An example of an E-Commerce failure and its causes

Pets.com is an example of E-Commerce failure. Pets.com launched in August 1998 and it went into liquidation after 9 months its commerce its business.
The main cause of this dot-com failure is the inaccurately and inefficiency in managed its business. As in the case stated, Pets.com was never able to give the pet owners a compelling reason to buy supplier online. For example, when customers make an order of a kitty litter, Pets.com will delayed the order, customer had to wait for a few days only can get what they want actually. And try to think what if the use of kitty litter is emergent for them at that moment? One of the purposes of online business is the save the customer’s time and try their best to fulfill the customer’s needs. However, Pets.com did not concern on the customer satisfaction, that why it lost a lot of its customers.

Besides that, Pets.com keeps making losses on selling its products. It is because they want to attract more customers to join their online pet store, they make a wrong decision. They had undercharged its shipping costs to the customers in order to attract customers, it actually lost money on most of the products it sold, and they have to bear the loss themselves.

Moreover, people found that Pets.com is an immature online shopping world, it was risk taking investors and founder. Pets.com had throw many money in the investment of infrastructure, and the most significant investment was its warehouse. They have to make sure that the company must get to a certain revenue in order to support its infrastructure buildout. To get to the certain revenue, the company needing a critical mass of customers to break even and this make the Pets.com facing a critical time.

Because of these main causes mentioned above, Pets.com failed to continue its business.

(written by siew wan)