Can the Local Canadian Store Survive the U.S. Online Bargins?

By On 29, Sep, 2010 |  In: Internet Marketing | Tags: ,  | 0

Online shopping

Reading a recent Globe and Mail article about more Canadians shopping on the Internet showed that four in 10 Canadians aged 16 and over used the Internet to spend more than $15 billion in 2009, up from the 32% who spent $12.8 billion in 2007, not so surprising, however, it was interesting to see the readers responses to the article.

People know what they want, they have taken their time and researched the various models on offer (In 2009, 52% of Canadians went online to “window shop” or research a product), they have read all the reviews and are in the buying mode looking for good deals, but finding the bargains in the USA and really cashing in, one person wrote, “Bought TWO pair of Rayban sunglasses on the internet for less than half the price of one pair in Canada.” Tough to beat that one and there were some responses claiming huge online savings, worth thousands of dollars!

Even paying extra for shipping, they are happy. “I try to shop exclusively with Canadian retailers, but more often I find the U.S pricing to be more affordable – even with duties and shipping.” A lot of people said this and are happy to wait a week for the delivery, knowing they have found a bargain.

However, beware who you ship with, seams like the larger shipping companies are really cashing in when we cross-border shop, one person posted, “NEVER SHIP ANY OF THE YOUR WEB PURCHASE USING “UPS” The brown shirt guys — THEY will rip you off and charge you $25 as handling for any duties and customs.”

With several similar responses, “Same with FedEx too..they’ll both charge you at least $30 as a service charge regardless of the value being shipped…I paid $40 for these “phantom” charges for an item that costs $20 (plus the usual customs and taxes)…”

Seams like USPS is the solution, again slower, but people are willing to wait. “USPS – United States Postal Service, ground shipping is the way to go. Much cheaper and haven’t had any complaints in service and reliability since I started using them.”

Some people are complaining about the cost and delivery times of the Canadian postal service and opting to purchase from American online stores using USPS, which is concerning.

Obviously the HST took a beating, some people even shopping out of province to find a bargain and getting free shipping to incentivize them into making that online purchase. There are the faithful few who keep their hard earned dollars in Canada, but even they have their complaints, “I just wish more Canadian retailers would get on-line!”

How Does the Local Canadian Store Survive?

The local store may not win in the price war, but they will always win with impulse and convenience, as their products are available now and a short drive away. The biggest issue is most of these smaller stores either don’t have a website or their website is horribly outdated and the latest hot item that everyone is looking for they have in stock, but not on their website, so it can’t be found by the search engines and can’t be found by a searching customer who is ready to buy.
When people use a product or service plus a town/city in the search term, eg. plumber in Toronto or custom fit blue jeans Mississauga, they are ready to purchase that product or book that service, but a lot of businesses haven’t realized that their websites aren’t optimized using local SEO strategies and are missing out on a ton of online opportunities.

With over 80% of Canada online today, what will this do to the bricks and mortar retail chains and local stores and contractors in Canada over the coming years?

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