Issue 2001-8 Wednesday, April 25, 2001
|The telephone is back in full swing and customers now request useful services that really meet their expectancies||
telephone is back in full swing and customers now request useful
services that really meet their expectancies
According to James Van Dyke, Jupiter analyst, online financial services provider are more interested in launching new High-Tech products than they are in improving the usability of their Web sites (see to that matter my M-commerce article in the last issue).
And yet, according to the same study by Jupiter Media Metrix, 52% of Internet users rate customer service as the most important criteria when selecting a financial services provider.
another survey conducted by Harris Interactive confirms this tendency
as it reveals that American Internet users who use online brokerage services
favoured the telephone over the Internet to purchase investment products
during the last quarter of 2000.
stocks did we get the same proportion between the telephone and the online
channel, as they got 40% each.
|Dot-coms: when your cash stockpile happens to be higher than your market capitalization!|
And when I say their cash stockpiles are much higher than their market capitalization, it is not an idle fancy: $213 million in cash for $137 million market capitalization!
You will object that the company's "cash burn rate" might still manage to put things back in order.
But this will not happen since stamps.com, as it reduced its work force by 72%, only spends $6 million of cash a quarter and even hopes to reach break-even point in 2002.
Supposing stamps.com never even reached break-even point, and kept spending $6 million cash a quarter, it would need 35 quarters to spend it all!
This is precisely what upsets Robert Chapman, a shareholder who owns nearly 5% of stamps.com and does not seem to have much faith in the company's business model; he would rather see the company return part of its cash to the shareholders
Life is definitely hard on start-ups with a great cash stockpile!
Source : Industry Standard