Canadian Online Retail Should Pass $1 Billion

Canadian consumers should spend at least $1.4 billion online in 1999, according to a study by J.C. Williams Group that surveyed Internet users on their e-shopping and buying behavior.

The survey was sponsored by Microforum, Cadillac Fairview Corp., HMV.com, and VISA Canada, and was administered by Greenfield Online.

As part of the survey, Internet users were asked to rate various retail formats, including online shopping, smaller street-front locations, mail order, large shopping centers, big box retail, smaller strip malls, and television shopping on their ability to deliver selection, convenience, shopping environment, price, and service.

“Overall, we’ve found that active Internet users rate the online shopping experience highly for almost all aspects surveyed,” said Jim Okamura, Senior Partner at J.C Williams Group. “E-shopping was rated the highest convenience, proving Canadian Internet users are becoming more aware of the benefits this channel can offer.”

In contrast to Internet shopping, large shopping centers were leaders in selection and were rated second overall among the retail formats. The days of the shopping mall are far from over in Canada. The high marks given to shopping centers means they will remain a strong force on the Canadian retail scene, said Dominick Bovalino, VP of Cadillac Fairview, a commercial real estate developer.

Approximately 30 retail categories were included in the survey, ranging from apparel and appliances to travel and toys. Music was among the most successful categories selling online, with 14.5 percent of all Canadian Internet users buying music online within the past six months, representing 6 percent of total online sales.

The online shopping channel as a whole continues to hold potential, the study found. More than one-quarter (27 percent) of Internet users purchased merchandise and/or services online between March and August 1999. This percentage is even higher among active Internet users (those who go online eight or more hours per month), with 42 percent purchasing online. It is estimated that 34 percent of active users had not shopped online, and another 25 percent had shopped online but made purchases offline.

The study “retail.ca: Connecting with Canadian E-Shoppers” is based on a survey of 2,000 Canadian Internet users age 16 and over, which was weighted to be nationally representative of the Canadian Internet user population.