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History of E-Commerce

Most of us assume that Amazon was the first to launch an e-commerce platform on the internet, back in 1995. The first e-commerce business was actually the Boston Computer exchange in 1982 where used computers were sold online. In 1992, an e-commerce store called BookStacks Unlimited was launched to sell books, which was later taken over by Barnes & Nobles. It can be said that Amazon could really only take off after Netscape Navigator developed and distributed a user-friendly web browser with encryption certificate in 1994. 

The earliest form of e-commerce is attributed to Michael Aldrich, who in 1979 created the connection between television and telephone lines using a real-time multi-user transaction processing computer, giving birth to the word and concept of ‘teleshopping’. During the 1990s, the internet became user-friendly with the development of the first browser known as WorldWideWeb and the National Science Foundation in the US charged fees for domain names to businesses for commercial use. 

Amazon initially started selling books and then added movies. The company pioneered the concept of user reviews which was decried at the time. This however actually boosted the company’s brand image and soon, it expanded to other offerings. The online store platform leapt beyond the limitations of a physical bookstore or retail format, adding product lines as it grew. The company went public in 1997 and Jeff Bezos, the founder, was Time’s ‘Person of theYear’. 

eBay was also launched in 1995 and quickly became a popular auction platform online. An important solution for online payment processing emerged in 1998 - Paypal was founded by Max Levhin, Peter Thiel, Like Nosek and Ken Howery. It later merged in 2000 with Elon Musk’s online banking company and started to grow rapidly. eBay later bought Paypal for US$ 1.5 billion in stocks in 2020, underlining the importance of secure payment solutions for the e-commerce industry. 

In 1999, Alibaba launched itself as an online market platform with $25 million funding and quickly turned profits by 2001. The company was the first of its kind as it offered B2B, B2C and C2C markets on a single platform. Although Double Click was the first internet-based service for advertising in 1995, Google’sAdWords in 2000 allowed e-commerce sellers to show an advertisement in Google search results that corresponded to the viewer’s search, improving ad visibility. Brick and mortar retailers realized by 2000 that e-commerce could not be ignored and two of the largest retailers, Wal-Mart and Costco established their websites for online shopping. 

Shopify was launched in 2004, a platform dedicated to setting up online stores and point-of-sale systems. The company has successfully grown catering to all types of businesses, particularly small and medium retail businesses in North America. Its competitor, Bigcommerce entered the market in 2009, processing more than $25 billion in sales since then. 

During this time, Amazon was dominating the e-commerce industry in North America and spread across various regions, with the exception of China where Alibaba was the leader. Amazon introduced Amazon Prime in 2005, a revolutionary marketing tactic to offer premium services to its users with the guarantee of 2-day delivery for a flat fee. This increased its consumer base and loyalty and by which time, it had already become one of the largest companies by market capitalization on the NYSE. 

In 2011, Google introduced Google Wallet, a peer-to-peer payment system with its Android Pay and Stripe focused on payments strictly for developers. Apple Pay followed in 2014, as its store became one of the largest stores for mobile apps for the Apple ecosystem. 

e-Commerce businesses took to social media channels for advertising to their potential customer base and social media platforms looked to monetize their platforms through partner advertisements. Facebook introduced its shoppable stories in 2011 and Instagram partnered with BigCommerce to bring shoppable posts in 2017. 

As global e-Commerce sales touched US$ 3.5 trillion in sales in 2019, it has transformed not only the way consumers shop but also supply chain management and marketing for both B2B and B2C businesses.


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