While my analysis doesn't cover every single situation of an online business that went out of business, I think it will address many. Why am I even writing about it? Because I would like to see people unafraid of bringing their business online or upgrading their internet presence or buying online. My point is that you can avoid these mistakes; going out of business is not special to online businesses... just bad ones. :)
Company Name
I'm not saying company names alone put companies out of business, but it could not have helped. Off the top of my head, some company names I thought were endlessly bad were Pandesic (ask your doctor about Pandesic and she'll tell you they used to do e-commerce), Accompany (which sounds like "a company"), and Gazoontite (a horrible spelling of a German word - how are people supposed to remember which horrible spelling to use?). Company names and identities are important... notice no shops in your neighbourhood are called "Bleh" or "Pandesic," and there's good reason for that.
Big Marketing with No Real Message
To me, this also goes with bad names. And you may already know about the problems here after all the publicity surrounding the dot coms' ads that ran through the January 2000 Superbowl. I can think of two commercials that I see now for companies that I think are still in business. One has cartoon people just saying "blah blah blah" over and over. The company I think is Avaya, I have no idea what they do, and for some reason, I've never gone to their site to try and figure it out. Another company is, I think, Genuity. Their commercials show people doing the impossible because they have a small plastic black rocketship. Again, no idea what these people do, and never had the curiosity to look. Meanwhile, I don't know about these two, but dot coms are spending tens of millions on marketing, and what kind of message is coming through? What kind of brand recognition is really happening?
Business Model
It seems obvious now that some of these companies' ideas wouldn't work. It seemed obvious then in some cases, but companies forged on, spent money, and went extinct. You can group companies with mainly bad ideas into a few categories:
