‘Unless we raise $20 million by midnight, boo.com is dead.’ So said boo.com CEO Ernst Malmsten on 18 May 2000. Half the investment was raised, but this was too little, too late, and at midnight, less than a year after its launch, Boo.com closed. The headlines in the Financial Times the next day read: ‘Boo.com collapses as investors refuse funds. Online sports retailer becomes Europe’s first big Internet casualty.’

Boo.com remains a valuable case study for all types of businesses, since it doesn’t only illustrate the challenges of managing e-commerce for a clothes retailer, but rather highlights failings in e-commerce strategy and management that can be made in any type of organisation. 

Boo.com was founded in 1998 by three Swedish entrepreneurs, Ernst Malmsten, Kajsa Leander and Patrik Hedelin. Malmsten and Leander had previous business experience in publishing, where they created a specialist publisher and had also created an online bookstore, bokus.com, which in 1997 became the world’s third largest book e-retailer behind Amazon and Barnes& Noble. They became millionaires when they sold the company in 1998. At Boo.com, they were joined by Patrik Hedelin, who was also the financial director at bokus, and at the time they were perceived as experienced European Internet entrepreneurs by the investors who backed them in their new venture. 

The vision for Boo.com was for it to become the world’s first online global sports retail site. It would be a European brand, but with a global appeal. Think of it as a sports and fashion retail version of Amazon. At launch it would open its virtual doors in both Europe and America with a view to ‘amazoning the sector’. Note, though, that Amazon did not launch simultaneously in all markets. Rather it became established in the US before providing local European distribution.  

According to Malmsten et al. (2001), the boo brand name originated from film star Bo Derek, best known for her role in the movie 10. The domain name ‘bo.com’ was unavailable, but adding an ‘o’, they managed to procure the domain ‘boo.com’ for $2500 from a domain name dealer. According to Rob Talbot, director of marketing for Boo.com, Boo was ‘looking for a name that was easy to spell across all the different countries and easy to remember . . . something that didn’t have a particular meaning’. 

Questions 

1 Which strategic marketing assumptions and decisions arguably made Boo.com’s failure inevitable? Contrast these with other dot-com-era survivors that are still in business, for example lastminute.com, Egg.com and Fire box.com.

2 Use the framework of the marketing mix to appraise the marketing tactics of Boo.com in the areas of product, pricing, place, promotion, process, people and physical evidence.

3 In many ways, the vision of Boo’s founders were ‘ideas before their time’. Give examples of e-retail techniques used to create an engaging online customer experience which Boo adopted that are now becoming commonplace.