In Canada, the grocery channel, which used to be known as “the last hurdle for e-commerce,” is now driving e-commerce innovation, both in customer experience and service excellence. At the recent annual Retail Council of Canada’s Store 2017 conference in Toronto, Ontario, Carman Allison, vice president of consumer insights at Nielsen, hosted a roundtable exploring the opportunities available from e-commerce grocery innovation.
Digital, e-commerce and retail operations leaders across the Canadian retail industry joined Carman to discuss how online and digital shopping is creating new and exciting touch points along the shopper journey. And innovations are pushing retailers and manufacturers to think outside of their own categories to realize growth opportunities across the total store.
Today, online shopping in Canada represents just 1.9% of fast-moving consumer goods (FMCG) purchases; however, our analysis projects this number to triple by 2020 to 5.3% representing approximately CA$6 billion in consumer spending. We also anticipate that FMCG e-commerce sales will outpace brick-and-mortar sales growth by a margin of seven to one in Canada. This is despite the fact that online consumers are more focused, purchasing products from only 1.5 departments per trip on-average, compared with three departments when in physical stores.
During the roundtable, Carman and the panelists addressed that even though e-commerce is small today, it’s already instrumental to growth across most categories. Currently, non-food categories are leading e-commerce growth versus their brick and mortar counterparts, specifically with baby care (59% vs. -3%), over-the-counter medicines (35% vs. 1%), pet care (34% vs -3%) and paper products (32% vs. 2%). However, the food category rounds out the top five with 20% online growth versus a decrease of 1% within brick-and-mortar.
“Despite seeing an overall decline in traffic, brick-and-mortar retailers have more opportunities to engage and interact with consumers,” said Carman during the roundtable discussion.
The key to reaching consumers through e-commerce? Digital technologies. These tools are condensing consumers’ path to purchase and enabling frictionless interactions across channels, platforms and screens. But as the roundtable participants noted, when technology is influencing what consumers are buying, the brand experience is more important than ever, as are the consumer insights needed to make strategic and impactful business decisions.
Photo credit: Retail Council of Canada.