Canadians embracing ecommerce

Bakers Journal
November 01, 2017
Written by Bakers Journal
TORONTO — Canadians are continuing to embrace ecommerce as a real and undeniable alternative to brick and mortar. The Canadian Ecommerce Channel Report from The NPD Group indicates online retail sales grew 18 per cent during the 12 months ending in June, while brick and mortar remained flat.

"Most manufacturers and retailers are now fully invested online and have dedicated ecommerce functions. Mobile commerce is also now top of mind for retailers and manufacturers as the smartphone has become a staple across most societies globally," said Armin Begic, director of the Retail Business Group at NPD, in a news release. "Now that the online channel has clearly established itself as an important function for most retailers and manufacturers, the way we utilize and think about it must also change once again, in order to keep up with changing consumer behaviour."

Where are Canadians spending their online dollars?

Overall, ecommerce accounted for 11 per cent of total retail sales (including grocery). The report shows that apparel, consumer electronics and books/stationery/office supplies are most commonly found in the online basket. Apparel/footwear continues to be the most purchased category with an average spend of $102 per order.

Online advertisement on social media or other websites continue to play an important role in triggering online purchases. Furthermore, online/digital flyers were also more effective than physical paper flyers as a purchase triggers for online purchases.

Who's buying online?

While "Super Online Shoppers" (e.g. consumers within the top 25-30 percentile in terms of the number of categories purchased online in the past 6 months) were once the largest driver of ecommerce growth (making up 41 per cent of Canada's ecommerce users in 2014) this group has slowly shrunk in recent years. In 2017, only 26 per cent of shoppers were considered "Super Online Shoppers". In other words, growth is no longer being driven by a small group of hyper-active online shoppers – instead, the traditional shopper is beginning to embrace the notion of ecommerce through regular, although less frequent, purchases.

The role of social media

The role and use of social media platforms by advertisers has also changed rapidly and should continue to change in tandem with consumer's expectations. Last year, nearly 50 per cent of consumers indicated they would not like to receive ads from brands and retailers through their social media feeds. This year that number was down significantly to just over 25 per cent of consumers. As this trend continues and consumers become more comfortable with receiving advertising messages through social media, retailers and brands shouldn't be afraid to utilize this growing and effective medium.

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