Despite the fact that eCommerce has become a way of life in the last two decades, it is harder than it might seem to choose a birthdate for the shopping method that has defined 21st-century retail and payments. One could, for example, choose July 5, 1994, the day Amazon was founded. That is why Prime Day is in July every year, to celebrate the day Amazon opened for business – and opened the web for commerce.
Fans of English inventor Michael Aldrich say the mantle goes to him, since in 1979 he connected a modified domestic television via a telephone line to a real-time, multi-user transaction processing computer, thus formally inventing online shopping. It never really caught on, and no goods were ever actually bought this way.
Others would say even that isn’t quite right, and that the credit belongs to highly educated stoners. The first eCommerce transaction took place in 1972, when Stanford students used ARPAnet to sell marijuana to some MIT students.
And while all of these entries – with the possible exception of the ARPAnet misuse – deserve their place in the official telling of eCommerce’s heroic journey from obscurity to becoming the driving influence of retail in the digital age, we think another firm at least deserves consideration for the crown.
They were not technologists, proto-internet engineers or Amazonians.
No, the first the eCommerce innovator was a Canadian department store owner with a dream of bringing push-button commerce to the masses.
In the year 1950.
The Rise of the Vis-O-Matic
When Canadian department store A.J. Freiman announced in May 1950 that is was going to bring its “push button” vision to its Pembroke, Canada location, the idea wasn’t exactly met with wild enthusiasm. Judging by contemporary news reports, most people were baffled, and some were terrified. The situation was exacerbated by the fact that A.J. Freiman offered almost no explanation for what that meant, only noting that the new and improved shopping experience would be called the “Vis-O-Matic.”
In fairness, back in 1950, adding “omatic” to anything made it sound thrilling. Color TV was still three years away from release, and people had a lower threshold for excitement.
But after a month of building hype, the world saw the offering: stores built with televisions instead of inventory. Customers would sit at the screen, pick out what they want and then leave. The store would then ship the orders directly to consumers’ homes.
Lawrence Freiman, head of the firm, reportedly came up with the idea in 1945 as a better way to serve small-town retail environments. Filling up big urban locations with lots of shopover and tourists was great, but it wasn’t profitable to ship its extensive catalog all over Canada to towns that didn’t have the population to support them. But as the post-war boom was spinning into full gear, Freiman wasn’t about to take a pass on the revenue to be generated from those smaller communities.
What he discovered instead was that with small, visual stores, shoppers could view the latest and greatest, and pick the inventory they actually wanted. The rest of it could stay behind in Ottawa, where the department store was based. In all, 3,750 products were digitized and available for shipment to Pembroke.
Once the order was made, customers handed off their order slips to a “sales counselor” who used an early version of the fax machine to send the orders instantly back to Ottawa.
“The goods are delivered the next day by mail or express,” according to A.J. Freiman’s official advertising of the program.
“It is the introduction of shopping through a completely visual process,” Women’s Wear Daily wrote at the time.
And, according to Freiman, per the Smithsonian, the early days revealed that customers liked the method quite a lot: “Our first experiences indicate there is no question but that we can sell anything by this method.”
Women’s clothing – especially dresses, sportswear and shoes – were the biggest seller on the Vis-O-Matic screens, Freiman told reporters at the time, with children’s clothing following closely behind.
“Business has also been done at the Pembroke store on such items as major appliances, radios, linoleum,” he added.
At first, the Vis-O-Matic generated a lot of buzz, and a lot of orders from retailers looking to capture the magic.
And yet, despite making a big splash showing early signs of success, the Vis-O-Matic faded into historical obscurity.
Shipping Costs: Ever a Problem for Profitability
The trouble for A.J. Freiman wasn’t that the machines weren’t popular, or that people didn’t shop in the stores. The trouble was the shipping: The promise to get the goods ordered in one day to a customer’s home was a very expensive one to keep. It was a fact of which Freiman was aware – even when he was actively pitching the idea, he always noted that the cost of shipping individual orders nearly 100 miles from Ottawa to Pembroke was far too massive compared to profits.
Some problems, it seems, are classics.
But Freiman believed this was ultimately a solvable issue, even if they lost money on remote retail at first. The concept, he believed, could be a profitable move if customers all over Canada were placing remote orders and could build a customized shipping and logistics network that would work in tandem with the Vis-O-Matic visually based ordering system.
Hmmm, we could swear we’ve heard a plan like that before…
But A.J. Freiman was never able to execute that plan. The Vis-O-Matic units were somewhat difficult and time-consuming to build and transport to the more remote areas that needed them, and so their progress never moved much beyond that initial Pembroke location. In 1971, Hudson Bay bought A.J. Freiman, and quietly killed the only existing Vis-O-Matic store, which was dubbed an interesting experiment in a form of commerce that obviously had no future.
So, does the Vis-O-Matic deserve the eCommerce crown? Hard to say. On one hand, it was a very small, experimental undertaking that was only used by rural Canadians in the 50s and 60s. It wasn’t all that influential.
On the other hand, when the Vis-O-Matic hit the market, computers were less than a decade old, the internet wasn’t even a concept in the mind of sci-fi writers and Amazon was 45 years away from shipping its first book. Despite all of that, the Vis-O-Matic more or less identified the major problem – and potential solution – that eCommerce retailers have spent the last two decades grappling with.
It may not mean they earned the crown, by it surely merits an honorable mention on the list of digital commerce inventors.
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