The Evolution of Ecommerce – A Brief Overview
Ecommerce is something we encounter every day, both in business and in normal, day-to-day life. But it wasn’t always like this.
22 years ago, Amazon has sold its first book online. So, this is not ancient history, as it happened in the mid ’90s. And today, you can buy anything there is to sell over the Internet. So how did something grew up to become so vast and so significant in a relatively short period of time?
That is the question we wanted to answer. In this article we will provide you with all the information and we will explain how that happened. After reading this article you will have much more appreciation of things we usually take for granted in modern day life, things like ecommerce.
The Timeline of eCommerce
In 1991 the World Wide Web was created. It was only natural that people will try to find a way to exploit this new invention, mainly in terms of generating income. As usual in life, wishes are one thing, but reality is something completely different. There were many things in the way of bright ideas, as the whole Internet of that era was an unknown territory that was waiting to be charted.
People tried to access the Internet in different ways, but nothing really worked. Not until 1994. There came a breakthrough; Netscape launched its browser, Navigator. This was vital, as this was the first browser to be widely and globally used. That same year, the first company that implemented an online business innovation was Pizza Hut. They offered online ordering on their website.
But the year when real ecommerce was born is 1995. In this year, eBay was founded and Amazon sold and shipped its first book. But, nobody even hoped that the Internet, let alone ecommerce, will grow nearly as much as it did in the past 20 years.
But it grew, and it grew fast. In 1996 already more than 40 million people had Internet access, and online sales went over one billion dollars that year!
The trend not only continued, but rose significantly. New platforms emerged, like PayPal, speeding up transactions and changing the way how people make payments completely.
And in 2000, only 4 short years after the first online purchase, online shopping totals went over 25 million dollars.
Later, more services emerged, such as Apple iTunes, which was the first major digital music store.
In 2006, 10 years after the first online purchase, Facebook started selling advertisements and changing the marketing world completely.
Shortly after, in 2008, mobile purchases became available for the first time. Fast forward seven years, and you will see that in 2015, 30% of all online purchases were made from a mobile device.
In 2012, online B2C sales went over 1 trillion dollars. In 2015, only Americans spent over 341 billion dollars online. But this does not mean that only the ecommerce revenue rose. Ecommerce share in total retail sales in the USA rose from 4.6% in 2010 to 7.5% in 2015. And it continues to rise.
USA data shows that almost 80% of adults have made a purchase online. The product category that customers buy the most is computers and consumer electronics. 22% of all sales fall under this category. The second category behind electronics is clothing with a total share of 17.2%. Books, music and videos are all around 10% of the total market share.
Today, there are more than 800,000 online stores.
eCommerce Pluses and Minuses
One thing that ecommerce lacks, and something it will probably lack forever is missing that physical feel. Pictures, sounds, and videos are one thing, but holding the item with your own ten fingers is something completely different. For some item categories, like computers, this is irrelevant (this is why it is the most sold category), but for other it can be a problem. As long as you need generic items, ecommerce is great, but if you need to find something custom, it can be tricky. If your foot is too wide, and you know that you need to try 30 different pairs in the store before finding the one that fits, you should forget about buying shoes online.
You can always return your item, that’s true, but it takes time. Shipping is also a downside, as most likely you will buy items across the globe, and shipping and import taxes can be pricey. And there were some older concerns, like identity theft (since you use credit cards for shopping online), but these are less relevant today, since Internet security has drastically improved.
But buying online has its benefits too. You can do it anywhere, browsing from your phone. This means you don’t have to dedicate time for actual shopping, you can do it along the way. By buying online, you are able to get items that are not available in your local stores. And you can compare prices from different stores in no time at all.
Ecommerce also saves you money. You can create a wishlist with the items you want, and wait for the prices to get better. Many stores offer a notification system and will let you know when your item goes on sale. Many regular stores provide email and SMS notifications, but it’s a much bigger hassle, since you have to go to the store to buy it. With eCommerce and proper money management, you can really save a lot.
Also, there are things you want to buy without others knowing. Shopping can be done discretely and anonymously online.
Looking Ahead – The Future of eCommerce
The short timeline above shows how fast ecommerce grew. But this does not mean that it will stop growing, on the contrary. Each day brings something new in the world of technology and with those inventions business entrepreneurs keep inventing new ways to sell their products and satisfy their customers. We can expect that more and more businesses will become completely online in the future. Even today some things are done almost entirely online. Try to remember the last time you ordered pizza by phone? The smartphone app makes it so much easier. Even taxis are becoming a surplus when you have Uber.
Many people think that online shopping kills small manufacturers, but that is not true. Smart sellers find new ways to fill in the blanks. Most ecommerce customers complain that their online purchase experience is too generic and they want their sellers to offer something more personalized and customizable. This is something that is easier for smaller retailers, as they are naturally closer to customers than big brands. For example, today, it is even possible to buy a custom, tailor made suit online. The only thing you need to do is to measure yourself and choose a design. And, it will cost you much, much less than a classic branded suit. This is the true power of ecommerce unleashed, as tailor made clothes were something only the richest were able to afford. And now it is widely available.
Ecommerce allows anyone to compete, as long as they have quality to offer. If your product is good and you make a decent website using a website builder or WordPress, it will sell. People will always want the best value for their money, and they will find a way to get it. So if you have a quality product, you only need a proper website and some marketing to get you going. After that, only the sky is the limit.
Ecommerce is improving our lives rapidly, in many ways, offering us stuff from around the globe, for affordable prices too. With modern smartphones, we all have the biggest store in the world in our pocket, available at any time.
Ecommerce offers unlimited options. The only problem is; money is very limited and you can’t buy everything. But, the problem of choice is a good problem to have, so we should be grateful that we live in the time of ecommerce.
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