Canadian retailers and shopping centers are scrambling to understand how to partake in omni-channel retailing in order to meet the needs of a growing customer base who shop anytime and anywhere. Consumers are browsing/researching products online, showrooming, webrooming, posting reviews with their mobile devices, and buying online and returning in-store. For many consumers however, a seamless omni-channel retailing environment is lacking when shopping with most Canadian retailers. That is for good reason.
Setting up an omni-channel environment requires significant resources, expertise, budget, and a long-term outlook. Canadian retailers are in the early stages, determining their strategic plans and how to invest and create an omni-channel environment for their consumers.
At the Canadian Research Conference hosted by the Centre for the Study of Commercial Activity (CSCA) and the International Council of Shopping Centers (ICSC) on June 25th, two top executives shared their experiences on servicing retailers and customers in the online and omni-channel environment. Drew Green, founder, CEO, and chairman of SHOP.CA and Chloe Raincock, owner of heel boy shared their insights as part of a panel discussion.
heel boy is a Canadian specialty shoe retailer. Starting out in Kingston with one store in 1998, Chloe grew the business to four stores, including one in the renowned Distillery District in Toronto. Like many small and mid-sized Canadian retailers, she faced critical questions on how to expand her business amidst a changing consumer landscape. However, as Chloe put it they wanted to “be competitive in the present and relevant in the future.” To do so she knew she had to adapt, and SHOP.CA was an ideal partnership to help further heel boy’s success.
SHOP.CA is a Canadian online marketplace that works with retailers to setup the e-commerce leg of their business. For retailers, an advantage of any online marketplace is access to an aggregated consumer base that they can serve; however, there are other advantages that go far beyond that. Aggregated consumer insights, superior technology investments (well over what individual retailers can afford), marketing reach, online marketing expertise, and a cohesive consumer experience are additional benefits that online marketplaces offer. Some online marketplaces, like Amazon, are a dual-edged sword. Amazon provides a solid platform and services for retailers with millions of customers to sell to; however, competition is high on the platform and Amazon itself gains insights into retailers’ sales and consumer history, which is used not only to improve the overall shopping experience, but to sell their own private-label products (e.g., Denali Tools, Pinzon: Home & Kitchen, etc.)
A few key learnings from the panel session included:
- For Canadian retailers, partnerships with service providers and experts are crucial for success online. To build up a great online Canadian economy there must be a long-term vision on both sides. Mature online retailing countries like the U.S. and the U.K. were built on solid partnerships where both parties assumed the risk and benefited from the large returns.
- “Last mile in this country is increasingly important”—Drew Green. Consumers want to pick up items in-store, especially if it means they can get it faster. Whether they are picking up at their local post office, at their local retailer or their shopping center, the “last mile” is an opportunity that many retail partners and retailers have yet to discover.
- Driving traffic online is the top priority for online stores. The top two channels for driving demand for retailers are SEM, dominated by Google, and online marketplaces. Retailers must consider the multiple online opportunities for driving traffic as part of their overall strategy.
The two panelists had a dearth of other information and experience to share. Some nuggets include the following:
- A surprising 60% of site visitors at SHOP.CA are males.
- Repeat customers come back on average 5 times per year for SHOP.CA, illustrating the pent-up demand amongst Canadians for great local shopping.
- heel boy’s strategic decision to partner instead of building an e-commerce platform in-house was due to several reasons including: (a) a lack of intimate understanding of online technology platforms, (b) understanding that marketing the brand would be a difficult task in the competitive environment online, and (c) to create a competitive online shopping experience would require huge investments and resources that smaller retailers cannot always afford.
- 65% of SHOP.CA’s 2,200 stores have their own e-commerce business but these retailers are also using an online marketplace; for others they provide the e-commerce operational stack from end to end.
- A Canadian online challenge turned opportunity for SHOP.CA includes transparency, providing Canadian customers with transparent pricing (e.g., including customs/duty, shipping, etc.).
- The majority of SHOP.CA’s traffic comes from partnerships (e.g., Aeroplan) and there is less emphasis on Google marketing (i.e., ads).
For more information on the panelists or the session, please contact: firstname.lastname@example.org.
SHOP.CA was launched in July 2012 as Canada’s first online marketplace. Before founding the company Drew Green (founder & CEO) identified that Canadian consumers were forced to shop on U.S. sites as a result of retailers and entrepreneurs not investing in the types of e-commerce experiences needed to keep consumers shopping in Canada, when they shop online. With this conclusion, SHOP.CA was created to fill this gap and to help retailers be successful online, through a marketplace built for Canadian retailers, distributors and brands, therefore offering a more consistent and cohesive consumer experience for Canadians.
Today the marketplace has over 2,000 stores and over 10,000 brands. Its primary function for merchants is to provide a marketplace platform, on a cost per order basis, helping to drive sales at scale and at a price that retailers would be otherwise unable to afford on their own, and a wealth of consumer traffic in one location to help build a retailer’s online business. SHOP.CA’s technology platform was built in partnership with IBM and continues to be innovated through an in-house development team. Additional services provide the expertise that many retailers find difficult to acquire in Canada or cannot afford to hire for internally. For example, SHOP.CA works with its retailers to educate them on content, pricing strategies, digital marketing, and fulfilment excellence. They act as an extension of their merchant partner’s team to ensure the retailer is successful online.
SHOP.CA is a direct competitor of Amazon; however, they are distinct in two ways. First, they are purely focused on the Canadian consumer and secondly, they do not act as a competitor to retailers (e.g., do not sell private-label products). This provides an advantage to Canadian retailers that join the marketplace who do not want to risk their competitive product and customer data and create a new competitor in the form of their online marketplace (e.g., Amazon). For more information and to shop online, please visit www.shop.ca.
About heel boy
Founded in 1998 in Kingston, Ontario, heel boy has been offering a unique shoe shopping experience for 16 years. Owned and operated by Chloe Raincock, heel boy offers something for everyone. From a girls’ (or boys’) night out, to a rainy spring morning with the kids in the park, to a power lunch with the boss, customers can find a shoe right for every occasion at heel boy. With stores located on Queen Street West and the Distillery District in Toronto as well as in Kingston and Waterloo, heel boy’s dedicated sales staff will help solve even the trickiest shoe dilemma. For more information and to shop online, please visit www.heelboy.com.