Ecommerce in Canada: Its Time Has Come

Ecommerce in Canada is undergoing a major disruption. Spurred by competition from Amazon, retailers there are investing in digital, and it has become a way to battle the challenges of a reaching a small population dispersed over a vast land mass.

“While Canada has lagged behind the US and UK in ecommerce, it is now catching up as double-digit annual gains drive what growth there is in Canada’s retail sector,” said analyst Paul Briggs, author of eMarketer’s new report that examines the country’s ecommerce prospects. (Subscribers to eMarketer PRO can access the full report.)

According to eMarketer’s latest forecast, ecommerce will account for 10% of total retail sales by 2020.

What’s more, consumers and retailers are embracing some of the innovative ecommerce trends that have yet to fully catch on in more advanced ecommerce markets, Briggs said.

For instance, omnichannel strategies like click and collect, in which companies like Toronto-based grocer Loblaw lets shoppers order online, then pick up groceries later. This service sidesteps delivery expenses, substantial in Canada, in which 85% of distribution costs are in the last mile of delivery.

The omnichannel consumer in Canada intensifies his or her online shopping during the holiday season, and does so much shopping with mobile that a quarter of all retail ecommerce is expected to occur via mobile device this year.

Plus, Canadian omnichannel consumers have always loved shopping south of the border in the US.

Traditionally this was because online selection in Canada was poor. But that’s changing, according to Briggs. One reason is the strength of Canadian currency relative to the US dollar. “But the bigger factor is the vast improvement in the quality of offerings from Canadian retail—it is a big part of why [consumers there] are shopping domestically more than ever,” he said.

In the latest episode of “Behind the Numbers,” Paul Briggs talks about ecommerce in Canada in 2017 with host Marcus Johnson. Tune in below or subscribe to get access to all the episodes.