Flashback 2000: Pets.com, New Extensions and Rick Schwartz

"It never made sense to reinvent the brick and mortar world on the Internet. But it does make sense for the brick and mortar world to use the Internet to reduce its costs and administration of sales."

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Owen......your post is a BULLSEYE!!

But when will they "Get it"?

Folks......that was the best and simplest explanation I have read in a LONG time.

BULLSEYE!!!!

Rick Schwartz

Sat Nov 18 09:24:48 2000

From the vaults:
Owen writes:
When Pets.com confirmed that its ailing business lay twitching beside the information superhighway, most press coverage focused on the e-tailer's sock puppet mascot, widely called its most valuable asset. Only CNET listed the company's "catchy URL" among the assets that Pets.com plans to sell off.

But while the sock puppet generated brand awareness so adeptly that it became its own product line, its value as a freelance pitchman is nearly impossible to assess. It helped drive traffic to the tune of nearly 47,000 unique daily visitors in September, according to Media Metrix—enough to dominate its product category, but not enough to make Pets.com profitable.

It's conceivable that a spokesdog from a high-profile failure would be viewed as damaged goods by marketers and consumers.

The company's domain name, a classic full vessel generic, is another story—and it deserves a share of the credit for the company's traffic figures. Even without a multimillion-dollar ad
campaign, search engines and URL-guessing would funnel thousands of surfing pet enthusiasts to Pets.com and its companion (thanks to its July acquisition), Petstore.com. Add to this the traffic generated by Dogs.com, another Pets.com property.

The assumptions necessary to estimate this traffic and project its value render the resulting figure arbitrary, but an Afternic staffer conducted some cursory research into the value of
Pets.com's site traffic. In the six months ended June 30, Pets.com drew an average 31,726 unique daily visitors, generating average daily revenues of $91,100—$2.87 per visitor. Were the residual cachet of Pets.com, combined with the intuitive URLs, enough to drive 1/10th of those visits—3,173 a day—and if the buyer's business model generated 1/10th of Pets.com’s revenue—$0.29 per visitor—for three years, the buyer would realize revenues of approximately $1 million.

Whether that makes Pets.com's domain names worth a million dollars is highly suspect, of course. But as a complement to an existing Web business with an interest in the pet market, or as the foundation for a start up, these domains have a track record that demonstrates tangible value and may command far more from a potential buyer than the rest of Pets.com's assets.

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Rick Schwartz replies:

Good morning folks!!

I know a lot of you don't like my thoughts on the new extensions, but step back for a moment.

Let's use Owens pet.com example.

Will pets.biz make them more or less successful?
Will pets.aero make them more or less successful?
Will pets.info make them more or less successful?
Will pets.museum make them more or less successful?
Will pets.pro make them more or less successful?

Don't like that example?

Let's try it with Amazon.com or priceline.com

The fact is the new extensions are virtually meaningless. But if you WERE to speculate, and you guys still by worthless domains......it will still be worthless. Anything more than a ONE WORD new extension at THIS point in time is SILLLLLY.

Point is.....IF you DO get a GREAT .biz, it won't be GREAT until you build something GREAT there.

Look at human nature.....

He will type in porno.com
He MAY type in porno.net (1 in 100 at best)
He MAY type in porno.org (1 in 1000 at best)

The new extensions will get even less. Especially since the most you are likely to find there is a for sale sign.

I'd rather have a $1500 .com than a 100 .whatevers

As for .biz.......wait for the SALE!!!

Have a GREAT day!!

Rick Schwartz
Mon Nov 20 08:13:15 2000 -