Boo.com

Boo.com was an English Internet companies that wanted the late 1990s to establish itself as a global online shop for Fashion & Sportswear in the New Economy. In May 2000, the company went with bursting of the speculative bubble in the bankruptcy.

History

Boo.com was founded by Swedes Ernst Malmsten, Kajsa Leander and Patrik Hedelin in London in 1998. The business objective of the company was directed from the online sales of fashion and sports articles. The special feature is that the customers very attractive fashion labels at low prices - free shipping - should be able to acquire. The concept was well received. The company's founders collected within a short time a $ 120 million investor funds. The investors were well-known companies from trade and industry, such as Benetton, JP Morgan and Goldman Sachs The French luxury goods tycoon Bernard Arnault took part in the company.

The bankruptcy

The demise of the company in May 2000 came abruptly and was considered one of the most spectacular Internet failures of all time. In retrospect, it turned out that many of the serious home-made errors were responsible for the collapse. The problems began in 1999.

• There expensive advertisements were placed, which fizzled out without any effect, because the start of the online business for fashion is significantly delayed.
• Technical difficulties accompanying the multiple shifted start of the online portal. The operating functions were immature and hindered the creation of a " fancy " website. The result was a large, cumbersome and overloaded portal, which was hardly accessible for most customers because huge amounts of data volumes overwhelmed the at that time still slow modems to the Internet. The page -based play in a pseudo - 3D animation on JavaScript and Flash to the product range as well as mascot and sales tool avatar Miss Boo. The page contained the warning: " This site is designed for 56 K modems and above ". Also the interface was too complex, because you stepped construction demanded from the customer that he had to answer five or six questions before had to realize that his desire goods were not available.
• The free shipping tore huge financial holes in the budget of the company. Boo.com had to bear the costs themselves; aggravating factor was that the users are increasingly from their conversion rights made ​​use of what the cost blew up and moved tens of millions of dollars in charges for the company after it, because of the care providers for the exchange, the German post office put the cost boo.com charged.
• There were typical errors of the New Economy, which related to personnel management. Uncontrolled employee attitudes, the failure of the establishment of clear management structures, above-average salaries and escalating expense reports in the exploration of international markets flanked the decline. The investors refused to provide additional money to spend.

A sale of the company has not been possible because successful contract negotiations failed already cooled on the interest of investors to invest in business-to -consumer transactions.