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ECT News Community   »   E-Commerce Times Talkback   »   Re: When Did Dot-Com Become a Dirty Word?



Re: When Did Dot-Com Become a Dirty Word?
Posted by: ECT News 2001-03-15 07:09:25

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Online delivery service Kozmo.com quietly, yet significantly, dropped
the "dot-com" from its name recently, and announced
it would mail out almost a half-million printed
catalogs, complete with a good old-fashioned toll-free number to call for ordering.


Although simple and straightforward, it may be a
wise business decision on the part of Kozmo's
principals. In the eyes of many investors,
consumers and industry observers, "dot-com" is
yesterday's news.


Re: When Did Dot-Com Become a Dirty Word?
Posted by: Art Avery 2001-03-16 16:49:03 In reply to: ECT News
If ecommerce companies are losing money on fulfillment, then they have only their own ignorance to blame!

With the right facility design and systems, it is almost a certainty that most ecom companies (including grocery home delivery) can make a profit from their fulfillment operation.

In fact, I remember one company I did a redesign project for that said that the only area in the company that made money was the shipping operation, because the rest of the industry was so competitive that margins were very thin (as in the grocery industry).

Art Avery
Principal Consultant - Avery & Assoc.
www.elogistics101.com


Re: When Did Dot-Com Become a Dirty Word?
Posted by: George Alsfeld 2001-03-15 18:24:48 In reply to: ECT News
Excellent article by Paul Greenberg!

Many of us who have been involved in business for a while knew that the dot.com business model could not survive. With so many start up companies buying into the notion that growth-at-any-cost, regardless of profits and cash flow, is a viable business strategy, it's no wonder that we are seeing a rash of business failures. Likewise, the notion that any traditional brick-and-mortar business is inherently inferior to its born-on-the-web counterpart is as flawed as it is arrogant.

So why were so many of us so easily fooled? The short answer is based on three things, the first of which is demographics. There has been a lot of investment capital available because the "Baby-Boom" generation is in its peak savings and investing years. This coupled with the belief that most of us will need more than Social Security and company-sponsored plans for our retirement has fueled a tremendous amount of activity in the markets. Secondly, the Internet truly is a major technological advancement that will indeed change the way most business is conducted. Finally, yes, there is the greed factor. Many of us simply did not want to miss out.

However, one needs to keep a sense of perspective in all of this. E-business is not dead. Consumer spending on the Internet continues to grow unabated. The growth in the B2B sector is even more dramatic. On the consumer side, the Internet continues to provide convenience and information at unprecedented levels. On the business side, the Internet will allow supply chains to operate more swiftly and efficiently. In both the B2C and B2B sectors, the Internet will enable businesses to develop one-to-one relationships with customers, opening the door to value-added services and products.

So what happens next? Get ready for more change and sustained growth and gains. Who will the winners be? Those technology companies that provide the tools for companies to transform or even reinvent themselves. And, those businesses that learn how to use those tools and form productive partnerships so that they are not swept aside by the dramatic changes and improvements that are sure to come.


Re: When Did Dot-Com Become a Dirty Word?
Posted by: David Porter 2001-03-15 07:19:29 In reply to: ECT News
In my opinion, dot-com retailing has two main constraints:
(1) Since most consumers can't be sure that they'll be home when their goods are delivered; most aren't willing to buy many home-delivered goods in the first place; and
(2) Since *delivery rate x average order size = revenue*, delivery rates have been too low.
Nevertheless, it appears that both constraints can be overcome.

Several months ago, an analyst with the US Postal Service called to tell me that the average number of residential deliveries made per hour by letter carriers in the Kansas City region was 85.24. The reason I requested that data was to get a home-delivery benchmark. For example, drivers for online grocers Webvan and Peapod now probably make around 3 deliveries per hour; but if only it was 6, their sales would double and their delivery costs would be cut in half. And even though the home delivery rates for FedEx, UPS and even Kozmo are undoubtedly higher than online grocers, "nobody" would even come close to the rate of a mailman. Why? Because all homes have mailboxes; and as a result, mailmen can deliver even when no one is there. ...And bigger/more functional boxes -- like the one described at www.ideo.com/studies/brivo.htm -- should soon give exactly the same advantage to the entire consumer-direct economy!

For additional evidence, I cordially invite you to see a 1992 survey found at http://www.pond.com/~hhorning/dp/survey.html (paying particular attention to questions 6 & 7); as well as the info found at www.fastlaundry.com/evidence.htm Furthermore, a relevant bit of trivia can be found on the Smithsonian's National Postal Museum site at http://www.si.edu/postal/learnmore/knocker.html

Sincerely,
David Porter
Kansas City
ph: 816-221-1066

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