Presented by: Valen/n Gaja Jihan James Chad Lefort Keri Parquet Sidney Ricard Wesley Vizier Antonia Wright

Presented by: Valen/n Gaja Jihan James Chad Lefort Keri Parquet Sidney Ricard Wesley Vizier Antonia Wright

Overview of Presentation Review of Case Details Visual of Potential Site Analyze Issues Managerial, Organizational, Technical, and Design The Conclusion of Boo.com Questions/Discussion

Introduction Key Players o Malmsten & Leander o Addition of Hedelin o J.P. Morgan funded the project Organizational Structure o E-tailer Model o "Cash rich, time-poor" market segment retail sold at full price o Board Members: mostly management, 4 investors

Introduction cont. What was supposed to happen? o IPO (initial public offering of stock) o Global (offered in 18 countries) o Develop own software o Free shipping within 5 days o Initial launch Date: May 1999 What happened? o Launched November 1999 (6 months after initial launch date) o Sales were low and costs were high o J.P. Morgan resigned as financial advisor o Started selling products at a 40% discount o Eventually declared bankruptcy

Brief Look into Boo.com

Managerial Issues Resignation of J.P. Morgan's representative on board of directors Lack of oversight by the board of directors Management (investors) lacked basic retailing & internet skills Hired a massive amount of people

Organizational Issues Made ambitious plans without proper risk assessment o Develop a system to handle 100 million visitors as once o Globalize company from get-go- 18 countries o No clear idea of what the execution of their expectations entailed Poor marketing strategy o Too much advertising too early Lack of financial control o Heavy luxury spending o Expenses exceeded income Lack of sufficient initial planning o Launch date postponed several times o Idle employees as a result of multiple launch date postponing

Technical Issues Some good things came from Boo.com's technology: o Innovative o State of the art technology for its time o Laid down the foundational systems for top e-commerce retail sites Poor coding/optimization: o Only one in four attempts to make a purchase worked o Dead web pages o Site relied heavily on JavaScript and Flash o Apple Macintosh computers incompatible Developed complex software in-house o Site offered 7 different languages & converted 18 different currencies along with their relevant taxes o Complex virtual inventory system

Technical Issues cont. Site developed with too many complex graphics: o Customers computers froze due to this o Majority of homes in US and Europe lacked broadband Internet connections required to easily access graphics and animations o Telecommunication Reports reported in August of 1999: 58 million dial-up users 2.8 million cable users 286,000 DSL users o Average dial-up user in 1999 would have one of these modems: 28.8k (released 1994) 33.3k (released 1996) 56k (released 1998)

Design Issues Overall design created a frustrating and disastrous user experience: Went against many usability conventions o Page View o Full java and flash coding o Coloring Problems o Miss Boo Hierarchical menus too precise o Links at the top of the page Some things were hard to see o Descriptions were small o Tiny icons Unique scrolling method

How could this have been avoided? Better initial planning o Schedule o Financial o Development More achievable goals for a start up company Clear mission statement Better financial control Understand Customers needs and wants Beta testing of site before global launch Consultation from an outside source/specialist for programming

What happened to Boo.com? An estimated $135 million dollars lost! Fashionmall.com purchased Boo.com (brand name, web address, advertising materials and online content) o The new Boo.com directed customers to websites that sold the products they wanted to purchase o Amount paid unknown Bright Station PLC purchased the software for taking orders in multiple languages o $374,900 less than 1% of what Boo paid to develop it What is Boo.com now? o http://www.boo.com

Questions? Do you think that Boo.com's e-business concept was doomed from the beginning? Do you think the business model would have worked if the company were to be launched at a much later date? In your opinion, was this primarily a technical failure or a failure to understand the target market? Boo.com's 3 key players did not have any technical expertise in programming or hardware. Do you think this contributed to the downfall of the company? What lessons have you learned from this case study?