History and Evolution of E-commerce

E-commerce began before personal computers were prevalent and has grown into a multi-billion dollar industry, but where did it come from? By looking at the evolution of e-commerce, it will be easier to judge its trends for the future.

Year	Event
1984	EDI, or electronic data interchange, was standardized through ASC X12. This guaranteed that companies would be able to complete transactions with one another reliably.
1992	Compuserve offers online retail products to its customers. This gives people the first chance to buy things off their computer.
1994	Netscape arrived. Providing users a simple browser to surf the Internet and a safe online transaction technology called Secure Sockets Layer.
1995	Two of the biggest names in e-commerce are launched: Amazon.com and eBay.com.
1998	DSL, or Digital Subscriber Line, provides fast, always-on Internet service to subscribers across California. This prompts people to spend more time, and money, online.
1999	Retail spending over the Internet reaches $20 billion, according to Business.com.
2000	The U.S government extended the moratorium on Internet taxes until at least 2005.

The word eCommerce or electronic commerce was founded late in the 1970’s. The term was introduced for transactions done via computer to computer, transactions like important company data transfers, fund codes transfers, bank document transfers, purchase orders, bills or invoices; in other words all the data transfer related to commerce done electronically. E-Commerce is not just a term but a revolution for the online industry. All the tasks, letters, messages and data transferred within a flick of a second at any place no matter how far or how near. This all was impossible even for a thought or a dream, for things to be like that just a few years ago.

In the Beginning, There Was Amazon

However, that's the future. In the beginning, the Internet was characterized by slow dial-up connections and online billboards. Netscape came on the scene in 1994 with its point-and-click Web browser that opened the door to the billion-dollar revenues e-tailers enjoy today. Two of the first online purveyors were, of course, eBayAmazon.com. and

Looking at Amazon's evolution offers a pretty clear picture of the evolution of e-commerce, according to Nielsen//Netratings senior retail analyst Heather Daugherty.

"Amazon has been around since almost day one," Daugherty said. "They were the first ones to offer one-click ordering that people now expect to find. Although Amazon certainly had a lot of skepticism from the street as to when it was going to become profitable, the company kept at it."

Innovative Technology

Rich Riley, vice president and general manager of Yahoo Small Business, told the E-Commerce Times that the essence of the Internet is the establishment of a level playing field for communicating and collaborating. Riley believes the power of the Internet has enabled innovators and entrepreneurs to reach their audiences efficiently and effectively over the past decade.

"Specifically, an important milestone in the evolution of e-commerce is the development of affordable, easy-to-use e-commerce solutions that have enabled hundreds of thousands of entrepreneurs to transform their unique ideas into online successful businesses," Riley said.

One of the most important milestones was order fulfillment technologies, including shipping, according to UPS Vice President for Customer Technology Jordan Colletta. Colletta told the E-Commerce Times that online buying is mainstream today as compared to a decade ago.

"There is increased confidence in online order fulfillment, the security of personal data, and easier online return options," Colletta said. "Another critical turning point is the evolution of the online payment process. By making the payment process easier, the shipping process has become easier and more visible. Once a shipment is en route, it's trackable at all points along its journey."

Looking Ahead

What will the next 10 years bring? UPS' Colletta said we've only just begun: "During the next 10 years we anticipate seeing more ease of use, even better technology, dramatically improved visibility as well as a wider array of solutions for both online buyers and merchants."

Nielsen//Netratings' Daugherty expects to see significant changes as wireless e-commerce grows. "In 10 years, consumers ordering products online through their cell phones and PDAs will probably become commonplace," she said. "In-store pick up will allow consumers to place the order on their wireless device and get the product easily."

Gartner's Sarner said that as consumers tap into broadband, on-demand services would gain greater momentum. "If you don't want to drive to the store to pick up your favorite artist's new album, and you don't want it mailed three days later, then you can order the content online instantly," he said. "Broadband and instant access is going to change the way we think about e-commerce."