Opening hours? Online stores never close. More and more of us are doing our window-shopping and buying on the net

SUSAN SCHWARTZ
The Montreal Gazette
Monday, December 05, 2005

Online, the stores are always open. There are no stressed-out holiday shoppers in virtual aisles, no loops of Christmas songs playing endlessly.

During the 2004 holiday season, more than 3.5 million Canadian adults bought at least one gift online - mainly books, clothes, DVDs and movies - up hugely from 2.2 million the previous year, according to Ipsos-Reid, the Canadian public opinion and marketing research company.

And more and more Canadians are window-shopping online, using the Internet to browse in online catalogues and to comparison shop.

At the website for Chapters and Indigo book stores (chaptersindigo.ca), for instance, online sales were $19.5 million in the second quarter this year, up more than 40 per cent over the same period last year.

In 2003, the most recent year for which Statistics Canada figures are available, 4.9 million households used the Internet to buy or to make buying decisions. That's more than 40 per cent of households.

People in about 3.2 million of those households actually placed orders online, 400,000 more than the previous year. All told, they spent $3 billion - up from $2.4 billion in 2002 - mostly at Canadian sites, for products ranging from DVDs to airplane tickets. That is still a fraction of total retail sales, but it represents a 25-per-cent increase from 2002.

Visa Canada is forecasting a blockbuster holiday season online - with a sales volume of more than $2.7 billion, up from $1.5 billion in 2004. Sarah Jane Gunter, manager of Amazon.ca, says this is turning out to be "the best holiday season ever" for the online bookstore. And in the United States, where the Commerce Department reported healthy online retail sales in the third quarter, industry analysts project soaring holiday online sales as well.

They tie their predictions to several factors, including a greater variety of products, more free-shipping promotions, improved consumer confidence in online transactions and better customer service. There are gift guides and gift registries, for instance, so people can create online wish lists. Some online retailers offer gift-wrapping and direct delivery of gifts to their ultimate destination within a few days.

But Peter Woolford, vice-president of policy development and research at the Retail Council of Canada, the industry association for 9,000 Canadian retailers, says online shopping has not caught on in this country the way it has in the United States. The practice of distance shopping "has never been quite the phenomenon in Canada as in the U.S. And online shopping is a version of distance shopping ... Canadians seem to like to see the goods, feel them, touch the goods, make sure the colour is right, get some help," he said.

According to Statistics Canada's household Internet use survey of 2003, reading materials were the most common online purchases; DVDs and software also sold well. "Our guess is that these are known quantities - a bestseller, software for the home office, the latest movie - and so there is less concern," Woolford said.

Besides, he said, even though online shopping is growing in popularity, "it still accounts for a tiny percentage of all retail sales." So, even though growth rates are in the double digits, the base is so small that it is still only "a relatively small chunk of the market - and we think it will be like that for some years."

Michael Lichter runs KlinQ (www.klinq.com), a Montreal-based company that sells barware and tableware. More than 99 per cent of his business is with customers in the U.S.

"Canada has a nice percentage of people using the Internet," Lichter said. "But as I see it, people in Canada are afraid of the border and duties and taxes."

The number of Canadian retail websites has increased in the past few years, and most major stores have online outlets, so that Canadians who don't live anywhere near a Chapters or a Future Shop, say, can shop at one if they have a good Internet connection.

Convenience notwithstanding, online shopping will never take the place of in-store shopping - too many of us like it too much.

But it is becoming simpler for merchants and small businesses to develop an online presence, said Brian Green, senior vice-president of marketing at Moneris Solutions, Canada's largest processor of debit card and credit card transactions.

"Customers were calling to find out if we had this game or that game," said Karl Bernard, co-owner of Game Buzz, a downtown Montreal store that sells video games, computer games and accessories. So in June, he and partner Francois Carrier launched a website (www.gamebuzz.ca).

"Once we had a system in place, the next step was to try to drive Canadian customers to our website."

For now, online orders still make up only a small percentage of the business at the store on Ste. Catherine St. W. Of the 200 orders a month Game Buzz gets online, 25 per cent come from within Quebec, 60 per cent from the rest of Canada and 15 per cent from outside the country.

At Canadian Tire, the website (www.canadiantire.ca) is profitable and sales are increasing, said Lisa Gibson, manager of media and public relations, but customers tend to use the site as a research tool - and the store-locator feature to find out which store has stock.

Green of Moneris believes that, increasingly, Canadians will go online as a first step in shopping. "I think we have already advanced to a meaningful level of relying on the Internet for our day-to-day research needs," he said.

There are some items "you don't have to touch and feel," said Clark Johannson, president and CEO of shoptoit.ca, a Canadian online comparison-shopping site - a kind of shopping search engine that permits consumers to filter by product features, to compare prices and options among products. Say you're looking for a hand blender and you want a model that crushes ice: there are 30 different blenders on his site.

Clothing is a category some people are prepared to buy sight unseen, if they're familiar with the quality of a brand, Johannson said. Clothing is the No. 2 category people click on at shoptoit. The No. 1 category is electronics, and within that category televisions are the top item.

When Canadians are browsing online, including the word Canada at the end of the search for listings narrows the field of a search, Johannson said. And buying locally saves on customs, duty and shipping costs, and can lessen concerns about warranties and returns.

sschwartz@thegazette.canwest.com

© The Gazette (Montreal) 2005