By Pia Heikkila, 19 May 2000 00:25
NEWS Online clothing retailer boo.com has gone bust just six months after its official launch, despite boasting a list of investors that included Benetton, Bernard Arnault and Goldman Sachs. As the company called in KPMG to act as liquidators, industry experts said the collapse was primarily the result of the company's failure to identify its customers' needs. Martha Bennett, analyst from research consultancy Giga, told silicon.com: "An exciting business model and well-known investors are not enough to create a successful company. A major reason for boo.com's demise was the company ignoring its customers." According to Bennett, the complex Web site design was a major mistake. She said: "They launched in 18 different countries without any customer base and very little technical knowledge of users' ability to actually access the Web site." Lorenzo Wood, director from ebusiness agency Oyster, said: "Companies like boo.com are focusing too much on marketing and creating a brand name, but ignoring their customers. Entrepreneurs who are being responsive to their customers' needs are the ones who will succeed." Despite boo.com's demise, Bennett said the future is bright for online retailers. "Business-to-customer ecommerce is still possible as long as retailers understand it is all about helping customers," she added. Around 200 boo.com staff in the UK alone are expected to be made redundant.
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