It was too good to be true: The opportunity to jump on the dot-com bandwagon of riches – and it seems, everybody took the leap. Well, not everybody (I, for one, didn’t) but the lure brought in people from all walks of life. Some bought stock with dreams of early retirement and others left jobs to sign on with a company that raised their pay, gave perks, promised 401(k) stability and on top of that, there were those stock options. Whew. Heady stuff.
But it’s all gone. Just like that.
In this case, it was Webvan, which announced last week that the plug was pulled on the idea that people would love – love, I tell you – to order groceries over the Internet, have someone else do the grocery shopping for them and have the goods delivered to the front door.
With the announcement that the company was filing for Chapter 11 bankruptcy protection, the boom was lowered on 2,000 employees. It was an end too for the customers they serviced in California and part of Oregon and Illinois.
The company pulled in millions in investment bucks which got the idea launched, and funded the staff, facilities, equipment and a blitz of advertising that left the public thinking that their local supermarket would be empty of customers.
The venture capital bucks made it possible to hire the people needed to do the work. Not just the computer geeks nor the execs who preened in the blush of initial success and rising stock prices, but the folks needed for the warehouse and the trucks and all the other, hidden jobs that make any company function for success.
Reports are that these folks were tempted in by all the goodies that often weren’t part of the jobs they had before. But even more, there was the lure that as stock prices rose, their futures were assured. No one told them it doesn’t usually work that way and indeed, it didn’t.
While the 2,000 got the hit, it was reported in the media that Louis Borders, who was the founder of Webvan Group, Inc., sold most of his stake in the company less than three weeks before the bankruptcy announcement. He only got 6 cents a share for his 45 million shares, but I guess raking in $2.7 million is better than nothing. Tough for all those employees who held options and had no clue that the end was near. For them, it’s bye-bye.
But what about the basic idea? I mentioned that I didn’t buy into it either as a stock buyer or as a customer. Except in an emergency, which hopefully occurs only rarely, why on earth would I want someone else to shop for my food? How would they know which head of lettuce or bunch of carrots is best? How would they know which cut of meat is the best looking, freshest and best priced? From what I could figure, having my shopping done that way would be like buying a pig in a poke and that sounded pretty dumb to me.
But there’s more, and it shows that some of these hotshot young (and not so young) entrepreneurs just don’t get it. For many people, food shopping is a kind of event. No, not when you are frazzled and need to run in to buy a few items or are pressured with a terrible work schedule. But I’m talking about normal folks who shop once or twice a week. Part of it is shopping – i.e., comparing quality and price and special offers and using coupons or trying other brands, or, or, or.
Another aspect of markets is that they tempt us to part with our hard-earned dollars. With coffee available, samples that whet the appetite, gourmet deli counters, fish markets, organic foods, ethnic specialties – not to mention hardware, magazines, toiletries, greeting cards and gift wrappings, party needs and beer, wine and hard liquor.
It’s not “food shopping,” it’s shopping. And you can’t do it by phone or on the Internet.
There’s also the social aspect. If you shop regularly in a market, you see friends and neighbors, you chat with clerks and managers, you even, believe it or not, sometimes talk to strangers. I know of markets that are great places for meeting interesting folk of the opposite sex. Hey, you do what you can.
For mothers with young children, the outing to the store can be a bright spot in the day, providing the kids aren’t cranky. For older folks, it’s often a chance just to get out of the house. What’s wrong with that?
So while I’m sorry for the workers out of a job and out of that golden future, and a bit sore at Louis Borders for pulling out just in time to avoid the big hit, I’m not at all sorry that the idea flopped. On paper, it looked good, but it left out the most important part of shopping. It’s not really about food or supplies – it’s about the ambiance.
Remember the advertising advice, don’t sell the steak, sell the sizzle. Webvan forgot. Sorry about that.