VHS was HUGELY popular in the '80s. That was the birth of the video boom, and stores were everywhere, from big chains like Blockbuster to little mom-and-pop shops. At times it felt like any place that had a cash register rented video tapes. And the demand for rental material grew so greatly that filmmakers started making movies expressly for home video. Most were cheap little amateur horror movies shot on video (often referred to as SOV movies) like Blood Cult, Sledgehammer, Black Devil Doll From Hell, Boarding House, and on and on and on.
VHS remained the primary home video format in the '90s Laser discs came in the early '90s but, while they sold decently, the players and discs were too large (a laser disc is roughly the size of a vinyl album). It wasn't until DVDs became popular in the late '90s that VHS started taking a back seat. In the mid-00s, VHS finally fell out of popularity (I believe the last major movie to receive a VHS release was the David Cronenberg flick A History of Violence, in '05). Some films do still get VHS releases, but in very limited prints, essentially aimed at nostalgics.
But for a while there, yes, VHS, was insanely popular. Personally, I miss those days in the '80s where my friends and I would go to the local video store and spend hours browsing titles.
If you haven't seen it, there's a documentary called "Rewind This!" from 2013 that does a really good job of exploring the appeal of VHS, and the growth of the '80s home video boom.