Ward, Aaron Montgomery

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Ward, Aaron Montgomery

(1843-1913)
Montgomery Ward
Holding Corp.

Overview

Aaron Montgomery Ward was an experienced salesman and store manager when he and his brother-in-law established the first mail-order firm to carry a wide variety of goods in 1872. Ward's catalog, known as "The Wish Book," brought a wide selection of goods to America's farmers and rural residents of the Midwest, who had complained of the poor choices and high prices offered by their local general stores and merchants. Montgomery Ward and Company was the leading mail-order house in the United States until 1900, when it was surpassed by Sears, Roebuck and Company in annual sales. The company later expanded and opened branch stores in the 1920s, and it eventually discontinued its catalog operation.

Personal Life

Aaron Montgomery Ward was born on February 17, 1843, in Chatham, New Jersey. His great-grandfather was an officer in the Revolutionary War. His parents, Sylvester and Julia (Green) Ward, moved to Niles, Michigan, where Aaron attended public schools until he was 14. Then he was apprenticed in a barrel factory and later went to work in a brickyard.

Ward's first experience in retailing came when he was about 19 and went to work at a general store in St. Joseph, Michigan. After a few years he was made general manager of the store. In 1865 he went to Chicago to be a clerk at what later became the Marshall Field department store. After a couple of years there, he went to work for the wholesale dry goods house of Willis, Gregg and Brown. When that firm failed, he became a traveling salesman for the St. Louis-based dry goods wholesaler, Walter M. Smith and Company.

Ward married Elizabeth J. Cobb of Kalamazoo, Michigan, in 1872. Although the couple never had any children of their own, they adopted a daughter Marjorie. Upon Ward's death in 1913, his estate passed to his wife, who later distributed it to various charities. The principal beneficiary was Northwestern University, which established medical and dental schools in his honor.

Career Details

Ward began to think of starting his own mail-order business when he was a traveling salesman. He became well acquainted with the rural way of life in the Midwest and the needs of farmers and other residents. Their biggest complaint, he discovered, was the high prices they paid for goods at the local general stores. In addition, the selection of merchandise offered by the stores was meager at best.

To accumulate enough capital to start his own business, Ward moved back to Chicago and went to work for C.W. Partridge, a dry goods firm. He was about to start his own business when the Great Chicago Fire of 1871 wiped out his savings. By the following year, he had managed to save about $1,600 of his own money and convinced his brother-in-law, George R. Thorne, to put up an additional $800 to launch a business.

Montgomery Ward and Company opened for business in 1872 from the loft of a livery at Clark and Kenzie Streets in Chicago. The company's first "catalog" was a single sheet listing goods for sale and explaining how to order them. By 1874 the catalog had grown to an eight-page booklet, and Ward introduced its famous guarantee. Although the wording of the guarantee has changed over the years, it essentially permitted customers to return any merchandise if they were not completely satisfied. The 1874 catalog stressed that goods were sent "subject to examination," which meant the customer had a chance to examine the goods before agreeing to purchase them. Ward's guarantee helped overcome any reluctance associated with ordering merchandise sight unseen from a company located far away in Chicago.

Montgomery Ward sold its merchandise for cash and did not offer credit, which helped to keep its prices lower than those of local general stores. Ward also was able to keep prices down by carefully selecting merchandise that could be purchased in bulk at a lower price.

One of the keys to Ward's early success was the arrangement he reached with the recently formed farmers organization known as the National Grange, which saved farmers money through cooperative purchasing and elimination of the middle man. Montgomery Ward soon could call itself "The Original Grange Supply House." Cultivating the account, Ward gave Grange members a ten-day grace period in which to make payment. He also used testimonials from Grange officials in his ads and catalogs and displayed the company's goods at Grange meetings.

Ward actively promoted his new business, not only by mailing out catalogs, but also by advertising in periodicals such as the Farmer's Review and the Women's Farm Journal. He also mailed out almanacs that included merchandise advertisements, and in the 1890s sent out barnstorming railroad cars to display the firm's merchandise. The company wanted to project a friendly image, and customers were always welcome to visit the Chicago headquarters. During the Columbian Exposition of 1892 about 285,000 visitors toured the Ward facility.

Ward's company and catalog grew rapidly in the 1870s and 1880s. Almost every item in the catalog was illustrated with a woodcut by the early 1880s. The 1883 catalog stated that the company had half-a-million dollars worth of merchandise in stock, and the next year's catalog listed 10,000 items for sale in 240 pages. That year the company also began to construct its own building, which was completed in 1887 and provided 120,000 square feet of space for the rapidly growing business. Annual sales reached $1 million in 1888.

Montgomery Ward and other mail-order businesses received a boost in 1895 with the introduction of Rural Free Delivery by the U.S. Post Office. Ward's main competitor was the recently established Sears, Roebuck and Company, which began to overtake Montgomery Ward as the leading mail-order house.

Montgomery Ward began to receive national attention in 1900 with the construction of the Ward Tower in Chicago. In 1900 Sears surpassed Montgomery Ward in annual sales for the first time, and remained ahead until Ward discontinued its catalog operation later in the century.

Ward himself spent less time on the company's daily operations in the 1890s. In 1901 he retired, although he retained the title of president. He spent much of the last decade of his life working to preserve the natural waterfront parks of Chicago, and his efforts led to the establishment of Grant Park. At the time of Ward's death in 1913, Montgomery Ward had annual sales of $40 million and 6,000 employees. It was mailing out about 1.5 million catalogs a year. Ward had also established a vehicle factory, a clothing factory, and an agricultural implement factory.

Social and Economic Impact

As a pioneer in mail-order selling, Aaron Montgomery Ward's influence has been felt in the direct marketing industry throughout the twentieth century. In the earlier part of the century, mail-order sales fell as the automobile made it easier for people to shop at stores. In the latter part, that trend reversed as catalog sales began to account for an ever-increasing share of retail sales. Shopping by mail proved time and energy efficient, making it a good fit for a society where a growing number of women were joining the workforce and time had become a valuable commodity.

Chronology: Aaron Montgomery Ward

1843: Born.

1865: Began working as a clerk at Marshall Field department store in Chicago.

1871: Great Chicago Fire virtually wiped out Ward's savings.

1872: Established Montgomery Ward and Company in Chicago (with brother-in-law George Thorne) and issued first mail-order catalog.

1873: Company became official supply house of the National Grange, a farmers cooperative.

1887: Company moved into its own building with 120,000 square feet of space.

1888: Annual sales reached $1 million.

1900: Ward Tower was completed in Chicago.

1900: Sears, Roebuck and Company's annual sales surpassed those of Montgomery Ward for the first time.

1901: Ward retired, but retained title of president.

1913: Ward died; company had sales of $40 million and 6,000 employees.

Montgomery Ward's mail-order business greatly improved the quality of life in rural America in the latter part of the nineteenth century. The company's huge catalogs made a vast assortment of merchandise available to a wide range of people who would have had a much more limited selection otherwise. Through bulk purchases, Ward was able to offer those goods at reasonable prices, much lower than were being offered by local general stores throughout rural America.