Digital Commerce Continues to Surge in Canadian Retail Marketplace: Study

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By Mario Toneguzzi

Canadian digital commerce continues to be a very healthy segment of the retail marketplace with the use of mobile devices becoming increasingly more popular to facilitate consumer purchases.

The 2019 Q1 Shopping Index Report by Salesforce found that Canadian digital commerce in the first quarter of this year grew 18 per cent year over year, seeing the third most digital growth globally.

Also, 39 per cent of Canadian digital shoppers in Q1 placed an order using a mobile device, slightly above the global average of 34 per cent.

Rob Garf, Vice President of Industry Strategy and Insights at Salesforce Retail, said the Canadian digital commerce growth outpaced the global average of 12 per cent.

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“Canadian shoppers are not just browsing but buying via mobile,” he said. “Mobile growth continues to surge . . . Mobile is the remote control of our daily lives. It really is the thread that weaves together the digital and physical shopping for most consumers.”

Garf said 45 per cent of Canadian digital shoppers in the first quarter placed an order on a computer.

“There’s been a shift (to mobile). It’s significant (over the past few years). It was nearly nothing as recently as five years ago. If you want to think about what retailers have done to make the shopping experience more seamless, and really break down the friction that has existed, it really has led to mobile adoption for both browsing and buying,” he said.

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 “The way I see it and how we’ve observed it, primarily from our customers, let’s face it, retailers made it really difficult to purchase via mobile for many years. It was very clunky. The user experience was not that intuitive and the checkout was very difficult. So the time from inspiration where a consumer discovered something they wanted to buy and the time they actually purchased it was not that fun of an experience. But retailers have really broken down that friction - really made it more seamless. And it’s primarily around the discovery event. Just making the user experience, the user interface, more intuitive and also the checkout mainly through digital wallets to move from what could have been a five-step checkout process to a one-step checkout process.”

Garf said the trend toward mobile will continue in the retail industry. Salesforce noticed that over the holiday season mobile was the dominant force for browsing and buying.

“We saw for the first time over the entire course of the holiday that it became mobile first for browsing and buying. So that’s really just a bellwether if you will for what’s to come in the future,” he added.

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Consumers today are extremely busy. They’re time starved and they’re looking for convenience and automation. They’re also looking for personalization. And the digital experience helps elevate that reality.

“I’m not at all stating that physical retail is dying. In fact, we’re seeing a tremendous blend between the physical and digital to the degree that digital is being infused in the physical store and that could be with the consumer themselves where more than 71 per cent of consumers use a mobile device in the physical store to learn more about products, converse with their friends, family and colleagues, or check prices,” explained Garf.

“We’re also seeing digital being infused for the store. I grew up in retail. Spent a lot of time in the stores. Store associates are I believe the biggest brand ambassador and retailers must empower them with digital so that they’re on a level playing field with the consumers who have more access and availability to information than ever before.”

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What the industry is seeing, particularly in high-touch retail, is a move from the checkout process which is all about speed and efficiency to a check in process which is all about personalization, engagement when the consumer is browsing and buying and at that moment of truth making decisions about what to actually purchase.

Garf said the continual adoption of digital by consumers is going to elevate the retail industry as a whole. For the consumer, it’s going to create more convenience, automation and personalization. For the retailer, it’s going to create more opportunity to connect to that consumer where they are and on their terms. It’s also going to enhance productivity for the retailers and the store associates.

“A big part of that is Artificial Intelligence. Artificial Intelligence has really moved from a tech buzzword to a material impact for retail. We found actually based on our Q1 shopping index that those consumers that clicked on a product recommendation driven by Artificial Intelligence had a 26 per cent higher average order value,” said Garf.

“The industry in general always talks about discounts, discounts, discounts. We actually see Artificial Intelligence as an antidote to discounts because it’s really driving that intimacy, that relevancy, providing that timeliness for the consumer, helping them make their life easier and breaking down the friction between inspiration and purchase.”

The report analyzed the habits of more than 500 million shoppers worldwide. It found that traffic grew by only two per cent but shopper spend increased by 10 per cent.

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Mario Toneguzzi, based in Calgary has 37 years of experience as a daily newspaper writer, columnist and editor. He worked for 35 years at the Calgary Herald covering sports, crime, politics, health, city and breaking news, and business. For 12 years as a business writer, his main beats were commercial and residential real estate, retail, small business and general economic news. He nows works on his own as a freelance writer and consultant in communications and media relations/training. Email: mdtoneguzzi@gmail.com

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