Retail ecommerce in Canada is late blooming compared with the US. But over the next few years, it will start to realize its potential. In 2010, consumers in Canada spent CAD16.5 billion ($16.0 billion) on domestic and foreign sites for products and services (including travel). By 2015, online spending will nearly double, reaching CAD30.9 billion ($30.0 billion). Shoppers are increasingly comfortable buying high-consideration goods online, such as home electronics and apparel. The allure of group buying is also introducing more consumers to ecommerce.
Still, there are major obstacles curbing interest in online buying, including limited product selection, reservations about buying products sight unseen and high shipping costs. The lack of market participation has caused several prominent store-based retailers to shy away from ecommerce. But some internet pure plays and specialty retailers are succeeding by offering superior customer service, multichannel convenience and unique products.
The aggressive entry of US web retailers into Canadian ecommerce may also accelerate market growth. Major store-based retailers are under pressure to launch viable ecommerce businesses or risk losing market share. US retailers, who give shoppers greater product selection, are also introducing those in Canada to ecommerce. Some of the pure plays and specialty retailers believe the opportunity to acquire new customers can benefit all retailers.
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