Www.home_improvement.com (A)

Home_Improvement.com is a US based pure Internet retailer. The case describes the Silicon Valley culture and how the company raised pre IPO venture capital. The initial funding has helped the company to become an early mover in the Do-It-Yourself Home Improvement category in the USA. However, in early February 2000, three months after having a fully operational website, the firm faces all the classic challenges confronting online retailers: the appropriate fulfilment model; customer acquisition and retention; product mix; and whether the company has a business model that will generate profits. Furthermore, competition is heating up. Besides, several new on-line retailers, the bricks and mortar giants, Home Depot and Lowe’s, are threatening to start online sales. The case allows exploration of broader questions with respect to the future of e-commerce such as: Which products and services are best suited to e-commerce? Which intermediaries in the e-supply chain are best positioned to make profits? How can companies produce sticky content? What is the correct valuation of Home_Improvement.com in the financial markets? What are the relative advantages of incumbents versus insurgents?

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