Dot-Com Death by Degrees

The headlines are daunting. Every day seems to bring at least one dot-com failure to the fore. But for all the wisdom of trying to see the big picture, we need to zoom in and consider what this shakeout means for the individuals.

I’m not talking about employees. There’s good evidence they’re getting hired as fast as they’re getting laid off.

I’m talking about the customers. Remember the customers? One by one, they’relearning that e-commerce is no longer thecozy community it once was (or seemed), and that it’s every man for himselfwhen the money dries up.

Goodbye and Good Luck

As mortality stared them in the face, some dot-coms read the writing on the wall and planned ahead to leave this world with enough cash in the bank to cover their debts to society and their customers.

Others did not. And the most striking example of the latter category, by far, is ShopLink.com.

ShopLink operated in a narrow geographical area, mainly in New York and southern New England. It had an upscale focus, doing busy work for busy people, including grocery shopping, picking up dry cleaning and the like.

Well, on Tuesday, ShopLink turned out the lights for good,catching everyone who watched the company off guard. Some analysts had even pegged ShopLink as a potential beneficiary of the recent demise of Streamline.com, an online grocer whose headquarters were just down the street.

No Thank You, Don’t Come Again

But those caught most off guard were ShopLink customers. By all accounts, the firm e-mailed a letter to its customers, slapped a copy up on the Web page and hit the highway. The letter noted that, as of that minute, “No associates will be available to handle your queries.”

The letter goes on to tell customers so much more. Those shirts that we took the dry cleaners for you? You’re going to have to get them yourselves. That prescription we were going to fill? Might be waiting at the drug store. Might not. Here are the phone numbers and addresses of the vendors we used. Good luck.

Oh — and one more thing: “As a security precaution, we would strongly suggest that you alter any garage door access codes that have been communicated to us for delivery purposes, and remove any keys that may be stored in lockboxes.”

Thanks a lot.

Saying Sorry

As you might expect, the letter closes with an apology from chief executive officer John R. Icke “for any inconvenience” that might have been created.

Now, I sympathize with Mr. Icke’s plight, to an extent. But I don’t, as it happens, buy his argument in the letter that capital markets are turning their backs on business-to-consumer Web sites “irrespective of their current performance and long-term value.”

In any case, his customers deserved a whole lot more than “I’m sorry.” Think of it — a company that built its reputation on convenience leaving nothing but headaches for its customers.

How much does it take to realize you’re going to come to work one morning and have to shut things down? Not too much. No Harvard MBA in the CFO’s chair. No complex cash-burn matrix. Nothing except a little respect for the customer.

A Closer Look

Let’s take a moment at this point to zoom in. An acquaintance of mine used ShopLink for several months. Now she’s faced with a decision: Does she dial up another service? Peapod is operating in the neighborhood already, after all. Maybe she will.

But my guess is that while she drives around doing — no, re-doing — the tasks she contracted ShopLink to do for her, she will think twice about hiring another dot-com errand boy. The stain of this bad experience will color her entire view of the dot-com world.

Another acquaintance decided the day before ShopLink’s demise to see if the service might simplify her frantic life a bit. She placed her first order a matter of hours before things went dark.

Now she doesn’t know whether her credit card information is safe or if it was pilfered by an employee on the way out the door. And she can’t get anyone at ShopLink to answer her questions. In other words, the frantic-meter in her life went way up, not down.

Dot-Com Dignity in Defeat

That’s two very unhappy customers with stories to tell, stories they are already telling and re-telling to co-workers, friends and family, all of whom are potential customers of every e-tail site on the Web.

Will the sting wear off? You bet… over time. Will people take their stories of woe to heart? Some will… right away.

The diehard e-commerce believers will try to build a firewall, saying that the problems were Shoplink’s alone. But the skeptics will use it as one more reason to spend their money only in stores with four walls and cash registers that make noise.

Maybe those burned will be brave enough to try again one day. But there is no way they’ll ever forget. E-commerce already has enough hurdles standing in its path to wider acceptance. Does it really want to keep adding another one to the list?

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

2 Comments

  • I know this story was written a while ago, but I just wanted to say that customers weren’t the only people who were hurt by Shoplink closing down. I worked there for about a year, and I did have a feeling that it wouldn’t last so I left. My mother was there for 3 years, up until the business closed. The VP was to blame, he worked for another company that shut down as well. Also, he was a terrible businessman. John Icke left a lot up to him. Anyway, the only people that knew that Shoplink was closing were Icke and the VP. Nobody else knew. All of a sudden, the day Shoplink closed, all of the employees were out of the job. My mother didn’t even get compensation, she just lost her job! That’s right, no compensation whatsoever. I was a freshman in college and we had to cut back on everything. She couldn’t find another half-decent job for almost a year. This article is whining about how customers lost their laundry??? What about the employees at Shoplink who lost everything?!? The customers really didn’t lose that much in comparison…..

    • Hello,
      I’m a freelance writer researching a story on John Icke and the bankruptcy of Shoplink Distributing Ltd. Mr. Icke has been selected to be the CEO of a company being formed in British Columbia, Canada. This compay, Accenture Business Systems of BC, will include 2100 staff carved out of the publicly owned BC Hydro.
      I have been able to obtain the list of unpaid creditors in the Shoplink bankruptcy. (http://www.citizensforpublicpower.ca/newsroom/icke/claimsreport.htm) Research has revealed that Andersen/Accenture helped fund Shoplink, and installed a very costly computer system. Curiously, the list of unpaid creditors does not include Andersen or Accenture.
      There is an unfortunately named website, called http://www.f**kedcompany.com. The site contains a very strange combination of offensive sexual prattle, and very damning commentary on troubled companies. Despite its liabilities, the site has become a reference source for that type of information.
      A search for "Shoplink" turns up a discussion thread, in which many persons claiming to be former Shoplink employees have posted claims critical of Mr. Icke and their treatment by Shoplink.
      Unidentified former Shoplink employees have claimed they received no severance pay. Mr. Icke recently claimed in our local media that he paid back pay owing to employees, out of his own pocket. Back wages are different from severance pay, and I’m trying, to establish what was owing, to who, and what was paid. Journalists have raised the matter of Mr. Icke’s purchase of a $2.5 million house as the bankruptcy developed.
      Mr. Icke recently claimed he chose Chapter 7 bankruptcy proceedings in the US because it would result in equitable treatment of creditors, and cited the lack of Shoplink lawsuits as proof of his success. In fact, the sole reason for choosing Chapter 7 is that it nullifies subsequent lawsuits. Thus, the lack of lawsuits is not to his or Shoplink’s credit.
      In addition, Chapter 7 does not allow seizure of assets on which payments are being made, such as the mortgage on a costly house. There is also the question of why Accenture/Andersen is not on the list of creditors.
      I believe it is important to the integrity of society that corporate misdeeds be public matters. I would be extremely grateful if you could shed any light on these matters, or could connect me with anyone else who could assist in clarifying these matters.

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