EToys.com is one of the websites which sell toys via e-commerce. EToys.com was founded by CEO Toby Lenk, COO Frank Han and Bill Gross in 1997. Etoys seemed like a very good idea for busy parents. It provides them a chance to order thousands of toys category from the comfort of their homes. The most popular sections of eToys.com – Babycenter and Parentcenter which provide articles and newsletters for new and expectant mothers had formed a loyal customer base.
However, eToys.com suffered a black eye after it failed to achieve one of its initial goals – speedy and reliable during the Christmas in 1999. Thousands of customers complained that their orders were either late in arriving at their destination or contained the wrong merchandise. This event had seriously destroyed the first image of eToys.com for new customers and made many worry of using the site again.
Unfortunately, Etoys.com was gone into another crunch when Toys “R” Us and Amazon.com formed a partnership in August 2000. Etoys.com faced a major competitor during the 2000 holiday shopping season.
In order to avoid the shipping missteps of 1999, the company spent heavily to build two large warehouses to handle inventory and delivery. Nevertheless, the total $ 120 million income of sales for the 2000 season was just half of the company’s expectation. Short of money and other funding options exhausted, eToys.com filed for bankruptcy finally in March 2001.
However, eToys.com suffered a black eye after it failed to achieve one of its initial goals – speedy and reliable during the Christmas in 1999. Thousands of customers complained that their orders were either late in arriving at their destination or contained the wrong merchandise. This event had seriously destroyed the first image of eToys.com for new customers and made many worry of using the site again.
Unfortunately, Etoys.com was gone into another crunch when Toys “R” Us and Amazon.com formed a partnership in August 2000. Etoys.com faced a major competitor during the 2000 holiday shopping season.
In order to avoid the shipping missteps of 1999, the company spent heavily to build two large warehouses to handle inventory and delivery. Nevertheless, the total $ 120 million income of sales for the 2000 season was just half of the company’s expectation. Short of money and other funding options exhausted, eToys.com filed for bankruptcy finally in March 2001.
4 comments:
What a sorry case of mismanagement and short-sightedness of the company. Hope it'll serve as a learning reference for other similar online companies hoping to make their gain thru online! Luckily my eBay is still there. Just love to shop there for its cheap stuff, rare stuff and its reliable and fast service.
Seems like the company failed to learn from its initial mistake and continue to make mistakes after mistakes until it failed completely!
Lazy Fish, thanks for highlighting this. We need to learn from this if we ever want to venture into e-commerce. We learn from the good and the bad. Agree?
Dear phua,
yaya, I agree with you. Know the good and keep it up, whereas know the bad and correct it.
According to Shaun Rein, though the overall retail sales in China in 2009 would fall because of the financial turbulence, ecommerce is still going to boom. he said "We're expecting a 20 percent growth in 2009, and we think it's actually going to be one of the strongest sectors in China this year because of the financial crisis". http://www.infyecommercesolution.com/
Post a Comment