An example of an e-commerce failure & its causes

With the changing trends of globalization and the advancement of modern technology, the development of e-commerce has boomed in the past few years. This Internet based business has motivated many entrepreneurs to be a part of this monetary potential world. However, not all companies are succeeded in this business world handles by the advanced technology. Companies usually fail to achieve complete success and are not able to face the challenges in market via Internet.

The example of the e-commerce failure is Pets.com. It is a former dot-com enterprise that ceased operations in November of 2000. Pets.com was a short-lived online business that sold pet accessories and supplies direct to consumers over the World Wide Web.

The main reason of the Pets.com failure which is they would not be able to raise further capital. Therefore, they aggressively undertook actions to sell the company. This is because they were unable to give their customer a reason to buy their pets instead of the local pet store. Besides, they also face the challenge of shipping costs when they compete with real-world stores. In the end, Pets.com was forced to sell its pet food far below cost to remain competitive, which is hardly a sustainable business model. Pets.com failed to understand the consumer and thus failed to position the company in accordance with anything other than price.