In this modern and digitized world, we witnessed the launch, rapid rise and sudden fall of a relatively new industry that is e-commerce. With the widespread use of the Internet, exciting business to consumer (B2C) e-tail opportunities emerged. However, have some of the business succeed and fail due to number of different factors. Such as pets.com, boo.com, streamline.com, garden.com, DrKoop.com and eToys.com as examples of the hundreds of dot com business that failed.
I am now going to write about an example of e-commerce failure and its causes. The example I am going to use is DrKoop.com.
DrKoop.com (Drkoop) was launced in July 1998 by Donald W. Hackett and John. Zaccaro. DrKoop is a healthcare IT firm in Bloomfield, Michigan and they were a leading global healthcare network providing measureable value to individuals worldwide. During 1998 their operating revenues just hit US$43,000 but that did not keep the company from going public in June 1999 with capitalization of US$1 billion. Subsequently, DrKoop business plan rested on advertising but there were not enough healthcare advertisers to support it.
DrKoop fail to achieve complete success and unable to face the challenges in market via Internet. The main factors that affect the business of DrKoop is bad marketing strategy, unpersuaded marketing strategy, and unable to understand the needs of customers which lead to bankrupt and failed to achieve success. In the end, DrKoop the medical information web site was sold to a Florida company for only US$186,000 which was once worth US$1billion.
WHY DID DrKoop.com FAIL?
· The management of the company has NOT realized the important to achieve the goals of the company. Unrealized goal of the health care industry.
· Trouble in cash for the trademark, website and others.
· Difficult to build trust and brand value with their name especially through via internet. Moreover, it is related to health which needs more approval and confidence by the government.
· The Company did NOT understand their customer, needs to identify demands, needs of customers as well as understand the market in health industry business.
In conclusion, the DrKoop.com needs to implementation of effective business strategies and a strategic management process for the betterment of the company desirable for achieving long lasting success of an e-commerce company.
Related link:
1. http://www.drkoop.com/
2. http://www.thestandard.com/
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