Pets.com

Pets.com started in a very crowded field surrounded by companies that were similar in their names, products and goals and it needed to get ahead of the pack. Marketing and advertisement are the way to make a mark to consumers and to stand out in some significant manner. The major pro was that the marketing strategy gave Pets.com that edge that made it a part of popular culture and made it recognizable in a sea of competitors. Its inclusion in popular events (Super Bowl, Macy’s Parade, etc.) go a long way to making a mark in the memory of shoppers. While the cultural and mainstream recognition brought was a Pro, the fact that this bled them dry is a con. It was costing more money to obtain customers than the company was bringing in in revenue, showing just how important timing was to the recognition of revenue. In the end the excessive spending was a major flaw in spending and budgeting.

Pets.com priced its items below the sales price of the brick and mortar stores and regularly had sales, promotions and discounts for many products as well. Pricing items lower than stores as well as the promotions were plausible tactics because online stores can generally afford to do this as stated by the article. The pricing strategy used by Pets.com was not necessarily a bad one in its entirety. The money not made by giving discounts and having promotions was recovered by incidentals like selling client lists and advertisement space. The shipping was the portion of the pricing that appears to have caused many problems for Pets.com. With no warehouse on the east coast, it cost far too much money for Pets.com to keep giving free shipping as an option to customers, yet they continued to do this entice customers to place more orders.

I believe the sock puppet was an effective strategy because it brought visibility to the company. Creating a recognizable brand ambassador is key to many companies’ success. Pets.com was faced initially with many competitors offering in essence the same experience that Pets.com was offering. Anything this company could do to incorporate itself into the mass consumer psyche would be an advantageous move. A simple sock puppet became recognizable enough to be on magazine covers and featured on popular programs; this is great thing for a national company. The sock puppet was loved by consumers and it actually received letters of support that were sent to the company as well. Although the marketing of the sock puppet cost a considerable amount, the goal of the sock puppet was to associate it in the minds of consumers with online pet products, a goal that the article states was achieved.

The biggest advantage to being linked with Amazon was the recognition and security of being associated with such a heavy hitter. Amazon was respected and recognized by the industry for its growth and customer relations. This combination is hugely advantageous because all of these start-up online pet stores needed recognition, and the confidence of investors. With Amazon, Pets.com was able to get that level of confidence that could lead to investors taking a more comfortable look at it. A disadvantage of being associated with Amazon was that despite Amazon’s success it was unable to help meaningfully lead Pets.com in the right direction in terms of marketing and spending. Amazon had itself focused more on growth than profit and it appears that Pets.com was following that same model, except in the case of Pets.com it failed and could not be sustained.