Pets.com is the unofficial mascot of the dot-com bubble, which is appropriate because its actual mascot was a sock puppet, and a sock puppet is about as substantial as the company's business plan. Between 1998 and 2000, Pets.com raised over $300 million, aired a Super Bowl commercial, went public on the Nasdaq, and then ceased to exist, all in about two years.
Pets.com sold pet supplies online at a loss. Not "at a slim margin." At a loss. They paid more for the products than they charged customers, which is a business strategy in the same way that lighting money on fire is a heating strategy. The theory was that they'd build market share first and figure out profitability later. They built market share. They did not figure out profitability. "Later" arrived nine months after their IPO, in the form of a shutdown announcement.
Pets.com's sock puppet mascot became more famous than the company. It appeared on Good Morning America. It had a Macy's Thanksgiving Day Parade balloon. It was more culturally significant than anything the company actually did. After Pets.com folded, the sock puppet was sold to a different company and continued appearing in ads. The mascot outlived the company, which is either ironic or perfectly logical, since the mascot was the only part of the operation that worked.
Pets.com failed because investors valued growth over sustainability, which was the defining error of the dot-com era and also the defining error of right now, depending on which year you're reading this. The lesson — that revenue is not profit and that market share is not a business plan — has been learned and forgotten by approximately one generation of investors per decade since.