If You Want It, Here It Is...

The newest business to hit the Web? Online delivery services
Magazine Contributor
3 min read

This story appears in the May 2000 issue of . Subscribe »

You're sick. Really sick. Snotty-nose, sandpaper-throat, phlegm-rattling-cough sick. Sick with only three squares of toilet paper left, no medicine, no cable TV and a tattered 1996 TV Guide for reading material. Where is your superhero carrying super-soft tissue, high-alcohol-content cold medicine, a dumb slasher movie and this week's People?

Get out of bed and get online. Online delivery services are taking a good idea--e-commerce--and making it better. From DVD players and Palm Pilots to cold medicine and videos, what you want can be delivered free within an hour. Forrester Research estimates that on-demand deliveries in the replenishment market (grocers, drugstores and general merchandise) will reach $21 billion by 2004--and that's not even counting higher-level merchandise. What¹s the secret to making money in this arena? Deep pockets, nearly scientific logistics systems and America's thirst for immediate gratification.

The right here, right now concept is considered so revolutionary that companies like Kozmo.com Inc. and Urbanfetch Inc. are scrambling to set the industry pace-and even suing each other in the process. Kozmo recently sued Urbanfetch, alleging misappropriation of trade secrets, and Urbanfetch sued right back, charging that the lawsuit was a deliberate attempt to undermine the company. The two sides eventually settled the issue in a five-page sealed document--but neither company seems to be resting on its laurels. Kozmo.com, co-founded by Joseph C. Park with former New York Univeristy roommate Yong Kang, 27, has collected a healthy $150 million from venture capitalists, and in less than two years has penetrated six cities with 14 more to go this year. Park, 28, credits distribution and logistics, as well as lack of a storefront, for Kozmo's ability to bring in revenue from product sales and rentals while offering free, under-an-hour delivery.

Urbanfetch (www.urbanfetch.com) opened just last October, but its holiday sales were amazing. As a result of word-of-mouth marketing, New Yorkers placed an average order of $60 in December, and sales climbed to $1.5 million.

"You can divide customer experience on the Internet into two parts," says Ross L. Stevens, 30, who founded Urbanfetch with partners Fred Tausch and Mike Prindle, both 28. "Part one starts the moment you go onto the site; part two starts the moment you click "check-out" and ends the moment you have the product in your hands. The second part is more important. Adding convenience to the delivery service is going to be an important part of the way the Web [functions] in the future."

Life Online

  • The average baby boomer will spend 5 years and 6 months online.
  • The average Gen Xer will spend 9 years and 11 months online.
  • The average Gen Y user (age 10 to 17 currently) will spend 23 years and 2 months online. That's almost one-third of their lifetimes.

Contact Source

The Fortino Group, (800) FORTINO, www.e-mergency.com

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