‘… WINNING THE GLOBAL E-COMMERCE BOOM’ part six
by Porter Erisman
Published by St. Martin’s Press
eBook ISBN: 9781250088680
Copyright (c) 2017 by Porter Erisman
“Told you so,” says John. “It’ll only take a few weeks to get here, and I’ve got a harness I can lend you in the meantime. And if you don’t like the new one, you can send it back for a full refund.”
“But do you trust these fellas with your money?” you ask. “There are a lot of hucksters out there.”
“I pay it cash on delivery. When you get to the American Express office, take a look at the harness. If you don’t like it, you can send it back. Satisfaction guaranteed.”
In fact, the wife and I are putting in an order next week. If you’d like, you can put your order in with ours.”
You take John up on his offer and put in an order. And because you are saving money, you decide to add a couple items—a new hand mirror for your wife and a harmonica for your son.
“Keep the catalog,” John says. “I’ll get a new one with the order.” You hear old Lee’s footsteps and quickly slip the catalog into your satchel. “Let’s just keep this between us for now,” John says. “I don’t want old Lee gettin’ upset. I have to see him at church every Sunday.”
Lee comes back into the room with the harness. “I found what you’re looking for,” Lee announces. “Why don’t you come have a look?”
“Thanks, Lee. It looks nice. But I think I may have found a solution. What do I owe you for the lemonade?”
“All right, sir, as you wish,” Lee says with a puzzled look. “Don’t worry—the lemonade is on me.”
You slap a penny on the counter and shake Lee’s hand. He deserves something for the fresh lemonade, after all. “Thanks, Lee. Always a pleasure.”
You walk out the swinging doors, untie your horse, and climb into the saddle. As you ride away, Lee scratches his head and turns to his wife. “He’s a nice fellow. But that sure is a long way to ride for some lemonade.”
THE EVOLUTION OF RETAIL
When we think of the first e-commerce innovators, several names come to mind. Amazon’s Jeff Bezos. EBay’s Pierre Omidyar. Even my former boss at Alibaba, Jack Ma. But few people would put Aaron Montgomery Ward on their list. In fact, what I remember of Montgomery Ward from my childhood is a crumbling old department store in a nearby shopping mall.
But Montgomery Ward was the Jeff Bezos of his time. If a TechCrunch Disrupt conference had been held in 1875, Montgomery Ward would surely have been the headliner. His business model was both innovative and disruptive, changing the way people shopped in the American West.
In 1872, the year Montgomery Ward was founded, the United States was the great emerging market of the world. The Civil War was nearly seven years in the past, and the peace accelerated a huge migration from East to West. The original spark for this migration was the Homestead Act, which Lincoln signed in 1862, thirteen months after the start of the Civil War, to encourage western migration by offering settlers 160 acres of public land. To earn the land homesteaders had to pay a nominal fee and live on the property for five years. After that it was theirs.
Before the Homestead Act, only 14 percent of Americans lived west of the Mississippi River. By 1890 that figure had nearly doubled. About 70 percent of the population still lived in rural areas, but the westward expansion helped make Chicago a major hub for the growing railway system. And where the railroads didn’t go, express delivery services such as Wells Fargo and American Express served the western settlements with horse-drawn wagons.
The settlement of the West created an agricultural boom as the value of agricultural products tripled during the last five decades of the nineteenth century. During this period manufacturing became increasingly important, and by 1900 the United States led the world in manufacturing, producing twice as much as England and half of all of Europe combined. Although the diversity and availability of products quickly increased in the coastal cities, such goods had not yet found their way to the homes of customers scattered throughout the American West.
Residents of rural areas typically shopped at the local general store, which played an important part in the social lives of its customers, who had few other gathering spots. The general store was where the shopkeeper dispensed the latest crop intelligence and gossip about neighbors, and men might throw back some whiskey while complaining about the latest goings-on in Washington.
Yet farmers often resented store owners, who captured sizable margins on the products they sold. At the general store flour might be twice the wholesale price. The markup on shoes was 60 to 200 percent. Wool suits cost three times the wholesale price. And if customers purchased products on credit, they typically paid a punishing interest rate of 12.5 percent.
This excerpt ends on page 15 of the hardcover edition.”
An insightful, practical guide to e-commerce in emerging markets–and how to profit from their explosive boom.
From China to India to Nigeria, e-commerce is entering a golden era in countries that were long left out of the e-commerce gold rush experienced in the West. If the story of the first twenty years of e-commerce’s growth was set in developed markets, the story of the next twenty years will be set in emerging ones. The rise of e-commerce in emerging markets is being driven by three major trends: widespread internet adoption, a rising middle class, and, most importantly, innovative new business models that serve the needs of local customers better than the models used by western e-commerce giants.
Six Billion Shoppers takes readers on an exciting and colorful journey around the world to visit the next e-commerce mega markets and explore how a new e-commerce boom is opening opportunities for entrepreneurs and global brands alike. Traveling through Nigeria, China, India, Southeast Asia, and Latin America, Porter Erisman addresses e-commerce across these new markets and what it means for western brands. He argues that e-commerce in developing countries is revolutionary and will play a much larger role in emerging markets than in the West. With e-commerce in emerging markets entering a rapid period of expansion, Six Billion Shoppers explains how to seize the massive opportunity created by emerging market consumers and provides practical advice on how to ride this new business trend.
From 2000-2008, Porter Erisman worked as a Vice-President at Alibaba Group, joining the company just as it moved out of founder Jack Ma’s apartment. He is the writer/director of Crocodile in the Yangtze: The Alibaba Story, an award-winning documentary about the rise of Alibaba and its famous founder, Jack Ma. Erisman is also the bestselling author of Alibaba’s World: How a Remarkable Chinese Company is Changing the Face of Global Business. An expert on e-commerce in emerging markets, he has consulted to e-commerce companies in Africa, Asia, and Latin America and has spoken at high-profile industry events in over 30 countries.