Retail History & E-commerce: Lessons for Modern Success

I’ve been a student of retailing since I was 12.

Actually, I should say I’ve been in love with retail since I was 12.

I’ve worked for and started several retail companies since then. I’ve:

• Covered retail stocks on Wall Street.
• Worked for two big department store companies.
• Founded Bookstop (which was acquired by Barnes and Noble).
• Founded Hoovers.com (which was acquired by Dun and Bradstreet).
• Served on the Board of Directors of Whole Foods Market, among others.

I’ve always loved the history of retail as well.

In this blog post, we’ll dive into some of the important moments and companies in retail history—especially as they relate to strategies for ecommerce success.

Watch or Read: You Choose

This article is a wrap-up of a longer interview BigCommerce did with Gary Hoover for the Make It Big Conference 2018. See the full video interview here, or continue reading below. 

A Brief History of Non-Store Selling

Retailing that occurs anywhere outsideof brick-and-mortar stores was called “non-store selling.” 

Non-store selling includes vending machines, door-to-door sales, mail order sales, and now online selling.

Historically, the biggest of those (by far) was mail order, although things like selling vacuum cleaners and cosmetics (Avon) door-to-door and Tupperware parties were popular as well.

So, while online selling is a relatively new concept, non-store selling has always been around.

Sears, Roebuck once had the greatest non-store selling operation in the world.

The Sears catalog, which was a powerhouse for most of the twentieth century, ceased publication the year before Amazon started.

The Sears Roebuck / Amazon Paradox

If you look at what Amazon has accomplished, their evolution has a tremendous amount of parallels with Sears Roebuck.

Sears went from selling exclusively through their mail-order catalog in the early to mid-1920s to opening stores and having over half of their sales come from stores by 1931.

Sears had a lot of debates about whether to charge higher or lower prices in their stores, because stores are more expensive in many ways.

Amazon will be having a lot of the same debates as they continue to move into physical retailing.

Whether it’s Harry & David, Pottery Barn, or Macy’s, the printed catalog business is still much bigger than most people realize.

Some of the best omnichannel marketers still aggressively use printed mail order catalogs in addition to physical stores and online commerce.

For the first 50+ years of non-store selling, the share of total retail sales occurring outside of stores didn’t change very much.

Between vending machines, door-to-door sales, mail order sales, and online sales, non-store selling only comprised about 4-5% of total U.S. retailing from the 1950s until around 2005.

Today, between 9 and 10% of total U.S. retail sales are online while around 90% still take place in physical stores.

Of course, it’s no secret that online sellers are steadily taking market share.

In fact, eMarketer predicts that online sales will be 14.6% of total retail sales by 2020, so ecommerce is clearly increasing very quickly.

My own prediction is that they won’t reach that level until the late 2020s.