Why Bitcoin Will Take A Little Longer To Win At Retail

Opinion | February 13, 2019 By:

A publication contacted us last week. As they asked questions, I began to reflect on my 33 years in lingerie, and the payment systems we have seen rise, like PayPal, and decline, like personal checks. While they did not use this information, the history of payments methods is actually quite fascinating, at least at panties.com and our Panty-of-the-Month collection.

This caused me to ponder, “What would have to happen for bitcoin to be widely adopted as a retail payment method?”

We are often asked, “What would have to happen for more of your suppliers to adopt bitcoin?”

Ha! Less than half of our lingerie suppliers even take PayPal. And those who do started only in the past couple years. You are talking about people whose lives revolve around color, lace and fashion.

It would take three things: Passage of time, public acceptance, and ease of use. Computers used to be an oddity. They were made by geeks and sold to geeks. Developers had to make computers moron friendly in order to get them into the American homes. It has taken the better part of 30 years for computers to migrate from the lab to the living room. I think we expect far too much of bitcoin far too soon. Patience is a virtue here.

Because I’ve been in business since 1985, I wanted to go into the trends I’ve seen in payment methods. It is really very interesting – not at all as boring as one would think.

I hear credit cards have been around since the 1950’s, but it was somewhere around 1965 that my parents first started to use them. Before that point in time, everything was cash, checks, and layaway. Most stores had charge accounts. You made payments on your bill on a monthly basis. Credit cards put all of this in one account that you paid for to one company; it was both novel and convenient.

About 1965, credit cards started to become part and parcel of American commerce. In the 1950’s, I can’t remember them being used at all. Of course, I was very small, but I don’t think many took them back then. So it took from the 50s until the mid-60’s for credit cards to become accepted as part of our daily use. And they were almost always used in person.

The way you would know if a credit card wasn’t good in 1965 was, you would look it up in this little booklet that was sent to retailers once a month by Visa and MasterCard. They gave you a list of the numbers that were no good, and you looked up the number. If the number of the card you were presented was not in the book, you simply took the charge and send it off to your bank.

By the time I started in mail order in 1985, what you would do is call an 800 number read them the credit card over the phone, the expiration date, and the amount. They would either accept or decline. If they accepted, they would give you a code to write on the receipt. For physical stores, those were the days of what I called the “zoop zoop” machines. You would put the credit card in this little metal holder and run another metal piece over the top, making a carbon copy of the credit card. You gave the carbon copy to the customer, and send the hard copy physically to the bank.

In 1985, every single day we would send our cards to the bank along with checks. And we used to get checks every single day. When people would call to order over the phone (mind you, there was no Internet back in 1985), they would frequently say “I don’t want to give my credit card number over the phone.” So you would have to take time and carefully recite the address, state, city, zip and the amount to send, etc. I would also have to patiently explain that if they sent a check, we would have to hold it in order for the check to clear, but if they sent a money order we could send it right away.

THE CAUTIOUS CUSTOMER

Despite all the time disadvantages, many customers preferred to send in checks rather than divulge their credit card number over the phone. The downside is that we would constantly get phone calls seven days before Christmas asking where they could send a check to get a gift by Christmas Day. As odd as it sounds, we would get many of these phone calls even in the late 90s.

From 1985 to 1990, every Christmas, I would get at least four $100 bills in the mail. Not all in one envelope, mind you, they would just be $100 bills in an envelope along with a person’s order. I would always send them their change. I know this sounds very odd.  I am just trying to give you an overview of the resistance that using credit cards has had in our society. These days, no one thinks twice about picking up the phone and ordering something with a credit card. But it was not that long ago that people simply didn’t want to use them at all over the phone at all. Point being, it took from the 1950s to the late 1990’s for people to fully accept credit cards as a safe way to order merchandise over the phone.

I keep hearing about how disappointed people are that bitcoin hasn’t taken off as a payment method. Bitcoin only been around since 2013, and it’s only been in the American lexicon since about 2017. It hasn’t had time to take off as a socially accepted form of payment. Acceptance of a strange and new payment method literally takes decades. My history is proof of that.