The Rise of Online Retail: A Historical Perspective

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The Rise of Online Retail: A Historical Perspective
Online shopping did not start with the modern internet. Its roots go back to the late 1970s and 1980s, when early systems let people order products through connected terminals.

Online shopping did not start with the modern internet. Its roots go back to the late 1970s and 1980s, when early systems let people order products through connected terminals. In 1979, English inventor Michael Aldrich demonstrated a system for shopping from home using a television and a phone line. In the 1980s, services like CompuServe’s Electronic Mall let subscribers browse and buy products online.

The 1990s changed everything. The public internet made online stores easy to build and easy to use. Amazon started in 1995 as an online bookstore. That same year, eBay began as a site for person-to-person auctions. New security technology, including SSL encryption, made shoppers more willing to enter their card details online.

The 2000s brought marketplaces that let small sellers reach buyers worldwide. Alibaba connected manufacturers with buyers, and Etsy gave craftspeople a storefront. Selling online no longer required building your own website.

The 2010s were the decade of the phone. As smartphones spread, more shopping moved to mobile apps. Stores redesigned their sites for small screens, and one-click checkout became normal.

The COVID-19 pandemic in 2020 pushed even more shopping online. With physical stores closed or restricted, people who had never bought groceries or clothes online tried it for the first time. Many kept the habit.

The numbers show how far the shift has gone. eMarketer projected that worldwide retail e-commerce sales would reach $6.169 trillion in 2023, making up 22.3 percent of all retail sales, up from $3.351 trillion and 13.8 percent in 2019. China was the largest market by far, with just over half of worldwide online sales, and the United States was second.

The business models have multiplied too. The main ones are business-to-consumer (stores selling to shoppers), business-to-business (companies selling to companies), consumer-to-consumer (people selling to people, as on eBay), and direct-to-consumer (brands selling through their own sites instead of through retailers).

To put this history to work, read our step-by-step guide to launching an e-commerce shop and the pros and cons of starting an e-commerce business from home. Our e-commerce mastery guide covers the models in more depth.

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