Someone seems to think nandemo is joking, so to clarify, there exists at least one HNer whose business does sell pet food over the Internet. They tried to hire me at one point.
Yeah yeah, pets.com blew up. Banks have gone bankrupt before, too: that doesn't mean banking can't make money.
Yes. There was nothing especially wrong about the idea of selling pet food online then; another company started by selling books (a worse idea if you ask me) and they did go fairly well.
That's not to say that it's a good idea to start an online pet food business now. By now the margins must be pretty low. But it is an "old" idea for which the market is still big.
The problem Pets.com had was trying to build a billion dollar company selling pet food online. There is nothing wrong with selling pet food today as long as you stay lean and focus on the niche items and or bulk.
Exotic pet food (Squids) + supply's + information.
Bulk shipments of food + breeder information for show dogs.
PS: I have a friend who has been making good money selling cookies online. It's a classic small business with a few workers in a low cost of living area, and it's been steadily growing for a while now. (http://www.thebestcookie.com/) There secret IMO is simply high quality and high minimum order sizes.
Your friend needs to learn some things about SEO. If you look at the bottom of his site, there are about 40 different domain names that all point to the same content.
This is a huge duplicate content issue, and there are much better ways to target multiple keyphrases.
If i understand you correctly, one does have to pick a big industry, pick a niche, (sell in bulk,) combine it with something else to add more value compared to similar products?
All companies make money by adding value, the goal is to maximize value created while minimizing the cost and then benefit by charging people based on that gap. The niche is really the type of value your creating and you need to pick a niche is the correct size for your needs and capital. There is a world of difference between the ideal niche for a collage student trying to make some beer money, an unemployed coder trying to make rent, and 3 collage friends who just got 2 million in funding. The smaller the company the more nuanced it's approach and the smaller the niche, can be. What might look like a product feature to Microsoft may support 5 different tiny software companies all going after different angles.
The specifics relate to the market and the kinds of product sold. You are not going to make money shipping individual 50lb bags of dog food to people, but you might be able to make money shipping pallets of dog food to people. Things like building communities or creating content are really just another form of advertizing that is theoretically cheaper to create in the long run than Adwords.
> another company started by selling books (a worse idea if you ask me)
Nope, IMO it's f*cking perfect. Having worked for a book distribution company: the item is easily packaged, it's easily identified by the purchaser (no brand confusion), it's easy to use with no support costs, all items from the publisher are sale-or-return - any excess inventory goes straight back to them rather than clogging the store's shelves if it doesn't sell. Amazon also used the Internet to overcome the traditional problems with book distribution: which titles to carry and market, because there are so many. Just carry all of them.
You forgot one of the most important details: Books have a high cost:weight ratio -- between $10 and $200 per lbs -- which ensures that shipping costs stay reasonable. Pet food tends to be around $3/lbs.
I buy dog food online - rotations. I think the company struggled selling through traditional distribution so they went direct by selling online. It's a great business model. They have a differentiated message(it's bad to feed your dog the same exact food for its entire life) and the prices are comparable to premium dog food purchase in a store.
