Brand Failures

81 Pets.com
In the mid-1990s, when the commercial potential for the Internet was
beginning to be realized, people started to register Internet addresses with no
intention of using them. This so-called land-grab was fuelled by a desire to
sell these addresses at a later date.
Indeed, names such as business.com and sex.com proved to be so attractive
to certain companies that millions were paid for the right to set up a Web
site at that address. The belief was that if someone was looking for business
information or pornography they would type a generic name into the address
box in the assumption that it would lead to a relevant site, if not the most
relevant site. It was also anticipated that such a name would be easy for
Internet users to remember.
One of those who set about registering addresses was Pasadena-based
entrepreneur, Greg McLemore. Among the hundreds of generic names he
chose was Pets.com. However, instead of selling the name he decided to use
it himself in a bid to target the highly lucrative US pet market.
This wasn’t just going to be any old Internet company. Pets.com was set to
be huge. Immediately after founding his venture McLemore relocated to San
Francisco and went on the hunt for investment. In early 1999, he found it.
Hummer Winblad Venture Partners, a highly respected venture capital firm
based in Silicon Valley, liked what it saw and decided to fund the company.
So did Jeff Bezos, owner of a golden Labrador retriever and a certain online
bookstore called Amazon.com, who was sold a 50 per cent stake in Pets.com.
In a March 1999 statement to the press Bezos declared his enthusiasm. ‘We
invest only in companies that share our passion for customers,’ he said.