Webvan was an online grocery business that went bankrupt in 2001. It delivered products to customer's homes within a 30-minute window of their choosing. At its peak it offered service in ten diffirent cities in the U.S. Experts hailed that Webvan was one of the greatest dotcom disasters in history.
While Webvan was popular, the money spent on infrastructure far exceeded sales growth, and the company eventually ran out of money. As part of its shutdown process, all non perishable food was donated to local food banks. Webvan's legacy consist thousands of coloured platic shipping bins for groceries that are still siting in customer's basements and closets.
The online grocery market sector has seen many other failures, including Publix Direct. However there have been a few successes. Analysts blamed the failure of Webvan is caused by a serious error of judgment on the fact that none of Webvan's senior executives had any management experience in supermarket industry. Another factor that contributes the disaster is the Webvan policy of trying to embrace a total customer satisfaction model involving 30 minute window delivery without considering that many working customers would like their groceries delivered at home at night.
While Webvan was popular, the money spent on infrastructure far exceeded sales growth, and the company eventually ran out of money. As part of its shutdown process, all non perishable food was donated to local food banks. Webvan's legacy consist thousands of coloured platic shipping bins for groceries that are still siting in customer's basements and closets.
The online grocery market sector has seen many other failures, including Publix Direct. However there have been a few successes. Analysts blamed the failure of Webvan is caused by a serious error of judgment on the fact that none of Webvan's senior executives had any management experience in supermarket industry. Another factor that contributes the disaster is the Webvan policy of trying to embrace a total customer satisfaction model involving 30 minute window delivery without considering that many working customers would like their groceries delivered at home at night.
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