Aggregators are a modern phenomenon, right? They’re part of the experience of online commerce. Are they really? Actually humans have been presenting products together for comparison and convenience since antiquity.
We think it’s worthwhile to look back to where aggregated marketplaces have their roots, how the model of customer experience has developed over time and see what we can learn from the trajectory that shopping experiences have taken so we can take an educated peek into the future.
In this first of three parts we’ll go shopping in ancient Greece, tour the bazaars of the east, witness the Parisian taste for grand shopping and think about early travel.
Welcome to our Brief History of Aggregators.
Pre-history doesn’t mean the dark ages before we had dial-up. It really all started a very long time ago.
Our story begins in ancient Greece, at the Agora. An Agora is a public meeting place, a little like a town square. You might find the politicians of the day hanging out there. If you wandered around you might stumble upon Diogenes in his bathtub. Or if you landed there a little bit earlier maybe Socrates would try to engage you in dialogue. The Agora was where politics was exercised and much more.
Among the colonnaded periphery these were the first centralised commercial spaces. Merchants would gather and set out their wares. The agora was the first all-in-one commercial destination. It made sense to the Ancient Greek merchants to consolidate their offering in the town square, where people gathered. These were the original marketplaces.
The word ‘agoraphobic’, meaning fear of outside spaces, comes from the Greek word ‘agora’. Maybe shopaholics should be dubbed ‘agoraphiles?’ These social/political/commercial spaces were the beginning of aggregated selling.
Fast forward a little and ancient history develops into some serious commercial establishments. Souks were, at first, open air marketplaces. They’re a little different to the Agora in that they were primarily commercial destinations, purpose-built for selling and buying. They sold the goods from the old, geographical trade routes like the silk road. A string of them stretched for thousands of miles between every middle-eastern and Persian city.
Eventually souks became covered and permanent. Traders filled the spaces and walkways with their wares and customers came to haggle. If you’ve traveled anywhere in the Middle East you’ve probably tried your luck with a seller in the Souk. Maybe you’ve been to the Grand Bazaar in Istanbul and come out with a bargain. Your author has certainly tried, with varying levels of success.
Souks and Bazaars are notable for a natural congregation of sellers offering similar goods and services. It’s in the souk that we first experience seller concentration. For instance, in the larger markets all the cobblers congregate in one area. You want shoes? Head to the shoe quarter. This makes commercial sense. Shoppers are aided by a better user experience, want to easily compare like products and are reassured by the the forces of competition.
Marketplaces eventually turned into whole business districts and between all the little shops the department store was born. Goods were consolidated in one place and shoppers were treated to grand and comfortable buying experiences.
In the 19th century department stores were the way to shop. Paris was pretty good at building them. The big names in New York and London are still destinations. In London the first department stores were not in the West End. Brixton in the south was the equivalent of Boulevard Haussmann or Fifth Avenue. There were a string of huge department stores along the Brixton Road, including Bon Marché, London’s first department store which opened its doors to shoppers in 1876. Only one remains there (Morley’s) but the place deserves its position in shopping history.
The luxury of department stores is not the great innovation, of course. Even somebody who’s been to a dilapidated M&S would agree that it’s the under-one-roof experience that is key to the model. These are palaces of convenience whether they are opulent or down to earth.
Malls are the twentieth century rev’ on the department store. The first one opened in Kansas City in 1922. They extended the department store idea to contain multiple, discrete stores. Under-one-roof has been a successful model.
Retail wasn’t the only service perfect for consolidation. Travel logistics was the other great consumer use case.
Cox and Kings, of India, held the title of the world’s first travel agent, establishing itself in 1758. The rise of leisure travel really gained pace in the late 19th century. That was when the more prominent names like Thomas Cook got into the game. Mr Cook started obscurely, offering members of his temperance movement transportation to a political rally in Loughborough in England. Each paid a commission for their eleven mile excursion and the agency was born. These small trips expanded from the north of England to the capital and soon beyond, including the transportation of the British army in Sudan. The Thomas Cook company ushered in mass tourism.
Travel agents deployed a broker model. By necessity the arrangement of travel was widely fragmented across geography and language. The product suite was also complex. Arrangements for moving between an origin and a destination was one consideration. Accommodation and local excursions quite another. Owning and commoditising these relationships would clearly be profitable if the tangle of options and suppliers could be painlessly packaged and offered to travellers. Travel was perfect for aggregation.
The travel supplier case was equally compelling. Advertising your steamboat service or hostelry to any traveller who wasn’t local would be incomprehensibly costly. Crossing cultural and language barriers impossible. Paying commission to agents was a simple and obvious efficiency.
We’ve travelled through millennia to jump on Thomas Cook’s tourist train. This was the true, early history of product aggregation.
Next time we’ll look at the rise of mail order, what arrived with the internet and how online product aggregation was commercialised. See you in the middle-era of consolidated buying.