Jamie MacDonald - Director of International Sales for Canada Post
While e-commerce in the U.S. reaches a stage of maturity and online sales stabilize, Canada is expected to see consistently higher e-commerce growth – especially this year and into 2019.1. Canadians shop more online, they increasingly turn to their neighbor to the south. Last year, 67 percent of our e-commerce shoppers bought from U.S. merchants. That’s 23 percent more than in 2016. How often do they shop? Six times each, on average. And, according to Canada Post’s 2018 Canadian Online Shopper Study, 65 percent of Canadian e-commerce shoppers are planning on buying just as much, if not more, in 2018.
If you haven’t yet had the opportunity to plan your strategy for connecting with Canadian e-commerce shoppers, stay awhile. We have the insights. Read on to discover everything you need to know about cross-border growth.
Canadian e-commerce gathers speed
Every year, more Canadians shop online, and they shop more frequently. From Vancouver in the west to Moncton in the east, our enthusiasm shows no signs of slowing. As the market evolves, frequent shoppers become loyal hyper shoppers – many of them millennials. By 2021, online sales are expected to hit over CDN $94.15 billion, while the average online spend will probably grow more than 50 percent by next year.
Using 2017 data from 2,300 Canada Post e-commerce customers, we’ve identified the growth hotspots. E-commerce sales in west coast Victoria BC led the field with an increase of 37 percent. Sales to Ontarian shoppers in Kitchener, Londonand Windsor all climbed by more than 30 percent.
Plus, Canadians are the biggest cross-border online shoppers in the Americas. According to a 2016 Paypal Ipsos study, 59 percent of those surveyed shopped both at home and abroad in the previous 12 months.2
Selling to Canadians is the smart way to grow a resilient business
Here are just a few of the reasons why it makes sense to expand internationally by selling into an economically stable and trusted market:
It’s easier to build relationships with consumers who know your brands
Not only are Canadians familiar with American brands – through advertising and bricks-and-mortar shopping trips across the border, but they actively follow your brands. This makes it easier for U.S. merchants to build relationships and generate buzz, even before opening a store north of the border.
So why are Canadianssuch international online shoppers?
- Better availability (35%)
- An appealing offer (34%)
- Better conditions, like service or price (25%)
- A broader range of products (21%)
- Better quality products (10%) 3
Canadian customers live close together and are easy to reach
Although Canada is one of the largest countries in the world, most of us live in dense concentrations within 100 miles of the border. As the country’s national postal service, we are one of Canada’s most trusted heritage brands – and the only carrier delivering to all 15.7 million households and business addresses throughout the country. We also have shopper data to share, by category and geography.
Canadian and American shopper profiles are similar
This means you can not only tap into an additional source of revenue, but also take advantage of economies of scale. For example, you’ll have access to English speakers who are high adopters of internet and mobile – and also buy everyday products in significant numbers.
Acquiring Canadian customers
In the past few years, Canada Post has commissioned ethnographic, neuroscientific and generational research to dig deep into how people connect, interact and act on marketing messages at all of life’s stages. These studies reveal the effectiveness of direct mail in driving action and spotlight the intimacy of ritual, the impact of physicality and the power of data-driven relevance. They also spotlight the effectiveness of an integrated, properly sequenced campaign, using mail to prime other media. Direct mail is a compelling way to make email and other digital communications better recognized and received. Canada Post’s Smartmail Marketing™ solutions take all these considerations into account. It’s the scientific way to connect with Canadian consumers on their path to purchase:
- 64% of recipients will visit a website in response to a piece of direct mail
- 43% of recipients ordered a product online because they received a direct mail piece
The power of the home address
So, how do you find Canadian consumers who behave like your best customers at home? How do you reach those people who shop in the category you’re selling? The Canadian postal code is a powerful thing. It’s our version of the zip code, containing significantly rich data on groups of about 20 households – providing you with the insight you need to acquire customers. Postal code data helps you target new customers in Canada with confidence, so you know you’re getting to the right people.
Respectful, intelligent targeting
This Statistics Canada Census data, along with other rich information sources,helps us characterize the type of customer who lives in an area within a neighborhood. And, although we have more privacy restrictions in Canada, they don’t apply to postal codes. So, you can use respectful, intelligent targeting to connect groups of like-minded people with the brands they’ll love.
Birds of a feather
To find look-alikes, you can select and test postal codes that intuitively align with the characteristics of your best customers – using your current data to identify the lifestyle similarities you want to find and pursue. By applying precise data that reflects the Canadian marketplace, you can create a portfolio of marketing solutions that perfectly align with the needs of Canadian shoppers.
To find out more about how to grow your business by marketing to Canadian online shoppers, connect with Jamie MacDonald at jamie.macdonald@canadapost.ca or learn more at canadapost.ca/gonorth. We look forward to seeing you at our presentation during MAPLE’s Fall Events (September 5-6).
1 eMarketer’s Retail and E-Commerce Sales Report, published in December 2017
2 https://www.paypalobjects.com/digitalassets/c/website/marketing/global/shared/global/media-resources/documents/passport-citation.pdf
3 Google and TSN’s Consumer Barometer report