14 DAY TRIAL // A software error can end up costing a company quite a lot. While for Google, the toll is still unknown, for an online retailer of shoes, clothing and other similar items, 6pm.com, the number is easier to pinpoint. The company, affiliated with Zappos, lost $1.6 million by its own account, after the pricing engine capped plenty of the items on sale at $49.95 for several hours on Friday.
The company later reported on the incident and said it would honor all sales made at the erroneous price which will end up costing the company the sum above. The site is dedicated mostly to special offers and is targeted at brand-conscious shoppers looking for a bargain.
“[T]his morning, we made a big mistake in our pricing engine that capped everything on the site at $49.95. The mistake started at midnight and went until around 6:00 am PST. When we figured out the mistake was happening, we had to shut down the site for a bit until we got the pricing problem fixed,” Aaron Magness, director of Brand Marketing and Business Development at Zappos, the company that owns 6pm.com, wrote.
“While we’re sure this was a great deal for customers, it was inadvertent, and we took a big loss (over $1.6 million - ouch) selling so many items so far under cost. However, it was our mistake. We will be honoring all purchases that took place on 6pm.com during our mess up,” the blog post added.
The company initially said that all items were priced at a maximum of $49.99, but later clarified to say that only the items sold exclusively on 6pm.com were affected by the error. Items which also sell at Zappos kept their regular prices. Still, the company says most of its inventory was affected. In the long run, the error may end up benefiting the company more than it cost it, especially given how it handled the matter. Of course, there are those that would say this was the company’s plan all along. Either way, it looks like it worked.