What turned once reluctant Canadians into avid online shoppers? It’s probably not what you think
Not so long ago, Canadians were known as reluctant online shoppers, largely ignoring the new online channel in favour of traditional bricks and mortar retail. But today that storyline has changed.
While we still love to shop in person, 80% of us are also shopping online, buying everything from clothes to sporting goods to furniture. Consumers here generated almost $30 billion in online sales in 2015; that’s expected to top $55 billion in just three years.*
So what changed our minds?
Canadian retailers had a lot to do with the shift. First, they started to provide us with a better online experience, improving the design of their virtual stores and expanding their online inventory. But they also began to better understand the customers’ mindset. They paid more attention to what motivates online shoppers to stay on the path to purchase, and what can cause them to jump off and abandon their carts along the way. The findings continue to surprise.
Here’s what we know about what Canadian online shoppers really want:
We all crave simplicity when it comes to technology. In the world of online shopping that means not forcing consumers to trudge through too many steps in the checkout process. If it takes too long to make a purchase, we apparently get annoyed and start abandoning our carts. Savvy retailers get this and have streamlined the purchase path, removing as many barriers as possible to help ease our way through until the end.
Shipping and delivery information
Consumers want more information around shipping and delivery so we can make decisions that fit our schedules, budgets and lifestyles, which gives us more confidence that our online shopping experience will have a happy ending. Things like knowing shipping costs and delivery ranges nudge us toward the Place Order button.
But we also want to know that information sooner rather than later. For instance, almost one-third of shoppers will complete their online purchase if the estimated delivery date is available prior to checkout.
We also like information that gives us transparency into and control over the experience, such as having delivery options and tracking numbers. In 2015, Canada Post saw more than 425 million online tracking events, while Canada Post’s free FlexDelivery service, which allows people to have their orders sent to a post office of their choice, caters to online shoppers’ desire for flexibility.
Offering some form of free shipping, such as a minimum spend to qualify for it, is one of the main ways retailers can turn shoppers into buyers. It’s also why savvy retailers devote so much effort to finding the optimal free shipping threshold – known as the sweet spot – that resonates with their specific customers. If the free shipping minimum is too high, shoppers may balk; but if it’s too low then you, the retailer, are not optimizing cart size, and potentially losing sales.
Free shipping offers even beat out fast shipping in the list of what consumers want – nearly two-thirds of us are willing to sacrifice fast delivery for free shipping. It’s also contributed to an ultra-competitive retail environment, as more than half of Canadians are willing to buy from competitors that offer free shipping. No wonder among the biggest Canadian e-commerce merchants, the percentage of retailers that offer some form of free shipping has gone up, from 57% to 65% in two years.
An easy plan B
What if when you open the box it isn’t what you expected? What if it fits weird in the shoulders? As shoppers, we fill our carts because we like what we see on-screen – but we don’t want to officially click to buy unless we have an easy out should we not like what we receive. For many online shoppers, easy returns are key.
But, it should be noted, consumers also value the ability to simply know what the return process is, regardless of its ease, just so we’re all on the same page. That’s why more than a quarter of us will complete our online purchase if the retailer has a clear return policy on the site.
The evolution of the Canadian shopper is far from over. Canadians have become adept at using multiple channels to not only shop but to also compare the experiences different retailers offer. Our expectations aren’t so much climbing as skyrocketing. Stay tuned for our follow-up story on how Canadian shoppers are poised to shape the future of retail in Canada.
If you want to learn more about the services and research in this article, check out the following links.
Sign up for Canada Post’s free FlexDelivery service
Track your parcel at canadapost.ca
Download Canada Post’s white paper, Is the Price Right
Download Canada Post’s white paper, Growing E-commerce in Canada
*Source: eMarketer report: August 2016
All other stats and findings: Canada Post internal research