TORONTO ? Shopping online was the winner this holiday retail season, according to a report that says many traditional retailers will need to up their game to avoid Amazon and eBay from siphoning away sales in the future.
“E-commerce has become a far more preferred shopping channel among Canadians as these digital platforms offer convenience and comfort for shoppers,” said the report this month from BMO Capital Markets analyst Peter Sklar, who compared share of Canadian Web visits throughout the holidays between online only retailers and bricks-and-mortar retailers with internet divisions, for example Canadian Tire and Walmart.
“E-commerce platforms of the publicly traded Canadian bricks-and-mortar retailers, such as Canadian Tire and Rona, continue to represent an immaterial share of Canadian web visits during this past holiday season in accordance with Amazon, Walmart, and eBay,” Sklar noted.
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Broader data also confirms that the holiday 2015 period was robust for online retail. November and December 2015 were record-breaking months for online sales in Canada, based on MasterCard SpendingPulse, which tracks consumer payments and estimates for credit, debit, cash and cheques. Online sales accounted for 9.7 per cent of total retail sales within the two-month period, the greatest watermark yet for Web sales in Canada. In December, online sales accounted for to 9.9 percent of total retail sales, up from 8.6 per cent in 2014.
In the meantime, overall Canadian retail sales growth, excluding automotive and gasoline, grew two per cent annually within the holidays, MasterCard noted.
To gauge the possibility future impact on sales from the Canadian bricks-and-mortar retailers, Sklar checked out Amazon’s list of top-selling items on Amazon.ca throughout the holidays.
Amazon Canada’s top sellers during the holidays were in the technology category, such as headphones, HDMI cables and tv sets, but Sklar said it is inevitable the online giant will start to encroach on the operations of legacy retailers.
Amazon’s list included items which wade in to the same territory as Canadian Tire’s product offering: automotive items such as leather care kits, household goods such as vacuum cleaners, and sports and outdoor equipment such as basketball hoops.
“Although Amazon’s current categories do not substantially overlap using the Canadian publicly owned bricks-and-mortar retailers (except apparel), because the company continues to broaden its categories, we expect that at some stage in the near future, this can possess a noticeable impact on a broader range of incumbents such as Canadian Tire,” Sklar said.
In December 2015, Amazon’s share of aggregate Web visits involved 2.7 percent compared with 2.45 per cent in December 2014, the BMO report noted. Throughout the same period, aggregate online appointments with eBay dipped to 1.2 percent from 1.6 percent in Dec. 2014, and Walmart’s aggregate online visits fell to about 0.9 percent from about 1.2 percent a year earlier.
hshaw@nationalpost.com
Twitter.com/HollieKShaw
