Retail Timeline Demographics, Technologies & Milestones

1670 - 2015

2

History of Retail

1786 1792 1834 1872 1865 1876 1883 1888

Paris:

Galleries de Bois

was first “mall”

with 120 stores.

150 malls by

1850 in Paris

London:

WH Smith

newsstand

1670

Canada:

Hudson

Bay

Company

(Fur

trading

only);

First

“major”

retailer in

NA by

1870

London:

Harrod’s

Milan:

Galleria Vittorio

Emanuele II

(oldest mall)

1850

Montgomery

Ward:

First mail

order catalog.

(Sears starts

small in 1886)

Phone

invented

Wanamaker's:

First Dept Store in USA:

1st price tags

1st in-store diner

1st Phone ‘79

1st Electric lights ’78

1st Pneumatic tubes ‘80

Cash

Register

Invented -

USA Coupons:

Invented by

Coke

Trademarks:

First “modern” laws

(France)

1857 ~1900

Brands:

Coke

Campbell's

Juicey Fruit

Aunt Jamima

Quaker Oats

Uncle Ben’s

Kellogg’s

1859

A&P:

Started as

Gillman Tea Co.;

Branded Tea ’70

1st Premiums ‘71

1st Stamps ’77

100 stores: ’81

Factories ’85

London:

(Harry Gordon)

Selfridge: opens store

with new concept:

Shop for pleasure;

1st to have a public

bathroom.

1906 1905

SMB begins to

fight back:

Massachusetts.

Becomes 1st to

tax chain store

coupons.

1908

A&P:

Builds

production

outside tea

Containers:

Production

canning &

cardboard

boxes

American

Civil War:

‘61-’65

London:

First dept stores -

Bainbridge; Kendal,

Milne & Co.,

~1910

USA:

Chains stores

begin to

standardize,

drop delivery

& credit to

reduce costs.

History of Retail

3

1912 1914 1915 1925 1924 1926 1927 1928 1911 1916 1929 1920 1932 1933 ~1940

Woolworths:

Merger of 6 dime

stores gives them

600 stores in 48

states

~250 chain brands

in USA

A&P:

1817 stores;

Experiments with

simple “Economy”

format: “Everyday

Low Price”;

600 sqft

FTC is created:

Focus on big business

A&P:

1000 “Economy” Format stores.

50% of sales.

Now nation’s largest retailer.

Begin demanding direct shipments

w/wholesaler royalties.

WWI:

1914-1918

17% inflation for food prices

Piggly Wiggly:

First self serve

grocery

A&P:

Largest retailer in world

4,588 stores

Atlantic Commission Company:

A&P created wholesale company for

fresh goods dramatically increasing

access by reducing time to market

Cellophane invented:

Transforms perishable

display & sales

Sears & Montgomery

Ward:

Begin move to Brick &

Mortar.

A&P:

13,400 stores

Move to decentralized mgt

New “big data” collection

A&P:

Move into “meat” business;

FTC investigates.

Also crowding out tobacco

retailers.

A&P:

$1B Rev; 16k stores

Ad allowances =25%

pretax profits

Commercial

Refrigeration

1922

1930

Great Depression: 1929-1939

Big Bear Market:

50k sqft mega discount

market opens (big box)

National Recovery Act:

Min mark-up rules

Store hrs rules

Unionization

(Killed in ’35)

FDA Builds

Strength:

New bill expands

powers

1938

Pre-depression:

Radio becomes common

1st yr refrigerators outsell iceboxes;

1st 10k sq ft supermarket “King

Cullen’s”

1930’s:

Cars become

common;

‘37 Shopping cart

(Piggly Wiggly);

Stores explode in size

to avoid per-store

taxes; self-serve takes

over.

Sears:

Stores sales top

catalog sales

Retail History

4

1912 1945 1957 1940 1970 1979

WWII:

1939-1945

Rationing

US Antitrust Investigations

Heavy pressure begins in ’41-’53

A&P:

4th largest US

company

Queen Elizabeth :

Insists on visiting a “supermarket”

When visiting USA

A&P:

4,351 stores.

Average supermarket (all

brands) was 15k sqft

1961 1965

Sears:

Overtakes A&P as

largest retailer.

1962

Big Boom:

Walmart

Target

K-Mart

Rite-Aid

Kohl’s

Free Markets Return

Most punitive chain

regulations/taxes gone

EAS systems become common

A&P:

Sells for $190M

1954

Mall Tax (incentive):

Policies encouraged

development of large

shopping centers.

‘56 saw first enclosed

and air conditioned

mall in MN.

1989

Walmart:

Overtakes Sears &

Kmart as largest retailer.

1959

First ATM

Ohio mall

1958

Batley’s:

First

“warehouse”

store.

Credit Cards:

Birth of Credit

Planograms :

Invented by Kmart in

early ‘70’s.

(Target used by ‘74)

Barcodes: ‘74

Cable TV:

80’s network boom

leads to 57% of

households

subscribing

by1990.

1990

Debit

Cards

1st issued

1966

1900

- High service solution sales - Daily purchases - Social Networking - People trust retailers - Big data in head of retailers

- TV and national brands reduce need to rely on retailer. - People place trust in brands. - “Supermarkets” created to provide efficient logistics. - Growth from population boom. - Customer Consumer

- Trade $ rules - Stores grow in size - Differentiation lost - Population growth stalls - Loyalty programs begin to provide revenue source.

Development Saturation

- Consolidation & globalization are only paths to growth. - Alternatives appear. - Sales/sq ft decline 17%

Decline Traditional

- Music/Books die - Big Box go online - Showrooming - Price / selection advantages begin to wane

Multi-Channel

- Online expands distribution & fast delivery - Stores go curbside - Stores get smaller - Differentiate through personalization - Consumer Customer - “Solution” sales return

Channels Blend

Barcodes begin data revolution

‘74

1945 1975 1990 2000 1955 1965 1985 1995 2005 2010 2015

Home refrigeration, cellophane

and automobiles

becomes common

~’30

Discount “Big Box”

Target Walmart K-mart RiteAid Kohl’s

‘62

Specialty The Limited ‘63

GAP ‘69

eCommerce Amazon

eBay ‘94-’95

Category

Killers Staples

OfficeMax HomeDepot

’78-’88

Club Stores Costco Sam’s

‘83 Television becomes common

~’50

Radio becomes common

A&P

has 16k stores

’30

Internet becomes common:

>50%

Mobile Rapid

adoption begins

’09

Android ’07 iPhone ’09

Social

Facebook Twitter ‘04-’06

Cloud & Analytics

Logistics

Focus

Internet becomes available

‘93

Malls become common

~’60’s

2020

Catalogs become common ~1890

Loyalty Program growth ‘85-’95

Web 3.0

Mobile Pay Google ‘11 Apple ‘14

Android ’15 CurrentC ’16

Amazon

Opens First Bookstore

‘15

- Local products and weak brands require trust in retailer.

- Products must be “sold” to retailers so logistics is cumbersome.

- Brand strength means consumers are demanding specific products.

- Birth of radio/tv feed branding

- Stores standardize to increase efficiency… but lose differentiation of store and products.

- CPG’s become the focus due to trade dollars.

- Differentiation takes the form of increased selection.

- Stores diversify to find products with margins.

Development Saturation

- The majors eliminate the locals.

- Time crunch and working moms give rise to fast food (alternatives).

Decline Traditional

- Stores scramble to build websites but fail to link POS and inventory well.

- Mobile returns power to consumers.

Multi-Channel

- Online build more distribution & even stores.

- Stores get good at online.

- Price & Selection equalize.

- Differentiation comes though service and convenience.

Channels Blend

Barcodes begin data revolution

‘74

1900 1945 1975 1990 2000 1955 1965 1985 1995 2005 2010 2015

Home refrigeration, cellophane

and automobiles

becomes common

~’30

Discount “Big Box”

Target Walmart K-mart RiteAid Kohl’s

‘62

Specialty The Limited ‘63

GAP ‘69

eCommerce Amazon

eBay ‘94-’95

Category

Killers Staples

OfficeMax HomeDepot

’78-’88

Club Stores Costco Sam’s

‘83 Television becomes common

~’50

Radio becomes common

A&P

has 16k stores

’30

Internet becomes common:

>50%

Mobile Rapid

adoption begins

’09

Android ’07 iPhone ’09

Social

Facebook Twitter ‘04-’06

Cloud & Analytics

Logistics

Focus

Internet becomes available

‘93

Malls become common

~’60’s

2020

Catalogs become common ~1890

Loyalty Program growth ‘85-’95

Web 3.0

Mobile Pay Google ‘11 Apple ‘14

Android ’15 CurrentC ’16

Amazon

Opens First Bookstore

‘15

7

- Fuels creation of largely humongous demographic - Prime spending years - Population growth fueled retail

Baby Boom - Immigration restrictions on countries outside western Europe in mid 1960’s. - Social norms dilute the “traditional American family” - Growth slows by end of century.

Demographics Shift - Major Networks

displaced by cable & satellite

- Birth of web further dilutes media power

- Web 2.0 introduces stronger influence than traditional media.

Stratification of Media

- Average performers displaced by exceptional performers via specialization

- “Average consumer” no longer targetable

- High Service returns - “Highly automated”

becomes alternative prevailing value prop.

“Average” dies

- Stores know customers.

- Products & Service highly localized.

High Service Retail

Barcodes begin data revolution

‘74

1945 1975 1990 2000 1955 1965 1985 1995 2005 2010 2015

Home refrigeration, cellophane

and automobiles

becomes common

~’30

Discount “Big Box”

Target Walmart K-mart RiteAid Kohl’s

‘62

Specialty The Limited ‘63

GAP ‘69

eCommerce Amazon

eBay ‘94-’95

Category

Killers Staples

OfficeMax HomeDepot

’78-’88

Club Stores Costco Sam’s

‘83 Television becomes common

~’50

Radio becomes common

A&P

has 16k stores

’30

Internet becomes common:

>50%

Mobile Rapid

adoption begins

’09

Android ’07 iPhone ’09

Social

Facebook Twitter ‘04-’06

Cloud & Analytics

Logistics

Focus

Internet becomes available

‘93

Malls become common

~’60’s

2020

Catalogs become common ~1890

Loyalty Program growth ‘85-’95

Web 3.0

1900

Mobile Pay Google ‘11 Apple ‘14

Android ’15 CurrentC ’16

Amazon Opens First Bookstore

‘15