Paying Tribute to E-Commerce Martyrs

No matter what industry you’re involved in, here’s something you don’t want to hear: well-respected analysts saying that your industry will survive long-term, but that you won’t be around to enjoy it.

Now, if you’re merely a bystander, if you’ve got a bet going with a friend that Web-based delivery services — that is, companies that deliver whatever perishable or frivolous item you order over the Internet — are here to stay, this is great news.

But if you’re in the Web delivery particular business, this is not a cheery forecast.

Nonetheless, the fact is that the first wave of companies in a field often fail to survive. Only after these pioneers give up their lives to set up habitable outposts do other companies come in and thrive.

So we should really take a moment to thank the online grocers, bike-riding candy-bar deliverers and van-driving replenishment types for their efforts.

One thing though — we’d better do it quick.

Location, Location

The new model for these companies seems to be to stake out a piece of friendly territory and do their thing right there. For Kozmo, which bagged San Francisco, California last year, it appears to be New York. For Webvan, probably Atlanta, Georgia.

And that’s fine. Hey, if you could make money at it, it’d be fine to target just a single city block or one apartment complex.

But these companies weren’t built for that kind of targeted effort, nor were they built to operate on that small of a scale. These were companies built with grand, sweeping schemes in mind. Companies built on the idea that fundamental changes were about to take place — and fast.

It hasn’t worked out. Now, all the old IPOs, acquisitions and streams of venture capital have only served to dig the eventual grave of the Webvans and Kozmos of the world. Investors are not interested in companies operating as small, niche delivery services. The expectations were that these companies would dominate markets and do it with style.

Legends of the Fall

It probably comes as pale comfort to the investors in these companies, or their employees, to know that the long-range forecast for their sector is a good one. And it probably comes as even less comfort to know these companies, and even the ones that have already come and gone, are largely responsible for that outlook, even though they themselves may not be around to benefit from it.

Maybe history will consider them true pioneers, in the sense that they staked a claim to land that no one was quite ready to settle down on just yet. Maybe in 20 years, when none of us steps foot inside a supermarket, we’ll try to recall the names of companies like Webvan and wonder whatever happened to them.

It’s not over for the Web delivery firms yet, of course. But it could be soon, because these companies took too long to recognize that the need they were seeking to fill was far from universal.

Translation Troubles

Unfortunately, these companies wanted to bring their business model to the world all at once. They’re already paying for that decision. Some have already paid with their lives and more will follow.

But sometimes, that’s just the way it goes. Someone had to be the first to go out there into the wild. Without this doomed first wave, how would we have learned about this new world and how the consumer views it?

Thanks for the bravery, guys. You won’t be forgotten — not right away, anyway.

What do you think? Let’s talk about it.

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Note: The opinions expressed by our columnists are their own and do not necessarily reflect the views of the E-Commerce Times or its management.

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