Chapter 6 Section 2 Rise of Big Business

Review  What business did Carnegie invest and become rich in?  What is “vertical integration”?  How did Rockefeller become rich?  What is “horizontal integration”?

Cornelius Vanderbilt  Prior to Railroad– operated shipping business  By 1869 gained control of New York Central and 2 others that connected New York City  Soon controlled lines between Chicago, Cleveland, New York, and Toledo  Provided more efficient service by combining small railroads  By 1877 controlled 4,500 miles of track  Personal fortune of $100 million

George Westinghouse  1869 at age of 23 established Westinghouse Air Brake Company  After public demonstration of effectiveness of air brake his business grew  By 1874 air brake was on 7,000 passenger cars

George Pullman  Built Railroad cars to make travel more comfortable  Built company town south of Chicago in 1880  Hoped to encourage educated, healthy, peaceful and virtuous workers  Provided homes, stores, church, library, theatre, medical offices and athletic fields strictly controlled daily life in company town

Mass Marketing  Persuade consumers to purchase products  Brand names– name recognition “Standard Oil”– implies standard for industry  Packaging to set products apart  Helped create consumer culture  Montgomery Ward and Sears, Roebuck and Company– develop mail order catalogs

Department Store  Variety of products under one store  Buy in bulk and set cheap prices Marshall Field– Chicago R.H. Macy– New York John Wanamaker– Philadelphia  Becomes domain of women  Hired as workers  Enticed to shop

Chain Stores  Branch stores in many cities  Woolworths– Frank Woolworth in 1879  By 1900 had 59 stores around country