Resellers have been left stranded after the crash of online advertising company PricePoint last week.
PricePoint Company Pty Ltd began trading in July 1999, offering online advertising to companies in the IT channel. Using an initial offer of two to three months free advertising, PricePoint enticed resellers to list products on its now defunct Web site (http://pricepoint.com.au).
Advertisers such as Sydney-based reseller Pioneer Computers Australia paid up to $2000 for the right to display banners and list product and company details of the PricePoint site.
Pioneer Computers Australia financial controller Molly Lai told ARN today she had been unable to contact the company after being informed via e-mail that it had ceased trading.
"Their phone and fax has been disconnected, and the Web site's links are all broken," Lai lamented.
Pioneer Computers Australia agreed to continue to advertise with PricePoint after achieving favourable results from the initial free period.
"It is always hard to measure how well advertising works," said Lai. "We had had some good feedback from the site, but now I need to know where the money has gone."
PricePoint advertisers such as Pioneer are in a precarious situation. Although they have the opportunity to petition the Supreme Court to ask for an administrator to be appointed, the legal costs involved have the potential to outstrip any gain.
In the lead-up to the company's demise, Lai was repeatedly contacted by former PricePoint general manager Jason Edwards and told of the company's successes.
"They appeared to be doing quite well because they were establishing relationships with other companies like OzEmail. Then all of a sudden we received an e-mail informing us they were closing up shop."
According to OzEmail public relations coordinator David Bathur, PricePoint approached the company late last year with a proposal to establish an Anzwers ComputerSearch advertising quadrant.
"They came to us with the idea of establishing a ComputerSearch quadrant, similar to our CarSearch and HomeSeach sites," Bathur said.
Although last week's announcement has forced the closure of the ComputerSearch site, OzEmail has not given up on the idea.
"We tailored the quadrant to PricePoint because they had been the first company to approach us with the idea of advertising computers and computer companies online. The idea is still a good one, however we have suspended it until we are approached by a company with a similar focus."
Despite repeated attempts, ARN has been unable to contact former PricePoint staff and the whereabouts of Jason Edwards remain unknown.