Canada’s Digital Disruption of the Retail Market
With a population of about 36 million, less than the state of California alone, Canada’s e-commerce sales had traditionally grown quite slowly, and many Canadian online shoppers had trouble finding products or prices they were looking for. However, things are changing. Between the months of January and July 2017, Canadian online retailer spending rose 43.1% to $6.55 billion!
Digital Commerce 360 states that this growth is more than three times greater than what was projected for the entire year of 2017. In 2013, just 13% of Canadian businesses were selling online and Canadian shoppers would instead shop elsewhere.
In Canada, e-commerce accounts for 7% of total retail sales, which is where the US was back in 2011. However, Forrester Research projects that 10% of all Canadian retail spending in 2019 will be conducted online, which is almost equivalent to – on a percentage basis – the 11% forecasted for the U.S. market.
Who are the Canadian consumers?
BCG.com’s research shows that Canadians between the ages of 18 and 44 are driving the e-commerce boom. They are two to four times more likely to make at least one online purchase a month than consumers over the age of 55. In total, 18.1 million Canadians will buy something digitally this year and by 2019, nearly 75% of internet users in Canada will be digital buyers.
Canadian Online Retailers Who are Changing the Game
Within the past two years, all the largest Canadian retailers have improved their rankings on the annual Global Powers of Retailing list published by STORES Magazine. Internet Retailer predicts that the number of Canadian e-retailers represented in their Top 1000 rankings of North American e-retailers to nearly triple this year to 58 from just 19 a year ago.
Who is helping build Canada’s online retail economy? “There is a really robust startup ecosystem here, and there is pent-up consumer demand that can be lucrative for those who can figure out how to operate locally,” says Tim Ray, CEO of Carnivore Club.
One company that is a great example of this is Golf Avenue, rated 59 in the Canada 100. It all began with two 17-year-olds who bought used golf clubs on clearance in a brick-and-mortar golf shop and sold them on eBay for profit. For many years, Golf Avenue sold this way until eventually launching GolfAvenue.ca in 2012. To gain more US consumers they launched GolfAvenue.com 4 years later. When they originally launched GolfAvenue.ca, there were no other online retailers in Canada that sold used golf gear.
Who else is helping build Canada’s online retail economy? Many large US and European retail companies are also opening up shop in Canada. For instance, IKEA announced a total sales of $2.17 billion in Canada for the financial year ending in Aug. 2017. This is an increase of 5.9% over 2016. In fact, IKEA Canada has seen an increase in sales by 33.5% in the last three years.
Canada is a great international market to break into, but sending parcels internationally can cause shipping headaches. These headaches often translate into increased rates of customer complaints over things such as delays and high costs. This is where most shippers fail.
Software for the Assist
Fortunately for Canadian e-commerce companies, or companies just wishing to ship internationally, there are a handful of technology solutions equipped with the capabilities to allow companies to be successful. These software-driven solutions are re-imagining how e-commerce, manufacturing and 3PL companies are shipping their products to customers.
If the world is your market, you already know that while the ability to ship products globally can contribute to the success of your company, it also presents a new set of challenges. As the most compliant multi-carrier shipping software on the market, ProShip can help you master the complexities of international trade, which creates a much improved customer experience, and in turn, leads to increased sales.