On­line shop­ping a grow­ing part of Christ­mas ex­pe­ri­ence

But there’s as yet still plenty of room for tra­di­tional brick-and-mor­tar re­tail­ers, say ex­perts crunch­ing the num­bers

The Woolwich Observer - - VENTURE - FAISAL ALI

WHETHER YOU’VE AL­READY GOT some­thing for ev­ery­one on your list or you’re a last-minute shop­per, there’s a grow­ing chance on­line pur­chases are part of the mix.

On­line shop­ping is on the rise in Canada, and it’s rad­i­cally chang­ing the way con­sumers en­gage with re­tail­ers, sug­gests an up­com­ing study by KPMG LLP, a tax and au­dit­ing ad­vi­sory firm.

“Tech­no­log­i­cal dis­rup­tion has fun­da­men­tally changed the re­tail ex­pe­ri­ence, but many Cana­dian re­tail­ers are still play­ing catch up,” said KPMG’S Willy Kruh in a re­port re­leased this week.

“Re­tail­ers to­day not only have to com­pete with fierce e-com­merce com­peti­tors, in­clud­ing large global plat­form com­pa­nies, but also re­spond to rapidly shift­ing shop­ping ex­pec­ta­tions driven by new tech­nolo­gies and de­mo­graphic changes. Recog­ni­tion is only half­way to do­ing some­thing, and too many Cana­dian re­tail­ers are not keep­ing pace with the fact that con­sumers and their shop­ping habits are un­der­go­ing a sea-change.”

The num­bers alone paint a con­vinc­ing pic­ture. Ac­cord­ing to Sta­tis­tics Canada, in 2017 e-com­merce sales in the fi­nal two months of the year topped $3.8 bil­lion – a 20 per cent jump from the year be­fore. How­ever, that amount still paled in com­par­i­son to con­ven­tional re­tail dur­ing the Christ­mas sea­son, which went in ex­cess of $100-bil­lion in those same two months.

“We cer­tainly have been see­ing the rise of on­line over the last num­ber of years,” noted Brad Davis, as­so­ciate pro­fes­sor of mar­ket­ing at Wil­frid Lau­rier Univer­sity’s Lazaridis School of Busi­ness & Eco­nom­ics. “It’s much fur­ther de­vel­oped in the U.S. Part of what’s hold­ing it back in Canada is in the U.S. there are a lot of small- and medium-size busi­nesses that of­fer on­line shop­ping be­cause they have greater pop­u­la­tion den­si­ties, so it’s just lo­gis­ti­cally pos­si­ble. Whereas in Canada, it’s less so.”

That ob­ser­va­tion is echoed by KPMG, which says that while Cana­di­ans are steadily em­brac­ing on­line shop­ping, they are also less trust­ing with their per­sonal in­for­ma­tion on the in­ter­net, more leery of mis­use of their pri­vate data, and are slower to adopt tech­nol­ogy than their coun­ter­parts else­where in the in­dus­tri­al­ized world.

A sur­vey by the com­pany found that 46 per cent of re­spon­dents said they were con­cerned about unau­tho­rized track­ing of their habits on­line, while 64 per cent said they did not trust be­haviourally-tracked ads. In con­trast, only six per cent of re­spon­dents said they trusted re­tail­ers with their in­for­ma­tion.

“Com­pa­nies must be­gin to ap­pre­ci­ate that the mod­ern cus­tomer is highly aware of the worst ways in which their data can be mis­used,” said KPMG’s Kruh. “From hack­ing to un­war­ranted tracked ad­ver­tis­ing, cus­tomer are rightly wor­ried. Trans­parency and bet­ter com­mu­ni­ca­tion will go a long way to re­as­sur­ing cus­tomers that their data is in safe hands and that it is be­ing used in their ben­e­fit.”

But data an­a­lyt­ics can still pro­vide re­tail­ers of any size with valu­able in­sights into their cos­tomers – an ad­van­tage of on­line re­tail­ing that busi­nesses shouldn’t ig­nore.

“Par­tic­u­larly very im­por­tant [is that] you can build data­bases of who your cus­tomers are and then you can tar­get spe­cific mes­sages to them, spe­cific deals, etc. So there is also a lot of ben­e­fit to hav­ing that kind of on­line ca­pac­ity,” said Davis.

Less clear cut, how­ever, is the ad­van­tages of so­cial me­dia. Even with the rise of gen­er­a­tion selfie, 42 per cent of Cana­di­ans sur­veyed by KPMG found a brand’s so­cial me­dia pres­ence to be unim­por­tant – 11 per cent higher than global con­sumers sur­veyed. Still, half of re­spon­dents changed their tunes, some­what, say­ing they would re­act pos­i­tively if they were of­fered deals and dis­counts through so­cial me­dia.

“Cer­tainly mil­len­ni­als or un­der-35s are en­gaged dra­mat­i­cally on so­cial me­dia con­stantly. So there’s a huge, huge group there that you can try to reach,” said Davis. “The flip side is [you have] some of th­ese re­ally large com­pa­nies who are in­vest­ing heav­ily in so­cial me­dia, and they don’t quite know why they do it other than ev­ery­body else is, and that’s where ev­ery­body is now.”

It’s a tech­nol­ogy that even the big com­pa­nies are still un­sure how to use, says Davis, while many are still re­ly­ing on the old mod­els of tele­vi­sion and me­dia ad­ver­tis­ing, and adapt­ing it to the new fo­rum.

The up­shot is that tra­di­tional stores aren’t go­ing any­where just yet.

“Con­sumers still like the tac­tile ex­pe­ri­ence in shop­ping,” said Davis. “In a lot of cases, they like to see it and shake it and take a look at it, phys­i­cally feel it. There’s a so­cial com­po­nent to bricks-and-mor­tar. Just get­ting out there, either go­ing out with friends or just go­ing out and in­ter­act­ing in that en­vi­ron­ment. We’re a so­cial species so we need that in­ter­ac­tion.”

But the ideal state for re­tail­ers might lie some­where in be­tween the tra­di­tional and con­tem­po­rary mod­els – a hy­bridiza­tion of on­line and in-per­son ex­pe­ri­ences.

“A num­ber of com­pa­nies that started solely on­line are now be­gin­ning to in­tro­duce phys­i­cal ‘show­rooms’ to of­fer vir­tual-phys­i­cal ex­pe­ri­ences for cus­tomers,” notes KPMG. “For in­stance, some play­ers in the

than food?

Space re­search has ad­vanced with the help of th­ese labs and other univer­sity and gov­ern­ment labs around the world. Canada has pro­duced big­name as­tro­nauts – among them, Guelph grad­u­ate Roberta Bod­nar, gover­nor gen­eral Julie Payette, fed­eral min­is­ter of trans­port Marc Garneau, “as­tro-troubador” Chris Had­field and Bob Thirsk, to name a few.

Join­ing their ranks Mon­day was as­tro­naut David Saint-Jac­ques of the Cana­dian Space Agency, who left on a mission to the In­ter­na­tional Space Sta­tion, where as­tro­nauts are work­ing to­gether to ad­vance space travel. At least 200 ex­per­i­ments are be­ing con- ducted there at any time.

One such pro­ject is closely con­nected to one of Dixon’s stu­dents, en­vi­ron­men­tal science ma­jor Con­nor Kiselchuk.

Kiselchuk was in­tro­duced to space travel in his third year as a U of Guelph stu­dent, when he heard Cana­dian as­tro­naut Thirsk speak on cam­pus about To­mato­sphere. It’s a pro­gram Guelph helped launch to put tomato seeds in space, then dis­trib­ute them to schools where they’re grown to see if space travel changed their abil­ity to ger­mi­nate.

He ap­proached To­mato­sphere sci­en­tific di­rec­tor Dixon for a vol­un­teer spot in his lab. In one year, Kiselchuk ded­i­cated 250 hours to learn­ing how to grow plants in con­trolled en­vi­ron­ments.

His en­thu­si­asm and tal­ent paid off quickly. In 2017, he won the Jeff Schell Fel­low­ship from Bayer Crop Science, which he served over eight months at DLR (Ger­man Space Agency) in Bre­men. There, he was part of an in­ter­na­tional team that de­signed, built, tested and de­ployed a self-suf­fi­cient green­house to the Neu­mayer-III re­search sta­tion in Antarc­tica – where it re­mains to­day, pro­duc­ing fresh food for the over­win­ter­ing crew.

And then came the big prize: a four-month place­ment at the NASA Kennedy Space Cen­ter, as part of the on-or­bit plant pro­duc­tion team. There, he worked as what’s called a “pseudo­naut,” some­one who mir­rors on Earth the ex­per­i­ments that an as­tro­naut would do in space.

In Kiselchuk’s case, the ex­per­i­ment was work­ing on fer­til­izer re­quire­ments and op­ti­mum light re­quire­ments for grow­ing plants in space.

Last month was a pin­na­cle for him, when his plants were ger­mi­nated on the in­ter­na­tional space sta­tion’s or­bital green­house. There, as­tro­naut Ser­ena Aunon-Chan­cel­lor of the U.S. and Ger­man as­tro­naut Alexan­der Gerst are grow­ing Dra­goon let­tuce and Red Rus­sian Kale, cho­sen specif­i­cally for their re­spec­tive con­cen­tra­tion in B vi­ta­mins and other com­pounds which have been known to be lack­ing in as­tro­nauts’ cur­rent prepack­aged diet.

“The feed­back I get is that grow­ing plants on the space sta­tion is one of their favourite things to do,” says Kiselchuk, who hopes to en­ter a Master’s pro­gram in 2019. “As­tro­nauts jockey for the job to grow plants … it helps their mood see­ing some­thing green, car­ing for an­other or­gan­ism, it’s like hor­ti­cul­tural ther­apy.”

E-com­merce sales grew sales grew more than 25 per cent in 2017 over the pre­vi­ous year, but still rep­re­sented only a frac­tion of tra­di­tional re­tail­ing.

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