EToys.com

» see etoys.com as it lived, on the wayback machine

~ the obit ~

EToys was incubated inside Idealab, the Pasadena startup factory Bill Gross was running in the late 1990s. Toby Lenk, an ex-Disney executive with an MBA pedigree, ran it. The thesis was the cleanest possible version of the dot-com playbook: take a category that shipped well by mail order and capture the holiday rush before Toys R Us figured out the web. The site launched in late 1997 and grew fast.

The IPO on January 4 1999 was the moment that defined the company. Shares were issued at twenty dollars. They closed the first day at seventy-six. For a stretch of 1999 the paper value of EToys exceeded the paper value of Toys R Us, which was an absurd outcome that the financial press treated as evidence that the world had changed. The 1999 holiday season looked good in revenue numbers and looked terrible in customer experience. Warehouses could not ship fast enough. Plenty of toys arrived after Christmas, and apology refunds went out by the truckload.

The 2000 holiday season was the second strike. EToys spent heavily to fix logistics and still missed the bar. By March 2001 the cash position was unrecoverable and the share price had collapsed. Venture money for unprofitable e-commerce had stopped flowing. The company filed for bankruptcy on April 1 2001. KB Toys bought the operating assets for around five million dollars. The domain went through a couple of revivals before Toys R Us picked it up in February 2009 to redirect to its own site.

i was 13 when etoys launched and 17 when it died. an american toy store with US-only fulfillment was not part of the internet i had access to. the part i remember from that era was the broader noise: cnn talking about valuations no one could justify, plus a slow cooling that turned into the dot-com bust everyone i knew read about. etoys was one of the names that came up later in those retrospectives, alongside pets.com, as a stand-in for the whole period.

~ the rap sheet ~

~ the warehouse problem ~

The lesson EToys was teaching, without meaning to, was that consumer e-commerce in 1999 was bottlenecked by physical fulfillment. The web ordering experience was the easy part. Moving toys at holiday volume out of a small number of warehouses with a small number of trained workers was the hard part. Toys R Us would later partner with Amazon precisely because Amazon had spent the years EToys did not have figuring this out. EToys treated logistics as a problem to throw cash at. Amazon treated it as the business.

~ the etoy.com fight ~

One of the more bizarre footnotes of EToys was the 1999 attempt to seize the etoy.com domain from a Swiss net-art collective that had registered it years before EToys existed. The legal team filed a trademark suit and got a temporary injunction. The art world responded with a coordinated online campaign called the "Toywar" that included hundreds of websites attacking EToys and a stock-price-tracking activist effort. EToys eventually backed down and dropped the suit. The episode is now a small classic in early internet activism history.

~ the second life ~

The brand technically did not die in 2001. KB Toys ran the etoys.com URL as a sub-brand. After KB Toys went bankrupt in 2008, the rights drifted into hedge-fund hands and then to Toys R Us in 2009. Toys R Us then went bankrupt itself in 2017 for unrelated reasons and the etoys.com URL slipped into long redirects and parked-page status. The original 1999 EToys, the company with the warehouses and the Super Bowl ads, has been dead since the morning of April 1 2001.

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