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The History Of E-Commerce

Over the last 10 years, e-commerce business has absolutely exploded. The internet has given companies the ability to advertise their products and services to a global audience. This is in stark contrast to the days prior to the internet. Companies now not only have local competition but have to deal with other companies from all over the world that are targeting the same people.

The internet has completely changed the way we buy and sell things for good. We’re literally able to push a few buttons and have a box of goods arrive at our home the next day. We can book a plane ticket, buy a training program or order some food by pressing a few buttons.

The definition of e-commerce is essentially buying or selling goods over the internet. According to the Pew Internet project, 66 percent of American adults  have purchased something over the internet.

Electronic transactions between businesses were happening as far back as the 1960’s. At this time, businesses were using primitive computer networks to conduct electronic transactions. They used something called Electronic Data Interchange (EDI). With this system, companies were able to share business documents, order forms and invoices.

In 1979 the American National Standards Institute came up with a new forms of communication. It was called the ASC X12 and it became a universal standard for sharing business documents.

In the late 1980’s personal computer users were sending emails and participating in newsgroups as well as sharing documents via networks like BITNET and USENET.

In the 1990’s a researcher by the name of Tim Berners-Lee proposed a hyper-text form of communication that a user could navigate using something called a web browser (sound familiar?!). He called it the WorldWideWeb and in 1991 the National Science Foundation lifted a ban on businesses using the internet, paving the way for web-based e-commerce.

In 1993 Marc Andreesen introduced the worlds first widely distributed web browser, called Mosaic. A few short years later in 1995, the first third-party services for processing credit card information over the internet was invented. This marked the start of e-commerce business all over the world.

E-commerce giants like Amazon and eBay have set the standard for buying and selling goods online. They are outselling traditional brick and mortar businesses by a long shot and company expenses are much lower than their brick and mortar competitors due to not having to rent physical shop floor space and hire staff. The profit margins for e-commerce companies are much higher than traditional brick and mortar businesses.

This video from Shopify highlights the unexpected story of how E-Commerce started:

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