BIG PICTURE

REMEMBER THE HYPE THAT EXISTED OVER EVERYTHING INTERNET BEFORE THE DOT COM BUBBLE BURST? IN 1998, FOR EXAMPLE, FORMER PRO WRESTLER JESSE VENTURA WAS ACTUALLY CONSIDERED A REVOLUTIONARY POLITICIAN FOR SIMPLY DEPLOYING INTERACTIVE WEBSITES WHILE CAMPAIGNING

Growth in business-to-consumer e-commerce is tailing off.

But agoraphobia didn’t light a fire under the business-to-consumer (B2C) e-commerce market. Despite the spectacular stock market gains that followed the dotcom meltdown, online B2C sales worldwide didn’t top the US$1- trillion mark until 2012. Since then, growth has been relatively impressive. Worldwide B2C sales increased 14% to US$1.5 trillion in 2014, according to eMarketer (which defines B2C e-commerce as all products and services ordered or booked via the Internet on any device, including leisure and unmanaged business travel). The United States and China were the world’s top performing e-commerce markets, posting online consumer sales worth US$449 billion and US$265 billion, respectively, followed by the United Kingdom ( US$115 billion), Japan ( US$115 billion), Germany ( US$79 billion) and France ( US$48 billion). The Canadian market ranked seventh after growing an estimated 14% to US$34 billion. Canadian and American consumers have an equal appetite for e-commerce, says eMarketer analyst Paul Briggs, but the online experience in this country has lagged. “Things have changed in the last 18 months,” he says, noting heavy investments made by Amazon have forced domestic retailers to innovate.

Eight of 10 Internet users in Canada shopped online between September 2013 and September 2014, spending about $1,000 on average, according to a 2014 Ipsos Reid survey. Connected consumers aged 18-34 were the most active, with 92% of them purchasing online, followed by the 35-to-54 group (82%) and the 55-or-older set (74%). The most common products bought were cosmetics and beauty products (29% of all reported purchases), furniture and housewares (23%), pet products (17%) and groceries (15%). Amazon was the most popular retailer, accounting for almost a quarter of total purchases. Despite the popularity of smartphones and tablets, PCs still ruled the market, accounting for 88% of total computer-based purchases.

The growth of e-commerce will likely slow as Internet usage continues to mature. However, total sales are still expected to top US$2 trillion by 2017, and then grow by at least US$200 billion annually. E-commerce may not have lived up to its early hype, but astronomer Clifford Stoll was still way off when in 1995 he insisted local shopping malls would always do more business in a single afternoon than the entire Internet in a month because e-commerce lacked human contact.