Aaron Montgomery Ward, who didn’t like his first name and seldom used it, was a New Jersey boy who began his earning career as a drummer in the 1860s. He worked for various wholesale and distribution companies, travelling around the South and Midwest and selling tools, cookware and other goods to country stores. He was an affable young fellow. He liked to chat with storekeepers and farmers and others he met in his travels. They all complained about the high prices of goods they bought from drummers.
Ward began to think. Most rural communities depended on drummers for nearly everything they bought from the outside world. The typical drummer took a fairly hefty commission on what he sold, and so did a hierarchy of other middlemen between the drummer and the manufacturer. Ward wondered: Suppose there was only one middleman, and suppose that middleman had no travel expenses to pass on? Suppose he sold and delivered by mail?
Instant success! Ward wet to Chicago and used his modest savings to open one of the nation’s first mail-order companies. He established a few rules: He would buy merchandise only from the original manufacturers or producers, and he would sell only to the ultimate consumers. No distributors, retail stores or other middlemen would be allowed into the pipeline. Moreover, Ward announced that he would sell only to member of a farmers’ fraternal and cooperative organization called the Patrons of Husbandry, later known as the National Grange.
This latter rule seemed odd to many of Ward’s business friends in Chicago. They saw it as an unnecessary limitation of his market. But Ward knew his rural friends well. They were close-knit, though geographically scattered. They were suspicious of outsiders and particularly suspicious of city folk. By limiting his selling to them and by making an elaborate fuss over the fact, Ward made himself one of them – a member of the club. (As a matter of fact he formally joined the Grange, thus gaining access to a convenient mailing list). He guessed that the farm folk would be loyal to him – would buy from him if for no other reason than to spite the city slickers. He also knew that his prices were far lower than those the drummers could offer.
The first catalog of Montgomery Ward & Company was a one-page sheet. Four years later it was a 150-page book, and Aaron Montgomery Ward was a millionaire.