American Business

American Business

American business history is a history of business, entrepreneurship, and corporations, together with responses by consumers, critics, and government, in the United States from colonial times to the present. In broader context, it is a major part of the Economic history of the United States, but focuses on specific business enterprises. The big city department store Edit Main article: Department store In every large city department stores appeared in the mid-19th century aimed at affluent women customers. They followed a model that originated in London and Paris, but all the major department stores quickly copied new features from each other.[53] In New York City in 1862, Alexander Turney Stewart built a store on a full city block with eight floors and nineteen departments of dress goods and furnishing materials, carpets, glass and china, toys and sports equipment, ranged around a central glass-covered court. His innovations included buying from manufacturers for cash and in large quantities, keeping his markup small and prices low, truthful presentation of merchandise, the one-price policy (so there was no haggling), simple merchandise returns and cash refund policy, selling for cash and not credit, buyers who searched worldwide for quality merchandise, departmentalization, vertical and horizontal integration, volume sales, and free services for customers such as waiting rooms and free delivery of purchases. Beauty and elegance were central themes, the department stores hired attractive upscale young women to deal with the customers, while the back rooms the men made practically all the decisions.Self-service Edit Until now retail stores involved customers giving orders to clerks who assembled merchandise. Self-service, whereby the customer roamed the aisles and picked out what she wanted, was innovation in the early 20th century that made possible supermarket grocery chains and other forms of chain stores. Clarence Saunders (1881-1953) launched the self-service revolution with his Piggly Wiggly store in Memphis, Tennessee in 1916.[57] The store depended on personal shopping baskets, branded products, and checkouts at the front. A critical ingredient was the educated consumer who had familiarized herself with brand-name products and prices. By 1922, Piggly Wiggly had opened 1,200 stores in 29 states. Saunders, however, went bankrupt through speculation on Wall Street in 1923. By 1932, the chain had grown to 2,660 stores doing over $180 million annually. The stores were either owned by the firm and franchised. The success encouraged imitators, including Handy Andy stores, Helpy Selfy stores, Mick-or-Mack stores and Jitney Jungle, all of which operated under patented systems.[58] During Great Depression, chain stores became the targets of angry local merchants, who secured the Robinson–Patman Act of 1936; it was a federal law that required all retailers to charge the same price for certain items.

By 1900 the advertising agency had become the focal point of creative planning, and advertising was firmly established as a profession. At first, agencies were brokers for advertisement space in newspapers. N. W. Ayer & Son was the first full-service agency to assume responsibility for advertising content. N.W. Ayer opened in 1869, and was located in Philadelphia. In 1893, 104 companies spent over $50,000 each on national advertising. Most sold patent medicines, which faded away after the federal food and drug legislation of the early 20th century. Seven innovators had emerged in the big time: Quaker Oats, Armour meat, Cudahy meat, American Tobacco Company, P. Lorillard tobacco, Remington Typewriters, and Procter & Gamble soap. By 1914, two thirds of the top advertisers came from just five industries: 14 food producers, 13 in automobiles and tires, nine in soap and cosmetics, and four in tobacco.[60] Agencies were forever breaking up and reforming, especially when one executive would split taking with him a major client and his team of copywriters.
Advertising increased dramatically in the United States after 1900 as industrialization expanded the supply of manufactured products to a very large market. In order to profit from this higher rate of production, industry needed to recruit workers as consumers of factory products. It did so through the invention of mass marketing designed to influence the population's economic behavior on a larger scale.[62] Total advertising volume in the United States grew from about $200 million in 1880 to nearly $3 billion in 1920.