The history of eCommerce is filled with interesting facts, stories, statistics, notable individuals, and companies that have shaped the world as we know it today. This article aims to summarize the evolution of eCommerce over the last 50 years.
eCommerce, or electronic commerce, refers to the buying and selling of products or services over the Internet. It encompasses all digital commercial transactions, whether they occur between businesses (B2B), between businesses and consumers (B2C), or between consumers themselves (C2C).
More broadly, eCommerce also includes transactions that blend physical and digital elements, often referred to as hybrid commerce or omnichannel. These transactions involve interactions in both digital and physical realms, such as click-and-collect (where a customer buys a product online and picks it up in a physical store) or O2O commerce (online to offline) (where digital platforms encourage visits to physical stores, for instance, through exclusive online promotions redeemable in-store).
This hybrid approach enables businesses to capitalize on the benefits of both worlds, providing the convenience of online shopping along with the tactile experience of physical stores.
Before eCommerce transformed traditional distribution, catalogue sales had already begun this transformation. For the first time, it was possible to buy products without seeing, touching, or trying them, allowing sales in remote areas where distances and access seemed insurmountable.
Catalogue sales (which lasted for decades, as seen with companies like Venca) enabled companies to reach a broader audience, offering a variety of products not available in local shops. Consumers could choose what they wanted from the comfort of their homes, marking a significant shift in shopping habits.
However, the foundations of global commerce were laid in the 1960s. Modern credit cards were already in the market, and life was poised to change dramatically with the advent of the Internet. The creation of the first network of connected computers (ARPANET, 1969) was a pivotal step towards the development of Tim Berners-Lee’s World Wide Web (1989), which revolutionized how we buy, sell, and communicate.
The 1970s and 1980s were decades of significant technological advancements, setting the stage for eCommerce. A key milestone was achieved by Michael Aldrich in 1979, who connected a modified television to a computer using a standard telephone line. This system, known as teleshopping, allowed data transmission between consumers and businesses via the telephone network, a groundbreaking concept at the time. The television, adapted to receive these signals, became a medium for interacting with a computer system, representing a crucial advancement in information processing and display.
The first operations, in B2B mode, occurred in 1981, as recorded in the Aldrich Archive. Initially, the system was designed for automating business processes between companies and governments, not for end consumers. The B2B system allowed companies to connect through terminals and conduct remote business transactions. This type of solution was first implemented in large companies and governmental organizations to improve efficiency in supply chain management and transactions between major suppliers and buyers.
Years later, in 1984, Jane Snowball, a 72-year-old woman, conducted the first recorded online B2C purchase. **Jane Snowball**, a 72-year-old woman, was the first person to make a recorded B2C online purchase. **Mrs. Snowball** was chosen to test the teleshopping system because she needed a convenient way to shop from home after breaking her hip. She used a system developed locally in Gateshead, England, as part of a social assistance project. This project employed Videotex technology, which was based on Aldrich’s innovations. It allowed users to access databases and services through telephone lines using devices like televisions or specific terminals. The system worked through a telephone connection or network and enabled users to interact with content displayed on a screen, usually with a keyboard.
She was given a standard TV that had been modified with special chips and a remote control with an extra button labeled “phone.” By pressing this button, a directory of retailers appeared on her TV screen in a format similar to teletext. From there, Snowball could choose the retailer and products she wanted to buy.
The system featured a list of about one thousand items from Tesco supermarket. Jane Snowball selected products directly on her TV, and since the web didn’t exist at that time, her order was transmitted via her telephone line to the supermarket. The products were packaged and delivered to her home. Upon receiving her order, Snowball paid in cash because credit cards were not yet widely used for such transactions. Using this system, Jane ordered items like margarine, eggs, and cereals, marking one of the earliest examples of home shopping that would eventually evolve into modern eCommerce.
This experiment was a significant milestone in the history of technology, laying the foundation for future developments in the interconnection of electronic devices. The idea of using a television as a screen for a computer was a groundbreaking concept that would eventually become a common practice in the era of modern computing.
From that point on, the concept of electronic commerce began to take shape. In the 1980s, companies started exploring the possibility of selling products and services through computer networks. However, it was in the 1990s that eCommerce truly took off. The introduction of web browsers such as Mosaic and Netscape made Internet navigation easier, allowing users to access information and make purchases more conveniently.
The 1990s were a crucial period for electronic commerce, characterized by rapid growth and numerous launches. In 1994, the first secure online transaction took place, marking an important milestone in consumer trust. In that year, an entrepreneur named Dan Kohn sold the Sting album, “Ten Summoner’s Tales,” through his platform called NetMarket. The buyer made the payment using an encryption system to protect their credit card information. This moment is considered the first example of an eCommerce transaction with all the elements we know today: a product, an electronic payment, and data security.
Just a year later, in 1995, two eCommerce giants were founded that still exist today, albeit with different trajectories: eBay and Amazon, which transformed this channel into a massive sales option. Although there were previous attempts at online sales, these pioneers solidified the first credit card payment systems and third-party platforms.
Both companies emerged during the dot-com bubble, a period of great enthusiasm in the technology sector from 1997 to 2000. During this time, there was a boom in the creation of Internet-related companies, spurred by the growing popularity of the web and massive investment in new technologies. Many startups saw the opportunity to capitalize on Internet access and business digitization, leading to the emergence of numerous online platforms and services.
However, the dot-com bubble was also marked by excessive speculation and the eventual collapse of many of these companies, which failed to sustain their business models. Despite this, eBay and Amazon not only survived but thrived, becoming leading players in the eCommerce industry.
While the dot-com bubble posed challenges, eBay and Amazon not only survived but flourished, ultimately becoming leading forces in the global eCommerce landscape.
Founded by Pierre Omidyar in 1995, eBay began as a platform for online auctions where users could directly buy and sell items. Originally named Auction Web, the idea of creating a virtual marketplace for easy and accessible goods exchange quickly gained popularity, resulting in rapid platform growth. eBay not only enabled product transactions but also built a user community that fostered trust through ratings and feedback.
Auction Web launched with the sale of a laser pointer. It soon rebranded to eBay, revolutionizing online commerce by connecting buyers and sellers worldwide through its auction model.
Meanwhile, Amazon, founded by Jeff Bezos in 1994, started as an online bookstore called Cadabra. It quickly expanded to offer a diverse range of products, from electronics to clothing and food. Bezos envisioned Amazon as “the everything store,” focusing on customer experience, innovation, and efficient logistics, which propelled Amazon to become a major eCommerce powerhouse. Services like Amazon Prime, offering quick shipping and exclusive content, have reshaped consumer perceptions and engagement with online shopping.
The 2000s witnessed a surge in eCommerce, driven by internet expansion and growing consumer trust in online shopping. Initially, eCommerce was mostly confined to digital products like books and music. However, by the end of the decade, advancements in secure platforms and faster internet speeds broadened the range of products available online.
A key development was the advent of secure payment systems, such as PayPal, which lowered barriers for buyers, facilitating international purchases of physical goods. This innovation also advanced the globalization of eCommerce, enabling companies to enter new markets and expand swiftly.
In the 2000s, Amazon and Alibaba emerged as dominant forces in eCommerce, setting the stage to become pivotal industry players. As mentioned before, Amazon evolved into a comprehensive platform where consumers could purchase nearly anything, thanks in part to its emphasis on customer experience, offering speedy delivery, competitive pricing, and effective customer service.
Conversely, Alibaba became a leader in Asian eCommerce, linking manufacturers and distributors with global buyers through Alibaba.com. This B2B marketplace played a vital role in the expansion of global trade, particularly between China and the West. Furthermore, platforms like Taobao (C2C) and Tmall (B2C) helped Alibaba strengthen its foothold in both local and international markets. Today, Alibaba is a significant player in the B2C marketplace arena, with platforms like Aliexpress, as well as local initiatives like Miravia in Spain.
The 2000s saw eCommerce not only grow in size but also diversify in business models. Initially centered on the B2C (Business to Consumer) model, where companies sold directly to consumers, the decade witnessed the rise of other models like B2B (Business to Business) and C2C (Consumer to Consumer).
Notably, the C2C model reached its peak with platforms like eBay and Craigslist, enabling consumers to sell directly to each other. This model encouraged a culture of recycling and reusing products, a trend that continues to grow in recent decades.
From 2000 to 2010, electronic commerce underwent a major transformation thanks to the advent of smartphones and advancements in mobile technology. This mobile era introduced groundbreaking changes in consumer shopping behavior, leading to the emergence of mCommerce and the creation of shopping apps that dramatically improved user experiences.
In the late 2000s, the introduction of smartphones enabled consumers to shop from virtually anywhere, sparking a rising demand for quicker shopping experiences and encouraging impulse purchases.
The launch of the iPhone in 2007 was a pivotal moment in the evolution of eCommerce, providing features beyond just calls and texts, and allowing users to access the internet conveniently from their hands.
The impact of smartphones was significant for several reasons. Firstly, they expanded internet access to a much broader audience, as people could connect without needing a computer or fixed location. Additionally, companies started developing responsive websites and mobile apps, specifically designed for smaller screens and touch navigation, resulting in more intuitive shopping experiences with simpler interfaces that improved conversion rates and decreased cart abandonment.
Another major advancement brought by smartphones was geolocation, which allowed brands to offer personalized deals and services based on the user’s location. This enhanced the relevance of promotions, boosted conversion rates, and increased customer loyalty.
Moreover, the rise of mobile payments was also crucial for the growth of mCommerce. Solutions like Apple Pay and Google Wallet gained traction towards the decade’s end, providing users with a quick and secure way to finalize purchases from their mobile devices.
As smartphones grew in popularity, shopping apps became essential for brands seeking to improve the user experience. Through these apps, businesses could offer an optimized interface with custom features, push notifications, and easy access to exclusive deals.
Platforms such as Amazon and eBay were early adopters in developing mobile apps, enabling users to shop quickly and effectively. Shopping apps offered advantages over mobile websites, like saving payment information, managing wish lists, and sending personalized notifications that aligned with user interests. Additionally, these apps facilitated the creation of loyalty programs and rewards that enhanced customer retention. Users could benefit from exclusive discounts, earn points on purchases, and receive tailored recommendations, strengthening the bonds between brands and their customers.
Between 2010 and 2020, eCommerce experienced rapid global growth, driven by increased internet access, widespread mobile device adoption, and improved logistics networks. Major platforms like Amazon, Alibaba, and eBay cemented their positions as industry leaders, with many traditional companies also beginning their digital journey.
This decade saw a significant shift in consumer shopping habits, favoring the ease of online shopping from home, resulting in a substantial increase in online sales. By 2020, eCommerce accounted for 19% of total global retail sales, spurred, as we’ll explore, by the COVID-19 pandemic, which accelerated digital transformation across many businesses.
During this period, social media played a vital role in the progression of eCommerce. Platforms like Facebook, Instagram, and later TikTok, evolved from mere social interaction spaces to direct sales channels. The rise of social commerce became prominent, allowing users to not only discover products through ads or influencers but also make purchases directly through social media platforms.
With the advent of social media, Instagram introduced its Instagram Shopping feature, enabling brands to tag products in their posts, while Facebook launched Facebook Marketplace. This approach has made it easier to blend shopping experiences with social interactions, offering businesses new opportunities to reach their audiences more directly and personally.
Influencer marketing has also become an essential tool for building trust and boosting conversions within social commerce environments.
In this decade, emerging markets such as Latin America, Asia, and Africa have become key regions for eCommerce growth. The rapid increase in smartphone and internet penetration has allowed more people to access online services, creating new opportunities for e-commerce businesses.
During this period, technological innovation has been a crucial factor in the evolution of eCommerce. Technologies such as artificial intelligence (AI), big data, and augmented reality (AR) have enhanced user experiences and optimized operations.
Between 2020 and 2024, eCommerce has continued to grow rapidly, driven by significant changes in consumer habits and technological advancements. Here are the key points that have marked this evolution.
In recent years, eCommerce has experienced steady growth, especially in the mobile sector, with more consumers shopping from their smartphones. A notable trend is the preference for more personalized shopping experiences, driven by the use of artificial intelligence (AI) and big data, which enable product recommendations tailored to the user profile. Additionally, fast and flexible delivery options, such as same-day delivery or “click and collect,” have become standard for consumers, raising expectations for eCommerce logistics.
The rise of subscription services and installment payment platforms has also gained traction, facilitating recurring purchases and improving accessibility for a wide range of consumers.
The COVID-19 pandemic was a key catalyst for the acceleration of eCommerce, similar to the global adoption of the internet. By 2000, the number of internet users worldwide was only 396 million, a figure that has grown exponentially through 2024, as shown in the following chart:
The Internet Worldwide. By the year 2000, there were only 396 million internet users globally, a number that grew significantly by 2024, as illustrated in the following graph:
During the lockdown period, millions worldwide turned to online shopping due to restrictions on physical stores. Additionally, industries like food and online entertainment experienced a surge in demand, which accelerated digital adoption in sectors that were previously less inclined toward eCommerce.
This expansion also took place in emerging markets such as Latin America and Africa, where digital commerce was less prevalent before the pandemic. Platforms like Mercado Libre in Latin America and Jumia in Africa saw significant growth, adapting to the increased demand for online services and products.
The percentage of global consumers who shop online weekly is currently at 56.1%. Thailand remains the leader as the country with the most online shoppers who make weekly purchases, with a rate of 66.9%, slightly up from 66.8% the previous year. Following Thailand is South Korea, holding steady with 65.8%, and Turkey in third place at 64.7%.
From 2020 to 2024, we have observed the emergence of niche marketplaces that offer highly specialized products, such as sustainable fashion, eco-friendly technology, or handcrafted goods. Additionally, more robust businesses that transitioned from eCommerce to marketplaces have also gained traction. These marketplaces are competing with industry giants like Amazon, Aliexpress, and Zalando, which poses a significant challenge for medium-sized businesses.
Moreover, in recent years, new Chinese-origin players such as Temu and Shein, or even Hacoo, have successfully expanded beyond their borders, becoming major influencers in the fashion sector.
In addition, pure players, companies that operate exclusively online, have solidified their positions. Companies like ASOS and Zalando have expanded by providing optimized online shopping experiences, eliminating the need for physical stores. Their focus on specialization and mastering the customer experience has enabled them to thrive in an increasingly competitive market.
The future of eCommerce is being shaped by emerging technologies that are changing the way consumers shop:
Image credit: Flux Schnell
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