The year was 1994. 60 Minutes, Home Improvement and Seinfeld ruled primetime TV. Parents were lining up to buy Mighty Morphin Power Rangers toys for their kids. And in Nashua, New Hampshire, a group of “young cyberspace entrepreneurs” launched a retail revolution when they generated the Internet’s first-ever secure transaction by selling a CD by Sting.
Fast forward twenty years. Not only is e-commerce well established, but it is a key driver in broader processes of cultural transformation that some have compared to the introduction of the printing press. Just how large is this shift? In 2015, approximately 240 million consumers browsed or made a purchase on the Internet; today, close to 70% of US adults shop online at least once a month.
How Technology Reinvented the Modern Marketplace
It’s hard to overstate the influence that all of this has had on business operations. But, at the outset, it’s worth remembering that two types of companies emerged. Those that jumped in with both feet, and those that were slower to test the water.
Since selling its first book in 1995, Amazon has been the paradigm of the former. The company rose to power as the world’s largest web-based retailer and boasts revenues of $107 billion today. On the other hand, Borders—to cite the classic example—was forced to close its doors, largely because it was “too late to the web.”
More than Books
Of course, the dramatic growth of Amazon and other online retail has not only affected booksellers. When Sports Authority recently announced that it was filing for bankruptcy and closing many of its brick-and-mortar stores, for example, many saw as the root cause Sports Authority’s failure to create in-store experiences capable of luring customers who could just as easily make purchases online.
Meanwhile, Walmart—still the planet’s largest retailer in terms of market value and revenue—is investing billions into its online operations and shutting hundreds of stores. What’s more, the company is even rumored to be on the verge of acquiring Amazon competitor Jet.com. Why? James B. Stewart, in his “Common Sense” column in The New York Times, summarized it this way: Walmart, “though it knew Internet retailing was here to stay… acted as though it hoped Amazon would just go away. Now, the magnitude of the task it faces has grown exponentially as e-commerce growth continues to surge globally.”
E-commerce is what you could properly call a “culture-shifting technology”: it changes not only the way we buy, but how companies choose to sell goods, and does so across every industry, from book publishing to commercial real estate.
It goes without saying that most of us don’t see technologies like this coming.
Anyone alive during the early days of online retail should remember the extent to which security concerns around making purchases on the web seemed, back then, like an extremely thorny challenge. It certainly wasn’t easy for the masses to accept this new way of shopping. Nor was it easy for businesses to accept the importance of having a forward-thinking online sales strategy.
The Full Force of Culture Changing Technology
That’s the thing about culture-shifting tech: we don’t always know its value until it has arrived full-force. Global business management company Accenture’s recent report on the next wave of retail technologies may have said it best:
“Technology disruptions often start small, but they can eventually gain enough power to crush the incumbents that lie in their path.”
Technology reinvented the modern marketplace, and those companies that embrace change and recognize the potential in technological advancements—however unconventional they may seem at first—thrive, while those unwilling or unable to evolve quickly find themselves left in the dust.
If you think about it, this theme is pervasive across all areas of modern business operations. Technology is constantly changing the way businesses work. Small technological events can disguise watershed moments that expand to disrupt the status quo. But leveraging these opportunities is only a matter of experimenting with the new offerings that come your way.
Remember what those young entrepreneurs set in motion, with the sale of a single Sting CD, in 1994?