Although businesses in Canada sold $136bn in online goods and services last year, only 13 percent of the country’s businesses overall made actual online transactions.
The total is an 11.5 percent rise from $122bn in 2012, but it’s still far behind the US eCommerce amount, which was estimated by Forbes to be around $262.3bn before 2013 came around.
That’s a staggering difference; and part of what’s to blame, according to Andrew Goodman of Page Zero Media, is that “a lot of bright young Canadians might feel like the opportunity in Canadian e-commerce is too small, that the scale pales in comparison to the United States, so why pursue a national Canadian project when you could hop on board with a global start-up[?]”
It seems that the lack of faith in Canada’s progress in the eCommerce sector is causing more and more people to venture out into other markets; people including young innovators with bright minds that could be focusing instead on bringing Canada up to speed.
Likewise, potential Canadian customers that are frustrated with the lack of services in their country and are taking their business elsewhere – mostly to American retailers that offer a much more convenient and enjoyable online experience.
There is some note of optimism, however. Canadian online coupon site, Shopster, is definitely bucking the trend and providing a gateway to Canadian shoppers looking to find bargains on the internet. The fact that the site is booming is testament to the huge. albeit unrealized, potential of Canada's eCommerce market.
Online retail titan Amazon is also stepping up to to fill the gap in Canadian eCommerce and reap the benefits, according to a study done by ThinkShopper Google and L2.
Erin Young, chief marketing officer at Well.ca – a Canadian online shop that sells baby, health and beauty products – said: “[Amazon] entered some of our categories in the early half of 2013, and we certainly felt the impact. But we view their presence as a good thing in the sense that Canadians lag Americans and many European countries.”
“The way we look at it is, they are likely to bring people into the [product] category and highlight the e-commerce channel as a channel that’s viable for Canadians,” he said.
Hopefully with the introduction of such a heavyweight of online retail into the stagnant Canadian eCommerce market, other companies will notice the profits they could be making. Even if Amazon will provide some tough competition for smaller retailers, it could at least serve as the catalyst the country needs in order to progress into the digital market and remain competitive.