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Ward, Montgomery

Born: 1844  Died: 1913
Occupation: entrepreneur in mail-order merchandising
From: American Inventors, Entrepreneurs, and Business Visionaries, Revised Edition, American Biographies.

Nearly everyone has purchased something at one time or another from a catalog mailed to their home. The man who had the idea for the first mail-order catalog was Montgomery Ward. His ideas about how merchandise could be sold revolutionized the way many American businesses operated.

Ward was born Aaron Montgomery Ward on February 17, 1844, in Chatham, New Jersey. His parents, Sylvester and Julia, were farmers. At age nine he moved with his family to Niles, Michigan, where his father had bought a general store and its entire inventory; in fact, the store was run-down and completely empty. Having no money left with which to buy goods, the Wards turned the store into a house and Sylvester Ward found work as a clerk in another store. At age 14 Ward left school to help support the family, and for the next three years he worked in factories that made barrel staves and bricks. In 1861 he moved to nearby St. Joseph to be a clerk in a general store, and three years later he had worked his way up to manager. In 1865 he moved to Chicago, Illinois, where he worked for two years as a salesclerk for Marshall Field, the retailing pioneer.

In 1867 Ward became a traveling salesman for a Chicago-based dry-goods wholesaler, calling on general stores in Illinois, Missouri, and Kansas. He quickly found out that many rural customers were unhappy with the selection and price of goods in most general stores. This realization led him to the idea of developing a mail-order business, whereby customers could make their selections from a catalog mailed to their home, then mail their orders to a wholesaler who would ship the merchandise by railroad, thus eliminating the middleman and his profit. He figured he could hold prices down by buying in bulk from manufacturers, paying them cash, and shipping all customer orders COD (cash on delivery), thus making the U.S. Post Office his collection service.

Around 1870 Ward became a buyer for C. W. & E. Pardridge Company, a Chicago wholesaler and retailer. In addition to buying for Pardridge, he also bought merchandise that he planned to sell via mail order. He experienced a major setback in 1871, when the great fire that destroyed much of Chicago also burned up all of the inventory he had accumulated. However, Ward was a determined man with a sure-fire plan, and so he refused to give up. Instead, he took on as partners two fellow employees at Pardridge's, George Drake and Robert Caulfield. In 1872, the same year he married Elizabeth Cobb with whom he had no children, one of his wife's uncles helped arrange for Ward's company to become a preferred supplier to the National Grange. The Grange was an organization of thousands of farmers and small businessmen that operated cooperatives and retail stores across the rural Midwest. In 1872 the Original Grange Supply House, as Ward's company was first called, issued its first catalog, a single sheet of paper with about 150 items on it. By 1875 Ward had bought out Drake and Caulfield, taken on a new partner, his brother-in-law George Thorne, and quit his job at Pardridge's.

Ward had gauged the temperament of rural consumers perfectly. Grange members eagerly bought from Ward, especially after he offered a 10-day money-back guarantee on any item that failed to meet the customer's expectations. Although he was not the first merchant to offer a money-back guarantee, he did coin the phrase "satisfaction guaranteed or your money back." Soon, non-Grange members were becoming enthusiastic customers as well. By 1889, when the company changed its name to Montgomery Ward & Company, it was grossing more than $2 million annually.

Ward's success was predicated on several factors. First, Ward offered a wide variety of good-quality merchandise at reasonable prices; his 1884 catalog featured 10,000 items. Second, he developed efficient methods for buying, warehousing, and shipping goods. Third, he included in his catalog testimonials from satisfied customers and Grange officials. These endorsements helped alleviate suspicion on the part of rural consumers, thus making them more likely to buy. Fourth and most important, he transformed his one-page catalog into a "dream book," as it became known. Ward's catalog featured pictures and descriptions of items that many rural consumers did not know existed. Mailed free of charge to millions of people every year, it brought these marvelous things right into their homes where they could peruse it at their leisure without being pressured by a salesman. In the days before radio and television, rural folk spent many a spare moment gleefully thumbing through Ward's catalog while trying to decide what to buy next. The mail-order catalog revolutionized business in America by drawing millions of rural consumers into the rising tide of consumption that had already engulfed the nation's cities.

Ward's success inspired a host of imitators. The most successful was Sears, Roebuck & Company, which was founded in 1891 and eventually relegated Montgomery Ward to second place in the mail-order business. But by that time Ward had exited from the company he founded. In 1893 he sold his interest in Montgomery Ward to Thorne. Although he retained the title of president, he no longer drew a salary or played any role in the company's operations. Under the management of Thorne and his five sons, Montgomery Ward continued to thrive. At the time of Ward's death, the company was grossing $40 million annually and employed 6,000 workers. In 1921 the Thornes relinquished control of the company, and five years later the new management began opening retail outlets across the country. Meanwhile, Montgomery Ward continued its mail-order business until 1985. By this time rural America had been transformed by the automobile and the paved highway to such an extent that virtually everyone living in the country had easy access to large stores in neighboring towns and malls.

Ward lived a luxurious retirement. In addition to his large home in Highland Park on the outskirts of Chicago, he bought La Belle Knoll, a sprawling estate in Oconomowoc, Wisconsin, where he raised Thoroughbred horses, and a winter home in Pasadena, California, where he played golf. But he also used his fortune—estimated at more than $15 million at his death—to do good. He successfully fought many long and expensive legal battles to keep Chicago's Grant Park from being developed, and he contributed millions of dollars to charity. He died on December 7, 1913, in Highland Park.

 

Baker, Nina B. Big Catalogue: The Life of Aaron Montgomery Ward. New York: Harcourt Brace, 1956.

Hucke, Matt. "Aaron Montgomery Ward," Graveyards of Chicago. Available online. URL: http://www.graveyards.com/rosehill/ward.html. Downloaded on July 6, 2009.

Latham, Frank B. 1872–1972: A Century of Serving Consumers; the Story of Montgomery Ward. Chicago: Montgomery Ward, 1972.

Text Citation (Chicago Manual of Style format):

Carey, Charles W., Jr., and Ian C. Friedman. "Ward, Montgomery." American Inventors, Entrepreneurs, and Business Visionaries, Revised Edition, American Biographies. New York: Facts On File, Inc., 2011. American History Online. Facts On File, Inc. http://www.fofweb.com/activelink2.asp?
ItemID=WE52&iPin=AIE0250&SingleRecord=True (accessed August 21, 2014).

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