Is the Canadian Puzzle Solvable?
Canadians are so put off by shipping charges that Hudson’s Bay Co., one of the country’s largest multichannel retailers, has found that 80 percent of its direct marketing customers would rather have orders shipped to local stores than to their homes in order to save on shipping charges.
Canadians Prefer ‘Low-risk’ Products
It can be as tricky to gauge Canadians’ shopping behavior as it is to find them in the first place (I’ll touch on Canadian lists in a moment). Jim Okamura, senior partner with the Chicago-based consulting and research firm J.C. Williams Group, said during the conference that Canadians prefer low-risk products, such as computer hardware. They lag in online shopping penetration with home furnishings, food and pet supplies, among others, and lack the consistent penetration of American consumers when it comes to shopping direct.
Another key pain point for American multichannel merchants marketing in Canada is the high cost of postage. You think you have it bad in the U.S.? Canadian postal rates for catalogs is approximately double.
Bad Prospect Lists
What’s more, another key hindrance is the historic lack of direct response lists in Canada. Plenty of prospecting lists have totally bombed for U.S. mailers due to a lack of direct response history on most names.
In addition, Canadian consumers don’t do a whole lot of their shopping in non-retail channels. An NPD Group-Canada Post survey released last month showed that among those Canadian shoppers surveyed, an overwhelming majority of them shop in stores, compared to catalog and online.
* Among those who purchased apparel, 91 percent bought at retail; 18 percent bought through catalogs and 11 percent bought online.
* Among those who bought shoes, 79 percent bought them in stores, 7 percent bought them through catalogs and 5 percent purchased then online.
* In health and beauty products, 73 percent said they bought at retail, 12 percent through catalogs and 8 percent online.
