Today, there are an estimated 12-24 million e-commerce sites across the globe. Over the past decade, ecommerce activity; which encompasses buying and selling goods and services exclusively through electronic channels has grown tremendously. Thanks to the development of new and emerging technologies, more people than ever across the globe now have access to affordable electronic devices and internet connectivity.
In Canada, the ecommerce market has become particularly profitable in recent years, in which the market is expected to continue to grow at a phenomenal rate. Below, we’ll take a look at the latest ecommerce trends across Canada.
The current market size and estimated growth
In 2020, the ecommerce market in Canada was valued at $31.129 million US Dollars and with a CAGR of 8%. With a year-on-year growth rate of 23%, it is estimated that 67% of Canadian citizens currently participate in e-commerce.
Thanks to its close proximity to the US border, Canada offers an excellent opportunity for US sellers looking to expand their offering into new countries, and vice versa. With a similar tax, fees and shipping set-up, it offers the ideal opportunity for retailers to expand their businesses internationally.
It’s predicted that we can expect to see a continued CAGR of 8% for the next four years as the ecommerce market continues to gather momentum.
Which retailers are dominating the Canadian ecommerce space?
There are five categories of ecommerce under operations in Canada, consisting of:
1. Electronics and media - Accounts for 29% of overall Canadian ecommerce revenue
2. Fashion - Accounts for 26% of overall Canadian ecommerce revenue
3. Toys, hobbies and DIY - Accounts for 19% of overall Canadian ecommerce revenue
4. Furniture and appliances - Accounts for 16% of overall Canadian ecommerce revenue
5. Food and personal care - Accounts for 10% of overall Canadian ecommerce revenue
Of these categories, it’s not surprising that global giant Amazon was top of the list as the most popular ecommerce store in Canada of 2020. As such, ecommerce sales of Amazon at this time amassed to more than $1.92 Million US Dollars.
However, the most popular ecommerce store in the Fashion sector is the bay.com; an iconic department store owned by American businessman, Jerry zicker. While Zucker has had great influence over the Canadian and US fashion market, he has since closed down most European sites in order to streamline business costs.
Overall, while ecommerce has been growing at a phenomenal rate, there has been a setback in the international market over the past year due to logistical challenges. While ecommerce is an incredibly profitable and flexible industry, there are still Canadian businesses that are relatively slow to shift to the ecommerce wave. As a result, American companies have swooped in quickly to capitalize on the opportunity and provide increased convenience to consumers across North America.
What stands in store for ecommerce in Canada next, we'll have to wait and see.