From a retail marketing perspective, it’s important for retailers to understand there can be widely varied online shopping behaviours within a city.
The percentage of online shoppers can be quite different in one part of a city from another. Even at the product level there can be huge differences in what customers prefer to buy from one neighbourhood to the next.
So having that information is critical for retailers in making decisions of what products to sell and even where brick and mortar locations should operate – and what that physical store experience will look like.
ClickSpend, powered by the J.C. Williams Group, is an essential new resource for retailers that reveals which products consumers prefer to buy online. But it also reveals differences within cities themselves and what products consumers are buying in those markets – and where.
A recent retail report by ClickSpend and Environics Analytics indicates there can be major differences in the concentration of online shoppers even within a specific market area.
“Absolutely. Take an example like Toronto. There’s certain types of categories where ecommerce is strong in certain segments of the city,” said Michele Sexsmith, Senior Vice President and Practice Leader with Environics.
“There’s 14 different categories of expenditures that we’ve been able to provide the online and the offline spend. And there’s a lot of variability between those individual categories.”
There’s no doubt the trend in the retail industry in recent years is for ecommerce sales increasing as a percentage of total retail sales. And ClickSpend has also found that there’s a great deal of variability across the country between different cities.
But it has also found that variability within those cities as well.
Why is that important? Can it give retailers information on where online shoppers are more likely to live in a city?
“It totally depends on the category,” said Sexsmith. “So if we look at something like electronics we’ll see that the suburbs are surprisingly strong for ecommerce whereas looking at another category of expenditure can be more of a bricks and mortar type shopper in those areas. It totally depends on the category of goods and whether one part of the city is going to be high or low.”
So how do retailers adapt to that data in terms of their physical stores, knowing where the online shoppers are located and what they’re buying? How can they use that data for their physical stores?
“If they’ve got an existing physical store that’s located in an area that has a lot of ecommerce activity for their category they’re going to need to change that experience within the stores. So they’re starting to experiment with these types of things. It’s those areas that would be the perfect pilot areas in order to start testing all these experiential types of retail,” explained Sexsmith.
“They need to change that retail store to provide that reason for that shopper to come in and understand the brand, to take advantage of what that store staff knows about all the products and services – things they wouldn’t be able to get purely from looking at their websites. These are the areas that are primed for getting that deeper dive and understanding more about and testing new concepts in order to get ecommerce buyers coming back into those stores and also personalizing that experience at that store level that’s going to be highly relevant for the future.”
She said this is really the only database in Canada that provides this comprehensive perspective on the market. It’s the gold standard in terms of methods in understanding potential in this retail environment where Amazon is continually taking a bigger piece of the pie.
“It gives retailers that insight and perspective to be able to understand what’s happening in their local area and to understand why store performance is changing year over year,” added Sexsmith.
According to the most recent Statistics Canada report, retail ecommerce sales reached $2.3 billion in November, accounting for 4.2 per cent of total retail trade. On a year-over-year basis, retail ecommerce increased 20.1 per cent, while total unadjusted retail sales rose 1.1 per cent.
