Cyber Monday: How Canadian consumers are changing online shopping

If consumers are benefiting from online shopping, the centrepiece of today's Cyber Monday promotional blitz, it is because they are already driving how retailers are adapting their e-commerce business.

E-commerce increasing as consumers take control of retail web experience

Online shopping is growing in Canada, but retailers wanting to reap the greatest rewards from e-commerce need to respond to consumers' expectations. (iStock)

Sharon Ng Hayes has been shopping online long enough to see the e-commerce revolution come around to beating a path to her front door.

The avid online shopper and co-founder of The Backseat Stylers fashion blog was buying clothes, shoes and accessories without leaving the comfort of her Toronto couch long before most Canadians started becoming comfortable offering up their credit card details over the internet.

And long before today's Cyber Monday — the U.S. shopping phenomenon following hot on the heels of Black Friday — became an annual American Thanksgiving marketing blitz  to encourage consumers to go online for their bargains.

Sharon Ng Hayes turned to online shopping - particularly from websites of U.S. retailers - when she couldn't find pricing and selection she liked in Canada. (Backseat Stylers)

Ng Hayes had turned to U.S. retail websites when she couldn't find the selection or prices she wanted at home, but now she is discovering more options on this side of the border, where Canadians spent $18.9 billion online last year, up 24 per cent over 2010 .

"A lot of the products that we could only get from the States we can actually get here now," says Ng Hayes.

In fact, shopping Canadian online has become so matter of fact that Ng Hayes recently decided to give up the Buffalo postal box she and a friend shared for about seven years to collect their online purchases from American and international retailers.

"A lot of our Canadian retailers, they're getting online and they're investing in their e-shop and we as consumers are really benefiting from that."

Double-digit increases

If Canadian consumers are indeed benefiting from online shopping, it is undoubtedly because they are driving how retailers are adapting their e-business.

"The consumer has taken full control of the shopping experience," says Ryan Brain, a partner and computer expert with consulting giant Deloitte in Toronto.

In a survey for Deloitte's holiday shopping outlook, almost 28 per cent of Canadians said they prefer to shop online rather than to go to the mall.

"It's a trend that's absolutely accelerating at a very notable pace," says Brain, noting that "double-digit" increases in online sales are expected for the foreseeable future

"We are seeing many retailers experiencing all of their growth through the online channel."

For sure, they want it to be easy.- Kirsten Chapman

Sales in traditional bricks-and-mortar stores are "either flat or, in many ways, declining for certain retailers."

And Brain sees two reasons for this online trend: It is because of what consumers "are saying is important to them;" and because retailers are offering more in terms of products than they have in the past.

All about convenience

Retailers are also paying more attention to their websites and making them more attractive for consumers. Sign-up forms and "check out" processes are being simplified, more delivery options are being offered at cheaper prices and more product information — sometimes with video — is on display.

"It's become a lot easier, and a lot of U.S. companies now have warehouses in Canada so that it's not shipping across the border," says Cathie Mostowyk, founder of Shoestring Shopping, a website featuring bargains and warehouse sale shopping in the Toronto area.

Retailers have also been taking note of consumers' concerns.

"For sure, they want it to be easy," says Kirsten Chapman, executive vice-president for online and mobile at Indigo Books + Music. "It's all about convenience."

Indigo has just launched a single-page checkout, and has a new mobile app for its customers. Online shoppers can now pick up their purchases for free in a store.

Other changes on the website include product ratings from customers who have purchased those goods. Videos have been added.

A worker prepares an item for delivery at Amazon's distribution centre in Phoenix, Ariz., where the web-based retailer is preparing for Cyber Monday. (Ralph D. Freso/Reuters)

Those changes come as Indigo's online sales have been increasing, while sales in stores have been declining.

Indigo's annual reports show online revenue rose from $90.6 million for the year ending April 2, 2011 to $91.9 million for the year ending March 30, 2013. At the same time, revenue from superstores and smaller stores fell from nearly $817 million to $762.3 million.

Last year's Cyber Monday was the "biggest online day ever" for the company, says Chapman, and she'll be watching closely for today's results.

"I think for us we want to really be focused on where the customer is at. The customer is moving to mobile and making sure that that experience is as great as it can be, and as easy as it can be is where we're focusing our attention."

No hunt for a parking spot

Along with the increased ease some customers find in shopping from a screen, there is also the physical convenience of avoiding the car to get to the mall.

"I think it's because people are looking for shortcuts to getting what they want on their terms," says Will Giles, a senior vice-president at MasterCard.

There isn't very much nowadays that you would want to buy that you can't buy online.- Sharon Ng Hayes

"There are no lineups, no searching for parking, the pricing is generally very good and it doesn't have the same boundaries or borders as bricks and mortar does, so I can really shop around the world from my sofa."

A survey for MasterCard after the 2012 holiday shopping season found that online sales increased 26 per cent over the previous year.

But over the past couple of years, MasterCard had also identified a couple of factors holding people back from online shopping.

"Historically, people have always been a little untrusting of sites [where] they weren't familiar with the merchant," says Giles.

People also didn't like filling out long forms, which can be particularly difficult or frustrating on the smaller screen of a smartphone.

That led to MasterCard to the introduction of MasterPass, a product the lender hopes will offset such worries through a simplified way of completing purchases with retailers who have signed on with the service.

Room for improvement

As a shopper, Ng has seen online shopping opportunities getting better across the board in Canada.

"There isn't very much nowadays that you would want to buy that you can't buy online," she says. "Not that long ago, you couldn't say that, especially here in Canada."

Still there are some areas where she sees room for improvement: free shipping and returns, for example.

"I think at this point that's pretty key when a customer is making a decision as to whether to purchase online."


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