E-Commerce: Back to the Future

January 23, 2015 BY Charles Fallon

20150123 - E-Commerce back to the futureBecause e-commerce is a relatively new retail horizon, often business leaders and entrepreneurs think that every aspect of an e-commerce company has to be cutting edge, awash in technical wizardry.  It’s a dangerous notion – fatal in some cases like Webvan – that can lead companies down a path of wasting precious capital on operations gadgetry and gizmos.

So here are three little bits of history.   They do not offer tips on how to run an e-commerce company but they will put your operations into perspective and give truth to the cliché that the more things change, the more they stay the same.

Tiffany’s Blue Book or the Original Home Delivery

Tiffany’s Blue Book was the first mail order catalog published in the United States – a kind of business that exploded with Homestead Act of 1862 and America’s westward expansion.  Mail order retailing involved shipping out catalogs of a merchant’s wares (it was a cheap thing to do because the U.S. Government allowed merchants to classify catalogs as the “dissemination of knowledge”).  Customers placed orders via mail and, thanks to railways and the postal service, eventually received their goods.  Today’s e-commerce businesses are part of a long tradition that started more than 100 years ago.  When L.L. Bean added llbean.com, they didn’t need to re-invent their supply chain.

Gray’s General Store or Before They Invented Supermarkets

Gray’s General Store was founded in 1788 in Adamsville, Rhode Island.  It is credited as being the longest-running general store in the United States.  Before Piggly Wiggly showed up in 1916, shoppers never served themselves.  They handed (or dictated) their list of needs to store clerks who fetched the items for them.  In other words:  store clerks were picking individual orders.  Often times, this included weighing and packaging order lines from bulk goods.  The self-serve supermarket changed all this because it shifted the labor burden from store clerks to shoppers themselves.  The labor intensity of picking orders for e-commerce operations are not a brave, new world.  Instead, they are a return to practices from a long-ago time.

Lombardi’s Pizza or Overstating the Omnichannel Revolution

In 1905, Lombardi’s Pizza in New York City became America’s first pizzeria.  Still operating today – (there was a 10 year hiatus in the 80s) – it sells its pizzas in its restaurant and through local delivery (by bike).  So, like many local pizza joints, Lombardi’s has been doing omnichannel sales for decades.  And it didn’t need Deloitte to map out its omnichannel strategy and no scholarly business journal ever spent a second thinking through this revolution in business practices.  Swap a phone for a mouse and keyboard and well, a veritable revolution has taken place!

Three bits of history with an underlying theme:  much of what makes an e-commerce company successful (i.e., profitable unless you're Amazon) is not new.  While we all strive for innovation where we can, folks shouldn’t get caught up thinking that innovation is a necessary condition for winning in the dotcom world.  If anything, being overly focused on innovating every last square inch of your business might end up ruining it instead.