Here’s the lesson in this fiasco that went directly into the marketing books of shame.

No proper business model that wasn’t going to be profitable in the long run was ever going to survive any hype generated for it. In other words, if a business cannot make enough money to offset the cost of running itself, no amount of hype or the application of the “First Mover Advantage” is going to change that fact.

Now

BILLIONS OF DOLLARS were in turn spent on hiring lots of people, renting huge premises, leasing heavy office and computer equipment in quite a few places around the world. Hundreds of millions of dollars more were spent on heavy advertising in the media to draw the public to their web sites.

Never a day went by when you didn’t hear of “this dot com company” or “that dot com company” screaming out to you for your attention for you to avail yourself of their products or services. If you were lucky enough to be caught up in the frenzy, you’ll remember very clearly what that feeling was. Everywhere I looked I saw ads for a dot com. Some were very nice to look at with extremely catchy tag lines.

Unfortunately, most of those companies’ business models were based mainly on the hype surrounding the Internet, unproven big ideas and the “First Mover Advantage” - with the ultimate reward for their founders and backers being a listing of their companies on the Stock Exchange.

Multi-millionaires sprung up overnight from Internet ventures that got listed which excited the venture capitalists and entrepreneurs even more, which resulted in even more billions of dollars being pumped into new Internet projects. Because at that time it would appear that the journey to millionairedom was just a few months away, rather than the years it would take the conventional way.

Venture Capitalists were on the prowl to fund a good management team with a big idea that had the Internet involved in some way. Because the Internet was very new then, nobody would know whether those big ideas would bring in the gold. However the game wasn’t to see if they would - the game was to list the dot com companies as quickly as possible at all cost, and get rich from the exercise. Of course, it was only a matter of time before things became clearer to those involved, with very painful consequences.

Here’s the lesson in this fiasco that went directly into the marketing books of shame.

No proper business model that wasn’t going to be profitable in the long run was ever going to survive any hype generated for it. In other words, if a business cannot make enough money to offset the cost of running itself, no amount of hype or the application of the “First Mover Advantage” is going to change that fact.

Now

Never a day went by when you didn’t hear of “this dot com company” or “that dot com company” screaming out to you for your attention for you to avail yourself of their products or services. If you were lucky enough to be caught up in the frenzy, you’ll remember very clearly what that feeling was. Everywhere I looked I saw ads for a dot com. Some were very nice to look at with extremely catchy tag lines.

Unfortunately, most of those companies’ business models were based mainly on the hype surrounding the Internet, unproven big ideas and the “First Mover Advantage” - with the ultimate reward for their founders and backers being a listing of their companies on the Stock Exchange.

Multi-millionaires sprung up overnight from Internet ventures that got listed which excited the venture capitalists and entrepreneurs even more, which resulted in even more billions of dollars being pumped into new Internet projects. Because at that time it would appear that the journey to millionairedom was just a few months away, rather than the years it would take the conventional way.

Venture Capitalists were on the prowl to fund a good management team with a big idea that had the Internet involved in some way. Because the Internet was very new then, nobody would know whether those big ideas would bring in the gold. However the game wasn’t to see if they would - the game was to list the dot com companies as quickly as possible at all cost, and get rich from the exercise. Of course, it was only a matter of time before things became clearer to those involved, with very painful consequences.

Here’s the lesson in this fiasco that went directly into the marketing books of shame.

No proper business model that wasn’t going to be profitable in the long run was ever going to survive any hype generated for it. In other words, if a business cannot make enough money to offset the cost of running itself, no amount of hype or the application of the “First Mover Advantage” is going to change that fact.

Now

Multi-millionaires sprung up overnight from Internet ventures that got listed which excited the venture capitalists and entrepreneurs even more, which resulted in even more billions of dollars being pumped into new Internet projects. Because at that time it would appear that the journey to millionairedom was just a few months away, rather than the years it would take the conventional way.

Venture Capitalists were on the prowl to fund a good management team with a big idea that had the Internet involved in some way. Because the Internet was very new then, nobody would know whether those big ideas would bring in the gold. However the game wasn’t to see if they would - the game was to list the dot com companies as quickly as possible at all cost, and get rich from the exercise. Of course, it was only a matter of time before things became clearer to those involved, with very painful consequences.

Here’s the lesson in this fiasco that went directly into the marketing books of shame.

No proper business model that wasn’t going to be profitable in the long run was ever going to survive any hype generated for it. In other words, if a business cannot make enough money to offset the cost of running itself, no amount of hype or the application of the “First Mover Advantage” is going to change that fact.

Now

Venture Capitalists were on the prowl to fund a good management team with a big idea that had the Internet involved in some way. Because the Internet was very new then, nobody would know whether those big ideas would bring in the gold. However the game wasn’t to see if they would - the game was to list the dot com companies as quickly as possible at all cost, and get rich from the exercise. Of course, it was only a matter of time before things became clearer to those involved, with very painful consequences.

Here’s the lesson in this fiasco that went directly into the marketing books of shame.

No proper business model that wasn’t going to be profitable in the long run was ever going to survive any hype generated for it. In other words, if a business cannot make enough money to offset the cost of running itself, no amount of hype or the application of the “First Mover Advantage” is going to change that fact.

Now

Here’s the lesson in this fiasco that went directly into the marketing books of shame.

No proper business model that wasn’t going to be profitable in the long run was ever going to survive any hype generated for it. In other words, if a business cannot make enough money to offset the cost of running itself, no amount of hype or the application of the “First Mover Advantage” is going to change that fact.

Now the First Mover Advantage is a concept that says that if you’re the first to be seen everywhere offering your product or service on the Internet (even though you may not be the FIRST to do so, only the first to be SEEN to do so), you’ll gain a great business advantage over all your competitors who came onto the scene later, or who were there earlier but only advertised themselves strongly after you came onto the scene.

By being first, you’ll get the most number of customers and you’ll make the most number of sales and you’ll be the preferred choice for your Prospects to do business with, because it’s always easier to remember the first company to offer a certain product or service.

This belief in the First Mover Advantage concept caused hundreds of millions of dollars to be spent on HUGE media campaigns very quickly by Internet companies during the dot com boom. They were advertising everywhere - on the Internet itself, on television, radio, newspapers, bus panel, billboards and just about any spot you can think of that could hold an advertising message. They advertised during prime time in the media (like during the Super Bowl, for example), the time when a single ad could cost millions of dollars.

Most of those companies were wound up in no time, when it became clear that they were burning up more money in operations and advertising cost than they were earning them in pursuit of the “First Mover Advantage”.

The end result?

The only ones who got filthy rich were the Advertising Companies (if they were paid before their clients went bust), and the lucky few who managed to list their companies before the bubble burst on them.

Now you may think that the “First Mover Advantage” concept isn’t a valid one.

But you would be wrong.

The problem isn’t with this concept, but the fact that their business models weren’t profitable in the first place. Nobody had done their business the way they had on the Internet before - so nobody would know how it would turn out. The hype of untold riches apparently sug