An Example Of E-Commerce Failure And Its Causes

Toys R Us Company is one of the examples of the ecommerce failure which I would like to share with everyone. This company is the leading retailer of toys, children’s apparels and baby products in the world. It provides customers with an unparalleled online selection of distinctive toy and baby products. In 1999 Toy R Us announced to create an e-commerce subsidiary – ToysRus.com. It has established as a video game, premier online toy and baby store outlet.

There are few reasons that cause Toys R Us Company towards its failure. The main reason is the formation of the company convert to the e-commerce system. Frankly, not all the company possess huge capital to invest in e-commerce system especially small company since it is large expansion for the company. Hence, if the company face the economy crisis due to the large expansion, it will influence the milestone of the company in the future.

Moreover, when Toys R Us Company changes into the e-commerce system, they neglect some common factors that will affect the operation of the company during the holidays. Shipping product takes man power during the holiday season. It will tend to slow down the process simply by the sheer volume of orders of the mail service industry receives in that short period of times.

On the other hand, the another cause of the Toy R Us Company is the inability of the customer to choose the product that are more effectively sold online than in the real world. Particularly online clothing shopping requires the customer to conjecture at what they had looked at the garments through the website. Further, the company will produce a fictitious image to catch the consumers’ attitude to purchase their products. It makes the customer hesitate for purchasing products presented on the website.

Lastly, the failure cause is delivery service provided by the company. As we know that, while delivering cannot be offered on time, the customers can request for the compensation. As a result, failure to deliver the ordered stock on time to customers created Toy R Us Company give away hundreds of $US100 vouchers to displeased customers.