retail prophet | November 22, 2011

Doug Stephens: The Dismal Present, and Bright Future, of Online Shopping

In a recent interview, Doug Stephens discussed Canada's dreadful e-commerce vacuum as well as—his favorite topic—the future of retail. As Stephens points out, 96% of Canadian households have high-speed internet access, yet only 8% of Canadian businesses do business online. This discrepancy is much higher than that of the U.S., where online shopping has completely changed the face of the retail business. (Stephens, in his role as founder of Retail Prophet, charts even the tiniest change in the retail landscape with an obsessive and clear-eyed perspective that has earned him acclaim as one of the world’s best retail futurists.)

Stephens says there are several theories that explain Canada's lack of e-commerce, but most of them simply don’t hold up. The first is that the sheer size of the country leads to prohibitively high shipping costs. However, Stephens points out that despite Canada's enormity, we are not a "heavily dispersed population" because the majority of Canadians live "within 50 miles of the U.S. border." The U.S. on the other hand has a heavily dispersed population, yet has seen e-commerce boom. The real problems may lie with smaller businesses, as well as with our retail leaders. Only eight of Canada's top 25 retailers offered online shopping compared to 16 of the top 25 in the U.S. What this all means, ultimately, is that while the current e-commerce landscape in Canada is underdeveloped, there’s a huge opportunity for growth. The future of online retail, in other words, is still very much up for grabs.