Flooz.com
Flooz.com was a dot-com venture, now defunct, based in New York City that went online in February 1999, promoted by comic actress Whoopi Goldberg in a series of television advertisements.The name "flooz" was based upon the Arabic word for money, فلوس, fuloos.
For every good dot-com idea, there are a handful of really terrible ideas. Flooz.com was a perfect example of a “what the heck were they thinking?” business. Pushed by Jumping Jack Flash star and perennial Hollywood Squares center square Whoopi Goldberg, Flooz was meant to be online currency that would serve as an alternative to credit cards. After buying a certain amount of Flooz, you could then use it at a number of retail partners. While the concept is similar to a merchant’s gift card, at least gift cards are tangible items that are backed by the merchant and not a third party. It boggles the mind why anyone would rather use an “online currency” than an actual credit card, but that didn’t stop Flooz from raising a staggering $35 million from investors and signing up retail giants such as Tower Records, Barnes & Noble, and Restoration Hardware. Flooz went bankrupt in August 2001 along with its competitor Beenz.com.
Some Reasons are:
- lack of security protect
- fail to established customer trust
The lack of security protect over their system over the internet.
The officially ceased operations of Flooz.com is over the weekend. It fell victim to a softening economy and a sour investment atmosphere. Internet fraud may have sped its demise.
The company had unknowingly sold $300,000 of its currency, known as flooz, over the last three months to a ring of credit card thieves in Russia and the Philippines, before being alerted by the F.B.I.
Stolen credit card numbers were used online to buy the flooz currency, which, until recently, could be used as gift certificates at about 30 retail Web sites, including those of J. Crew, Barnes & Noble and Tower Records. Flooz.com's credit card processing company, which Flooz.com executives would not identify, also alerted the company about the fraud, after the Flooz.com charges showed up on the monthly statements of people whose credit cards, or card numbers, had been stolen.
Flooz.com, which provided a currency that a credit card thief could buy and use like cash online, in some ways gave thieves greater liquidity.
Flooz.com's problems reflect the difficulty of creating a successful online currency.
Moreover, Flooz.com's troubles also reflect the fragility of credit arrangements for e-commerce businesses that lack a deep well of cash.
Flooz.com is also fail to established customer trust that should implement and practice as many ideas or features to help establish trust with customers as possible. Use security banners and trust certificates, have an active SSL certificate in place, display contact information, create clear policies, use live chat and implement a quality customer service strategy.
Pets.com
Pets.com was a dot-com enterprise that sold pet supplies to retail customers. It began operations in August 1998 and closed in November 2000. A high-profile marketing campaign gave it a widely recognized public presence, including an appearance in the 1999 Macy's Thanksgiving Day Parade and an advertisement in the 2000 Super Bowl Its popular sock puppet advertising mascot was interviewed by People magazine and appeared on Good Morning America.
Although sales rose dramatically due to the attention, the company was weak on fundamentals and actually lost money on most of its sales.
By fall of 2000, after the bursting of the dot-com bubble, the Pets.com management and board realized that they would not be able to raise further capital. However when PetSmart offered less than the net cash value of the company, Pets.com's board turned down that offer. Pets.com stock had fallen from over $11 per share in February 2000 to $0.19 the day of its liquidation announcement. While the offer from PetSmart.com was declined, some assets, including its domain, were sold to PetSmart.com. The pets.com management stayed on to provide an orderly wind down of operations and liquidation of assets.
Obviously, the poor business plan of company led to Pets.com failure. First of all, Pets.com had overestimated the market trend. The company optimistically assumed that the revenues would grow rapidly and allow them to hit their rate. However, the estimation was based on the current market without analyzing the future trend and risk. This unsustainable business model facing downfalls when dot-com failure.
Furthermore, the company did not bring up a good proposal in opposing its competitors. Pets.com advertised extensively and selling its products at low prices to maintain competitive. High cost of delivering and low profit margins caused the company facing crisis in generating revenues. Nine months after securing $82.5 million in investment the company went bankrupt.
Pets.com never had a unique selling proposition. There is no reason to convince consumers to buy pet foods and accessories through the site. Since it is available within neighbourhood, purchasing online is inconvenient as customers have to wait for days to receive their orders. The cat may already poop all over the floor when the cat litter arrived. There is no benefit regards price nor convenient.
By fall of 2000, after the bursting of the dot-com bubble, the Pets.com management and board realized that they would not be able to raise further capital. However when PetSmart offered less than the net cash value of the company, Pets.com's board turned down that offer. Pets.com stock had fallen from over $11 per share in February 2000 to $0.19 the day of its liquidation announcement. While the offer from PetSmart.com was declined, some assets, including its domain, were sold to PetSmart.com. The pets.com management stayed on to provide an orderly wind down of operations and liquidation of assets.
Obviously, the poor business plan of company led to Pets.com failure. First of all, Pets.com had overestimated the market trend. The company optimistically assumed that the revenues would grow rapidly and allow them to hit their rate. However, the estimation was based on the current market without analyzing the future trend and risk. This unsustainable business model facing downfalls when dot-com failure.
Furthermore, the company did not bring up a good proposal in opposing its competitors. Pets.com advertised extensively and selling its products at low prices to maintain competitive. High cost of delivering and low profit margins caused the company facing crisis in generating revenues. Nine months after securing $82.5 million in investment the company went bankrupt.
Pets.com never had a unique selling proposition. There is no reason to convince consumers to buy pet foods and accessories through the site. Since it is available within neighbourhood, purchasing online is inconvenient as customers have to wait for days to receive their orders. The cat may already poop all over the floor when the cat litter arrived. There is no benefit regards price nor convenient.
Boo.com
Boo.com was a British Internet company, founded by Swedes Ernst Malmsten, Kajsa Leander and Patrik Hedelin, which went out of business following the dot-com boom of the late 1990s.
After several highly publicized delays, Boo.com launched in the autumn of 1999 selling branded fashion apparel over the Internet. The company spent $135 million of venture capital in just 18 months,and it was placed into receivership on 18 May 2000 andliquidated.
Although there were several months of delays prior to launch and problems with the user experience when boo.com first launched, these had been largely cured by the time the company entered receivership. Indeed sales had grown rapidly and were around $500,000 for the fortnight prior to the site being shut down.
The fundamental problem was that the company was following an extremely aggressive growth plan, launching simultaneously in multiple European countries. This plan was founded on the assumption of the ready availability of venture capital money to see the company through the first few years of trading until sales caught up with operating expenses. Such capital ceased to be available for all practical purposes in the second quarter of 2000 following dramatic falls in the NASDAQ presaging the "dot crash" following the Dot-com bubble. Boo was only the first of numerous similar Dot-com company failures over the subsequent two years.
The complicated design required the site to be displayed in a fixed-size window, which limited the space available to display product information to the customer. Navigation techniques changed as the customer moved around the site. This was done to appeal to those who were visiting to see the website, but frustrated those who simply wanted to buy clothes.The boo.com website was widely criticized as poorly designed for its target audience, going against many usability conventions. The site relied heavily on JavaScript and Flash technology to display pseudo-3D views of wares as well as Miss Boo, a sales-assistant-style avatar. The first publicly released version of the site included many large pages; the home page, for example, was several hundred kilobytes which meant that many users had to wait minutes for the site to load, as broadband technologies were not widely available at the time. The site's front page contained the warning, "this site is designed for 56K modems and above".
The site's interface was complex and included a hierarchical system that required the user to answer four or five different questions before sometimes revealing that there were no products in stock in a particular sub-section. The same basic questions then had to be answered again until results were found.
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