Shoes.com shuts down | Hacker News Reader

Shoes.com shuts down

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54 pointsuladzislau47 comments

It's kind of amazing that very few of what you would naively expect to be the "best" domain names, especially for selling things, are actually home to successful business. Things like shoes.com, pizza.com, clothes.com, beer.com, programming.com, they're all failed or nothing. Others (books.com, computers.com) just redirect to websites that are closely or tangentially related.

One theory I'll toss out about these failures is that it's a people problem. They probably have marketing people leading them, hence why they bought such a "great brand". Turning revenue doesn't mean making a profit and without enough focus on tech automating as much as possible the businesses don't survive.

As a 'marketing person' I have to starkly disagree with this theory. No marketing person worth their weight in salt thinks that a generic TLD is a "great brand". Branding is quite specifically a matter of owning mindshare with a unique name or mark that can be easily recalled at a point in a buyer's journey.

Let's not go belittling people because it's not your area of expertise. Plenty of great businesses lead by branding people that don't focus on tech-automation end up succeeding. There is more than one path to success.

Also I suggest you check out the 11 immutable laws of branding by Al Ries, it's basically a branding bible and a short and easy read! Maybe you'll find a few tidbits of use from those 'marketing people' :)

Generic words are not brands. I have no feelings about shoes.com nor can I ever other than I like shoes. I care about certain brand of shoes because they look nice and last a while, i.e. quality. That's why companies fight to keep their brands from becoming generic names.

Indeed, it's a shame that that company Microsoft (remember them? They made a BASIC interpreter for CP/M) chose useless names like Windows and Word.

The string, be it Google (nonsense word, to most people), Windows (generic word), or Apple (real word out of context) is all about what you do with it.

Surely this is less common now, but I can remember at one point it was a pretty common behavior to say, "hm, I want some information at shoes" and just try navigating to shoes.com. Probably this became less common because porn advertisers caught on and started redirecting to porn.

Certainly it was expected that that style of navigation would be extremely lucrative. It never turned out that way of course. In large aggregate domain squatters have made some real money over the last 20 years by owning various direct type domains (like weddingshoes.com).

I remember in the mid & late 1990s, during the insane dotcom landgrab, people really believed having that special domain name was everything. At the time, it coincided with people thinking they could build a business overnight and IPO the next week, so having something like Shoes.com to sell to naive investors was crucial. I remember one guy pitching the premise, on CNBC and elsewhere, that he had acquired all the buything.com domains, like buysocks.com, and he was going to build a retailing juggernaut on the back of that.

Easy-to-remember domain names are still good. People make a lot of money parking domains and you would expect that to be impossible if they were worthless.

pets.com

https://en.m.wikipedia.org/wiki/Pets.com

Petsovernight.com. Delivering little bundles of love, in a box, directly to your door.

For most businesses marketing is far more important than technology.

In retrospect I'm surprised that anyone thought it would work this way once search became a viable way of navigating the web. I've never bought shoes IRL from a place named "Shoe Store". Following the address metaphor, I've also never gone looking for "Shoe Sreet" to buy my shoes.

It's funny you'd say that, because all train stations are in "train's street" in some countries, and in London most banks are in "Bank street" :D

A nuance of my city is that Bank Street leads to the train station, and no longer has a bank on it!

Sure, but which came first, trains or the street name? Maybe Zappos should get Shoes.com just for being where the shoes are at :)

It may be my experience from working in ecommerce and rubbing shoulders with SEO companies, but I am initially skeptical of simple domain names. Bestshoes.com? No brand, just a domain name probably picked out by an SEO mage. I would have to do my due diligence before purchasing. Sometimes I wouldn't be bothered and I would go to a brand I recall from real life.

I used to help run an online bodybuilding supplement company, and some of the shifty domains the SEO guy cooked up that people trusted blew my mind. Bestweightlosssupplements dot com. Perfect, let me pop my CC details into that site.

One thing I see a lot on HN is programmers and other highly technical users assuming their behavior reflects typical user behavior. That is quite often simply not the case.

I would definitely not be surprised if that were shown to me. I guess that's why we do A/B testing and other confirmations of our assumptions. Things that seem like they wouldn't work often do, like making a button green, or making the checkout two steps instead of one increasing conversion.

Humans are wierd.

To be fair, Google and other search engines encouraged that view for quite some time. Naive treatment of anchor text as context...

Also, I'm pretty sure browsers used to tack on ".com" before the current behavior of passing unadorned strings in the URL bar to the search engine.

Mystified by the downvote. Matt Cutts talked about the unintentional SEO advantage of exact match domains, publicly, and later they released an algorithm change to fix it.

And, I was "pretty sure", but searched a bit. My memory was right. Browsers used to tack ".com" onto things you would type into the url bar. The search box was separate at the time. Firefox, for example, had a setting called "browser.fixup.alternate.enabled" defaulting to "on" that made this the default behavior.

These kind of domains did, at one time, have a notable built-in advantage.

These domains would still have their advantage if they managed to get big before the omnibox took over, wouldn't they?

If they established a following, yes. Someone mentioned "blinds.com", still #1 for "blinds" in the US. Furniture.com is also ranking well for "furniture". The number one result for "cars" is "cars.com". Hats.com is #2 for "hats", and so forth...

The domain is a multiplier of revenues.

If you were mediocre at the execution, multiplying peanuts will not save the business.

blinds.com is pretty successful and, as far as I can tell, a good place to buy blinds.

Many of those come from a different time - the dot com boom era. Then owning the right domain meant you were 80% there. Needless to say money, effort, and time was spent getting the right domain without then leading to profits. One reason for that logic was discoverability. Before Google was Google how would you buy shoes? Well of course go to your swanky new Netscape browser and type "shoes.com".

Funny now you still go to the address bar and type "shoes" but you don't go to shoes.com but to Google who tells you where to go buy shoes

On the other hand, wine.com seems to be doing OK. I think the crux of the issue is that a good domain name still needs good brand marketing.

Pretty sure bikes.com would be doing just as well (it's Rocky Mountain Bicycles) - and (imho rarely these days) it's one of those were one company just grabbed the domain at the right point in time. If my memory serves me well in the early 00s there were quite some German companies who did this, but usually just redirected to companyname.de.

> Its approximately 200 employees were made aware of the decision early on January 27, and the company said that it will compensate the employees through to the end of the month.

So they notified their employees that same day as they shutdown. To make it right they offered them a severance of two whole days.

Given this could lead to all sort of lawsuits, it's most likely they were looking for a "plan A" that didn't work and had to quickly unravel into a "plan B". Because they are shutting down, it's entirely possible the plan A left them without money in the bank and they had to announce it within the week (being Friday the best day for layoffs).

Does anyone have insight into why this happened?

The guy who took Costal Contacts public buys Shoes.com and two existing shoe businesses. The business experiences revenue growth and raises $45M.

https://www.internetretailer.com/2015/05/21/shoescom-raises-...

Suppliers start having trouble getting paid. The business announces a hiring spree. Four months later, they shut down.

This is manic. If you can build a company and take it public, make what looks like a solid set of moves to get into a nice position and grow that position in revenue terms - what went wrong? What is the lesson? I'm assuming the CEO knew the ropes, perhaps not? Seems unlikely.

I suspect their top line was good but their margins were negative. That, something out of left field or foul play of some kind. Its noted they had lawsuits pending, which I suspect relate to collections.

I know that walmart recently purchased shoebuy. So shoes.com's competition, already stiff, may have been overwhelming.

Even so, wouldn't you wind it down then?

I help operate an online shoe retailer so I have watched ShoeME.ca (the Canadian e-retailer established in 2012 that merged with Shoes.com and OnlineShoes.com) over the last few years. Here is what I've noticed:

- Their prices were not competitive. Some brands sold for at least $60 more than the MSRP found on other sites. I don't think even Zappos could've gotten away with similar premiums – despite their renowned customer service – which according to reviews and articles, ShoeME did not have.

- They were a drop-shipper so every item had to first travel from the supplier, to ShoeME's warehouse, THEN express shipped to the customer. Shipping from their Vancouver warehouse to Eastern provinces may have cost up to $40. Drop-shipping can add over a week to delivery time depending on how responsive your supplier is. Frustratingly, ShoeME did not make this their drop-shipping transparent and would instead send you an email about the delay AFTER you had ordered.

- Fakes sales. There was never a day without a sale banner, popup, or email blast claiming 30-40% off. The moment a "last chance" sale ended, another one was put on the next day. In reality many brands were permanently excluded from the promotions. Consumers catch on quickly, especially in the online world.

- In the past year and a half, ShoeME started buying their own inventory for some brands so they clearly thought they were getting somewhere. However, anyone who has run a shoe store knows how hard it is to keep size runs full. Some styles may sell well one day, and you may not sell another pair for a few weeks. I wonder if they had enough data to anticipate customer demand without stocking too much.

- They also started work on a supplier portal which never got off the ground. While working to integrate with them starting in mid-2015 them, we constantly received incorrectly setup credentials, changing representatives, and no updates whatsoever.

- Returns. It's no secret the return rate in the shoe industry can exceed 25%. I can imagine how sprawling ShoeME's warehouse must've been considering the hundreds of brands they sold. How do you even organize all the one-off returns from different styles and manufacturers?

This announcement pretty much caught us off-guard this afternoon, although retrospectively you can see some customer service issues regarding lack of transparent drop-shipping and dishonest pricing and sales. Personally, I thought they were too big to fail and always questioned the sustainability of their constant sales and pricing.

I feel sorry for the customers who still have outstanding orders with them. Websites are all down. They're social media pages have posts from just a few hours ago so I guess many were blindsided. This is like FutureShop's sudden closure all over again.

Just a point about drop-shipping. Generally with drop-shipping the items ship directly from the upstream wholesaler to the end customer. If they used drop shipping as a way of running JIT inventory control, then I can see why they'd need to charge a large premium as they would be hit hard with shipping costs.

I keep coming back to HN for insights like this. Thanks for taking the time lawkwok.

Thanks! It's not every day I see an article on Hacker News that's not over my head :P

I remember showing my father the www, probably 20 years ago, and he was incredulous that certain .coms would exist for any reason. "You're telling me I could type 'shoes.com' and there would be a page about shoes? No way." I don't remember shoes actually being on the page anywhere, prompting the response "see? I told you it wouldn't work."

From the article: "Its approximately 200 employees were made aware of the decision early on January 27, and the company said that it will compensate the employees through to the end of the month." Gosh, how generous of them. A whole 5/7th week severance. I wonder if they were in talks with Walmart for a buyout but they acquired shoebuy instead in early January. Either way shoes.com should have shut the doors earlier and given employees more notice.

For what it's worth I'm not surprised. I had a very poor experience with them. The actual shipping time was significantly longer than promised (pretty sure their model was to act as a dropshipper), and then I was unable to get a response to return the shoes I no longer needed.

My guess is the Omnibox is decreasing the value of websites like this.

Before the browser (or ISP) would suggest things like shoes etc if you typed it into the address bar.

Now you simply get Google (or bing) results.

RIP expensive domain names with no specialized business model behind them.

This is sad to here. Roger is the man. I remember visiting him when he ran Coastal.

Given that he gave his 200 employees a 4 days of severance, he is clearly not "the man".

well if there's no money in the bank, how do you propose he give more?

I've been involved in a failing business and we knew more than 4 days out that there was no money in the bank.

Hoping the problem will go away rarely makes the problem go away.

I just got laid off from a large public tech company, and there was zero severance in the email.

Well in that case I guess it's ok?

As already mentioned, you do not get to the point of halting operations unexpectedly. They just hid it from all the employees to keep them from leaving. It's an immoral move IMHO and the sign of a business person I'd never want to work for or with.

I suspect they were holding out for Christmas sales, but even with that, the employees could have had a month notice.

When I'm buying things, I usually associate what I'm buying with the brand I'm buying from, not the generic article I'm buying. For that reason, I would respond to `allenedmunds.com`, but not to `shoes.com`.

Having a generic domain name in this case makes me think the shoes are counterfeit or otherwise not quality. Since the site is currently down, I unfortunately can't verify my own perceptions.

I associate generic domain names with "comparator" sites. If I go to shoes.com, I want to access all and every shoe on Earth. A search engine for shoes. It works well for hotels.

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