'Turbulent times' for Amazon and other 'e-tailers' in 2001
Some online businesses failed, but there were also successes
As Peter Mansbridge described it on CBC's The National on Jan. 31, 2001, it was "turbulent times for e-tailers."
At the time, there had been "talk of an economic slowdown in the U.S.," he said.
Some online sellers were already struggling, or even stopping altogether, as reporter Norman Hermant discovered. But at least one business was doing well.
"Grocery shopping, internet-style," Hermant said, as a man was seen unloading a delivery truck for Grocery Gateway.
Online groceries succeeded...
The company, which offered groceries at the click of a mouse, was enthusiastically embraced by customers.
"I think it's the best thing since sliced bread," said a happy recipient after her groceries had been unloaded at her house.
Grocery Gateway's website, trucks, employees and warehouse were all "very expensive costs of doing business," said Hermant. But he described the company's online business as "thriving."
Not so for Amazon.com, which sold "everything from books to clothes," explained the reporter. Nearly one-fifth of its workforce was facing layoffs.
"The world's largest internet retailer has never made a profit," said Hermant, as worker operations inside an Amazon warehouse were seen. "From last October to January alone, it lost more than $800 million."
Regardless, Amazon insisted it was going to make money — "eventually," said Hermant.
... Other companies failed
As further examples of trouble for the dot-com world, Hermant said Disney had been "forced" to shut down its web portal, Go.com, that week. Ditto for MVP.com, a website launched by athletes Wayne Gretzky and Michael Jordan.
"It seems so many dreams just go up in smoke," said Rick Broadhead, described as an internet consultant. 'It's very depressing."
Hermant described the problem in more detail: internet companies that failed tended to focus on the wrong mix of personnel to run things.
"If you're going to sell on the internet, you better have a load of retail experience, you better have a load of business experience," said Broadhead. "Technical experience doesn't cut it."
