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Cyberian Outpost

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Cyberian Outpost, Inc.
Company typePublic company
Nasdaq: COOL
IndustryE-commerce
Founded1995[1]
FounderDarryl Peck
Defunct2001 (2001)
FateAcquired
SuccessorFry's Electronics
Headquarters
Kent, Connecticut
,
United States
ProductsComputer hardware & software
RevenueIncrease US$355 million (2001)[1]
Number of employees
300[2]
Websiteoutpost.com

Cyberian Outpost was an online vendor of discount computer hardware and software that operated the website outpost.com. After its IPO in 1998, it reached a peak market capitalization of $1 billion, but, after the bursting of the dot-com bubble, its stock price fell rapidly and the company was acquired by Fry's Electronics in 2001 for $21 million.[3]

The company received publicity for its controversial advertisements including one in which gerbils were shot out of a cannon, one where wolves attack a high school marching band, and one where children in daycare are being tattooed with "outpost.com" on their foreheads.

History

Cyberian Outpost was founded in 1995 by Darryl Peck.[1]

Cyberian Outpost was one of the earliest successful online-only retailers. Unlike many large retailers of the time, the company marketed directly to expert consumers instead of businesses and specialized in hard-to-find Macintosh products in a market saturated with Microsoft-compatible products. Outpost.com marketed its products around the world and offered its website in 11 languages and sold to customers in 140 countries.[4][5]

The company expanded rapidly, taking advantage of the booming Internet. Revenue increased from $1.9 million in the year ended February 29, 1996 to $22.7 million in the year ended February 28, 1998.[5]

In 1997, Money Magazine rated the site as "Best Site for Computer Equipment".[4][5] Outpost.com raised $2.7 million in venture capital in 1997, at which point the site had 25,000 visitors per day and 1.3 million customers.[2] The company secured another $22 million in financing in 1998,[6] and raised another $70 million from its initial public offering.[2] Outpost.com opened a warehouse in Ohio that could guarantee next-morning domestic delivery and worldwide delivery within 48 hours.[4]

After the dot-com bubble burst, the company fell on hard times. In 2001, the company entered into a merger agreement with PC Connection but then terminated that merger agreement and the company was sold to Fry's Electronics for $21 million including the repayment of $13 million in debt from PC Connection.[7][8][1][9] At that time, the company had 1.4 million customers and 4 million visitors per month to its website.[1]

Marketing

Outpost.com forged marketing partnerships with major Internet portals, such as AOL, CNet, and Lycos[10] in which Outpost.com was featured on these popular websites.[5]

Outpost.com hired Cliff Freeman to produce TV ads, whose agency had created the "Pizza Pizza" campaign for Little Caesars and the "Where's the Beef?" campaigns for Wendy's International.[4][11] Outpost.com adopted a zealous and controversial marketing program which included a Super Bowl ad in which fake gerbils were shot out of a cannon at the company logo,[12] followed later by an ad that featured a high school marching band being attacked by a pack of ravenous wolves,[13] and another ad portraying pre-school toddlers being tattooed with 'Outpost.com' across their foreheads.[14]

References

  1. ^ a b c d e CYBERIAN OUTPOST INC FORM 8-K
  2. ^ a b c Boughton, Kathryn (March 19, 2013). "Kent School alum purchases former 'Outpost.com' building for school use". New Haven Register.
  3. ^ FLYNN, LAURIE J. (July 24, 2001). "As Cyberian Outpost plunges toward the abyss, two suitors wait patiently to pick up the pieces". The New York Times.
  4. ^ a b c d Parry, Mark E. (October 21, 2008). "Cyberian Outpost". SSRN 910080. {{cite journal}}: Cite journal requires |journal= (help)
  5. ^ a b c d CYBERIAN OUTPOST, INC. Form S-1
  6. ^ "Cyberian Outpost Initiates CEO Search to Continue Momentum; Seeks Executive to Lead Next Phase of Growth and Corporate Development" (Press release). PRNewswire. May 3, 1999.
  7. ^ "Fry's Electronics, Inc. to Acquire Cyberian Outpost, Inc" (Press release). PRNewswire. August 31, 2001.
  8. ^ "Cyberian Outpost, Inc. and PC Connection, Inc. Terminate Merger" (Press release). PRNewswire. September 4, 2001.
  9. ^ "Outpost.com Announces Completion of its Merger with Fry's Electronics" (Press release). PRNewswire. November 8, 2001.
  10. ^ Agreement - Lycos-Bertelsmann GmbH. and Cyberian Outpost Inc.
  11. ^ Patel, Kunur (November 2, 2009). "Where's the Shop? Cliff Freeman Slips Into History Books". Ad Age.
  12. ^ Gerbils shot out of a cannon
  13. ^ Wolves attack a high school marching band
  14. ^ Children in Daycare being tattooed with "outpost.com" on their foreheads
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