If Wall Street Went Woot

You might think that the e-commerce game is already won, with Amazon.com (Nasdaq: AMZN) and eBay (Nasdaq: EBAY) sitting on the lion's share of the market. But if there's another online retailing IPO in the future I hope -- no, I pray -- that it will be Woot.com.

In fact, I think it's safe to say that Woot.com's disclosure policies would not only put Google's (Nasdaq: GOOG) "do no evil," pledge to shame, but could also revolutionize the investing world.

To see what I mean, simply pay a quick visit to Woot.com. It's an online liquidator that sells only one item at a time, sort of like a very small, slow-drip Overstock.com (Nasdaq: OSTK).

But that's not the beauty of its business. No, the real charm here is the brutally humorous honesty it displays in describing itself and its products. You think Warren Buffett tells it straight in the BerkshireHathaway (NYSE: BRKa) annual shareholder letter? He's got some competition from the folks at Woot.

Consider this snippet from the FAQ:

• Will I receive customer support like I'm used to?
  

• No. Well, not really. If you buy something you don't end up liking or you have what marketing people call "buyer's remorse," sell it on eBay. It's likely you'll make money doing this and save everyone a hassle. If the item doesn't work, find out what you're doing wrong. Yes, we know you think the item is bad, but it's probably your fault.

Or take today's special, the "Bag O' Crap." (No, I'm not making this up.) Woot sells this oft-requested item under some hilarious conditions, which you can read all about on the site itself.

The site, my friends, is a thing of beauty. Humor, honesty, and salesmanship all rolled into one. That's a refreshing change from so much of the mealy-mouthed lip-flapping on Wall Street.

This morning, I listened to yet another conference call in which a CEO used a plethora of excuses to rationalize a major earnings whiff. Sound familiar? Of course it does. Margins in the can, crummy guidance, you name it. I could be describing any number of recent meltdowns, from GM (NYSE: GM) to DHB Industries (AMEX: DHB).

Like many others, this CEO (not from GM or DHB, by the way) paid lip service to "taking responsibility" for the problems. By taking responsibility, he seems to have meant saying, "I'm sorry."

But I'm guessing his sorrow has been tempered by the millions of dollars' worth of shares he liquidated during the time he has been sitting on the knowledge of these operational screwups, which left outside shareholders like us holding . well, a bag of you-know-what.

Of course, this is part of the game we play. We try our best to judge the character of management, but sometimes we get it wrong. Very wrong. When it happens, there's nothing to do but cut your losses and try to use what you've learned to spot the next snake-oil salesman before he leaves you high, dry, and considerably poorer. Unlike the good folks at Woot.com, the people out there on the Street aren't going to always be straight with you about what's really at the bottom of that bag.

For related Foolishness:

• Four From the Dumpster
• Eyes on the Wise
• Superstars or Scoundrels?

Seth Jayson wishes he had bought the Bag from Woot instead of certain publicly traded companies. At the time of publication, he had no positions in any company mentioned here. View his stock holdings and Fool profile here . Overstock is a Motley Fool Rule Breakers pick. eBay and Amazon are Motley Fool Stock Advisor picks. Fool rules are here .