It has taken a long time for Canadian businesses to start selling online and even longer for most to fully embrace it as a way of life. We face unique eCommerce obstacles in Canada, from a lack of local Internet expertise to high postal shipping rates and inferior (yet expensive) Internet access. More Canadian retailers have jumped online in 2015, however, and many saw a double-digit increase in sales in 2014 over 2013, according to a Forrester/Retail Council of Canada Research benchmark report released in June, 2015.
131 Canadian online retailers responded to the Forrester survey, reporting the following statistics:
- 31% of retailers in Canada saw more than a 25% increase in online sales in 2014 over 2013.
- 27% reported online sales remained the same in 2014 as they were in 2013.
- 24% of companies in Canada saw online sales increase 10-25%.
- 12% said sales online increased up to 10%.
Canadian eCommerce Metrics
Some of the most interesting statistics in this benchmark report were the basic online retail metrics for Canada. Some tell us more than you might think at first glance. For example, the high rate of shopping cart abandonment is almost certainly due to the cost of shipping in many cases. That’s yet another reason why we need to pressure the government to call Canada Post on its mandate to provide affordable shipping to Canadians. We can also see the investment in digital initiatives have increased, which clearly paid off for Canadian businesses.
- 2014 average online order value in Canada – $197 (up 49% from 2013)
- Average order for repeat customers – $183 (up 39%)
- Repeat customer rate in 2014 – 39% (up 42%)
- Number of sales from repeat customers – 40% (up 37%)
- Canadian website conversion rate – 3% (up 49%)
- Marketing cost for each sale – $18 (up 35%)
- Customer acquisition cost for each sale – $23 (up 33%)
- Fulfillment cost per sale $15 – (up 22%)
- Customer service cost per sale – $8 (up 17%)
- IT expenses – 7% of sale (up 47%)
- Shopping cart abandonment rate – 55% (up 9%)
We Have Our Priorities Straight for 2015
Canadian Online Retailers finally seem to be focused on the right things. When asked to name their top three online/digital initiatives and priorities for 2015, they responded as follows.
- Marketing 64%
- Omnichannel 39%
- Website Merchandising 38%
- Mobile 36%
- Website Redesign 28%
- Social Media 22%
- eCommerce Replatforming 20%
- Fulfillment and Shipping Improvements 20%
- Checkout Improvements 11%
- Marketplaces 8%
- Customer Service 8%
- Product Development 6%
- Internal Expansion 2%
Online Marketing Strategy
The survey found Canadian businesses are planning to spend more on online marketing in 2015.
- Facebook Marketing – 63% will spend more.
- Performance Search Marketing (such as Google AdWords) – 54% are spending more.
- Organic Search Engine Optimization (SEO) – 54% will invest more.
- Email Marketing to Company Mailing List – 50% spending more in 2015.
- Remarketing / Retargeting of Shoppers in Web ad’s – 47% will spend more.
- Google Product Listing Ad’s – 37% will invest more.
- Shopper Behavioural Retargeting in Online Ad’s – 36% spending more in 2015.
- YouTube Advertising – 35% of Canadian retailers will spend more.
- Email Marketing to Prospecting List – 33% increase in spending.
- Other Social Networks – 32% will invest more.
- Instagram Marketing – 31% are spending more in 2015.
- Affiliate Networks (such as Share-A-Sale) – 30% investing more.
- Blogs or Message Boards – 28% increase in marketing spending.
- Pinterest Marketing – 28% jump in spending.
- Text Ads on Other Sites – Spending 23% more in 2015.
- Traditional Portal Deals (Yahoo, MSN, etc.) – 17% investing more.
- Pop-up / Pop-Under / Pop-over ad’s – 16% spending more.
- Online Marketplaces (Amazon, Shop.ca, etc.) – Spending up 13%.
- Mobile Messaging – 11% are spending more.
- Bing Product Ad’s – 9% will spend more.
- Comparison or Other Shopping Engines – 7% investing more.
- Vine Marketing – 13% spending more.
Mobile Shopping in Canada
The report found a 74% increase in online purchases made with a smartphone in 2014 over 2013. 9% of all online sales at surveyed retailers were made with a smartphone.
Canadian consumers shopped online with their tablet 58% more often in 2014. 13% of all eCommerce sales were made with a tablet.
All growth is expected to continue in 2015. If you’re trying to bring your company online, you may find the following articles helpful:
Checklist: Choosing a Website Host for your Canadian Business
10 Tips for Taking Product Photos That Sell Online
Canadian Stores Can Grab Global Online Shoppers (Statistics)
Test eCommerce Waters with Fulfillment by Amazon (FBA)
Have you invested more into online sales? Has it paid off for you? Please share your experience or questions in the comments below.
Source: Forrester/Retail Council Of Canada eCommerce Benchmark Online Survey 2015
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Melody McKinnon's formal education is in business management, which she enhanced with more than 60 certifications revolving around business, marketing, health, general sciences and writing. In 25 years of working online, she has owned or managed both educational and ecommerce websites. Her book, 7 Recession Proof Online Businesses to Start From Home, is available on Amazon.
Melody has worked with many businesses & brands in a multitude of capacities. She can often be found on CanadiansInternet.com, CanadianFamily.net and AllNaturalPetCare.com, as well as other quality digital publications. Her content has earned reference links from highly-respected websites, magazines and university textbooks.