen. The 50s were a time of tremendous prosperity, but also of massive coruption and misuse. This is human nature, and hiding away from civilization is not really a very good solution.

  • Have fun.

    I have nothing else to say about just another hype market failure.
  • "Is this the beginning of the e-Commerce collapse?"

    Judging by the stock market, that happened about a month ago. It's not that investors don't think e-commerce is going to be all that and a bag of chips, it's just that it's not clear whether or not consumers will be the only real beneficiary.

    -cwk.

  • So in other words, It the "advanced" term really meand poorly designed. Right

  • St00p3d m3.

    In NNTP we have this great option to withdraw.
  • by sstrick ( 137546 ) on Thursday May 18, 2000 @02:52AM (#1064359)
    The reason this has such lasting ramifications is because very few of these sites make a profit. As a result they rely on venture capital to keep going. A major player such as boo (their brand recognition in Europe was excellent) collasping is bound to scare of investors.

    This could hurt alot of startups. Somehow boo went through $135m in one year. For more details check out ft.com they have a very good article [ft.com] on it.
  • Maybe this is a sign of a more general trend. But the web design on boo.com was so awful that they probably weren't even in the running to begin with. They violated most rules of good web design: they had high bandwidth requirements, popped up a fixed size window, and left useless windows stranded.
  • But, initially at least, a large proportion of its potential market was unable to access Boo's site because the website design was too advanced for most computers.
    I wonder what they meant by that? Well, it used to be Windows only, for starters.
    I checked it out when they were new and saw failure coming fast
    Who buys clothes by mailorder? Not their target group anyway.

    If you want to sell something online it has to be either more convenient, cheaper or well stocked than the meat space alternative.
    Boo was not cheaper, did not offer more choise and was not more convenient than your usual store. "Cool" webdesign might attract visitors, but they will not *buy* anything.

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