Canadian Retailers Adapting To E-Commerce World

Though e-commerce continues to play a significant role in the evolution of the Canadian retail sector, it is not all doom-and-gloom for traditional brick-and-mortar stores, according to a new Statistics Canada report.

The report, “Where did Vancouverites Go to Shop in 2016?: A Snapshot of Vancouver Retail Store Sales by Shopping Centre Type”, found e-commerce retail sales in Canada grew by 39.5% between 2012 and 2015.

In comparison, in-store retail sales grew by 14.2% during the same period.

“While these trends suggest a diminishing role for brick-and-mortar retailers, they do not tell the whole story,” StatsCan writes. 

The report says while e-commerce is growing faster than in-store sales, it still represented only 2.2% of all retail sales in 2016 in Canada. 

To combat this new competition, many brick-and-mortar retailers are adopting an omnichannel retail strategy, maintaining their physical storefronts while adopting an online presence. 

Conversely, some e-commerce retailers are establishing their own brick-and-mortar stores to complement their online business. 

The report also notes the trend by malls and shopping centre owners to revamp the shopping centre experience by offering more non-retail services like food and entertainment, or adopting mixed-use strategies, such as incorporating residential elements in their design. 

In its focus on Vancouver, the report found the city has a rapidly expanding retail market, driven in part by strong population growth. 

From 2004 to 2016, retail stores in the Vancouver area increased their sales from $22.2B to $36B, a rise of 62%.

During the same period, the Vancouver census metropolitan area's population grew from 2.1 million to 2.6 million, a rise of 19.4%.

“Population projections suggest that the Vancouver CMA could see a further 26.4% increase in its population in the next 20 years, which will likely increase the need for planning the location of future shopping centre developments," StatsCan writes.