State of the Canadian Retail Consumer Presented by comScore

© comScore, Inc. Proprietary.

State of the Canadian Retail

Consumer Meetup

How are Canadians Interacting with Retail Today?

Darrick Li, Account Manager | October 10, 2013

© comScore, Inc. Proprietary. 2

Agenda

• Introductions and Preface

• A little bit about

• Retail Trends

• E-Commerce Trends

• Mobile Commerce Trends

• Discussion, Discussion,

Discussion


Objectives for Today

1

2

3

Help you understand what is happening in Online Retail

today in Canada (data-backed)

Create a discussion and longer-term conversation about

some of the challenges with Online Retail in Canada

Bring some of your experiences and expertise to the

table to drive some insights for everyone

Provide an understanding of how comScore plays a role

in measuring the Online Retail space

Conclude at 7:00pm

4

5


The digital world is complex


comScore brings it together…

Tablet PC/Mac TV Smartphone Gaming

We are an internet technology company that measures what people do as they

navigate the digital world and turn that information into insights and actions

for our clients to maximize the value of their digital investments.


comScore 2 Million Person Global Panel

Comprehensive View of Digital Consumer Behavior

Online

Advertising

Video

Search

Demo-

graphic

Profiles

Online

Behavioral

Profiles

E-Commerce

Website and

App Usage

PC

Smart

phone

TV

Tablet

Gaming

POS

Server

V0113


Providing Analytics For More Than 2,100 Clients Globally

Media Agencies Telecom/Mobile Financial Retail Travel CPG Health Technology

V0113

http://www.sprint.com/

http://www.timewarnercable.com/Milwaukee/

http://images.google.com/imgres?imgurl=http://www.bargainstash.com/images/logos/target.gif&imgrefurl=http://www.bargainstash.com/&h=70&w=59&sz=3&hl=en&start=47&tbnid=ylSXIM_zSo_bCM:&tbnh=68&tbnw=57&prev=/images?q=Target+Corporation+logos&start=40&ndsp=20&svnum=10&hl=en&lr=&sa=N

http://www.carnival.com/

http://images.google.com/imgres?imgurl=http://www.kbro.com/images/W_Hotels_logo.gif&imgrefurl=http://www.kbro.com/forum.html&h=104&w=85&sz=2&hl=en&start=54&tbnid=2SFFSNI9VXQYIM:&tbnh=84&tbnw=69&prev=/images?q=W+hotels+logo&start=40&ndsp=20&svnum=10&hl=en&lr=&sa=N

http://images.google.com/imgres?imgurl=http://miami-hotels.tee-times-usa.com/images/hotels/miami/westin-diplomat-logo.jpg&imgrefurl=http://miami-hotels.tee-times-usa.com/westin-diplomat.htm&h=81&w=150&sz=4&hl=en&start=158&tbnid=N7iTlqlbsNa-oM:&tbnh=52&tbnw=96&prev=/images?q=Westin+hotels+logo&start=140&ndsp=20&svnum=10&hl=en&lr=&sa=N

http://images.google.com/imgres?imgurl=http://www.starwoodhotels.com.sg/sheraton/images_c/sheraton_chead_logo.jpg&imgrefurl=http://www.starwoodhotels.com.sg/sheraton/city_index.html?IM=CORP_HP_TL_JPDRE_Q4_JP&h=160&w=240&sz=9&hl=en&start=6&tbnid=9MeZaKLkz_EDuM:&tbnh=73&tbnw=110&prev=/images?q=sheraton+hotels+logo&svnum=10&hl=en&lr=

http://go.msn.com/AH/0/

http://images.google.com/imgres?imgurl=http://money.cnn.com/blogs/browser/uploaded_images/logo_facebook-rgb-7inch-706175.jpg&imgrefurl=http://profile.myspace.com/index.cfm?fuseaction=user.viewprofile&friendID=25325&h=385&w=1024&sz=25&hl=en&start=17&tbnid=YHvOddNaq6jV_M:&tbnh=56&tbnw=150&prev=/images?q=facebook&gbv=2&svnum=10&hl=en

http://www.cox.com/

http://welcome.hp.com/country/us/eng/welcome.html

http://www.intuit.com/

http://www.petsmart.com/ps/main.jsp?ASSORTMENT<>ast_id=2534374302023687&bmUID=1179240180487

http://www.wpp.com/wpp/

http://www.omnicomgroup.com/

http://www.cablevision.com/

© comScore, Inc. Proprietary. © comScore, Inc. Proprietary.

E-Commerce in Canada

Opening Thought


$22,308,090

$20,305,387

Dollars (000)

2011 2012

Source: comScore, Inc., Custom Reporting, CA, Person: 2+, Annual Aggregate 2012 vs. 2011

E-Commerce spend and transactions in Canada increased 10% & 17%

respectively year over year

105,372

90,016 Transactions

(000)

+10%

+17%

E-Commerce Dollars are growing at a pace of 10%

in Canada, but growing at 16% in the US – why do

you think that is happening? 1


Leading Canadian Retailers

Dx3 Whitepaper “The War of $18.12”

Are small businesses lacking the e-commerce

infrastructure that some of these larger retailers

can afford? 2


The Online Retail Category in

Canada


Visitation Snapshot on Retail in Canada

Source: comScore, Inc., Media Metrix, CA, Home & Work, Persons: 2+, 3 Mo. Avg. Ending Jun 2013

337.8M

Unique Visitors

% Reach

Total Hours

Total Pages Viewed

Total Visits

Avg. Minutes per Visit

Avg. Pages per Visit

23.5M

3.1B

5.3

29.7

83.8

9.3

© comScore, Inc. Proprietary. 13 Source: comScore, Inc., Media Metrix, CA, Home & Work, Persons: 2+, 3 Mo. Avg. Ending Jun 2013

Canadian Retail Demographic Breakdown

18.7%

11.8%

16.6% 16.3% 16.7%

20.0%

2-17 18-24 25-34 35-44 45-54 55+

8.9%

9.6%

17.0%

13.5% 17.7%

33.3%

Less than $25K

$25,000 - $39,999

$40,000 - $59,999

$60,000 - $74,999

$75,000 - $99,999

More than $100K

British

Columbia

13.6% Prairies

17.4% Ontario

40.1%

Quebec

22.3%

Atlantic

6.6%

Household Income (CAD) Region

Age

51.0% 49.0%

Gender

© comScore, Inc. Proprietary. 14 Source: comScore Inc., Media Metrix, CA, Home & Work, Persons; 2+, Jun 2012 – Jun 2013

Retail Visitation has Plateaued

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

0

5,000

10,000

15,000

20,000

25,000

30,000

To

tal V

isit

s (

00

0)

To

tal U

niq

ue

Vis

ito

rs (

00

0)

Total Unique Visitors (000) Total Visits (000)0% YoY +1% YoY

Is this reflective of your visitation to Online Retail? 3

© comScore, Inc. Proprietary. 15 Source: comScore Inc., Media Metrix, CA, Home & Work, Persons; 2+, Jun 2012 – Jun 2013

Visitation Trends within Retail in Canada by Sub-Category

10,000

20,000

30,000

40,000

50,000

60,000

To

tal V

isit

s (

00

0)

Comparison Shopping

Computer Hardware

Computer Software

Retail - Movies

Department Stores

Apparel

Consumer Electronics

Home Furnishings

Sports/Outdoor

Consumer Goods

Tickets

Health Care

Books

Jewelry/Luxury Goods/Accessories

Retail - Food

Retail - Music

Fragrances/Cosmetics

Mall

Flowers/Gifts/Greetings

-17% YoY

-19% YoY

-3% YoY

+46% YoY

+11% YoY

-1% YoY

-2% YoY

+49% YoY

-10% YoY

+16% YoY

-7% YoY

-17% YoY

-21% YoY

-5% YoY

+29% YoY

-21% YoY

+2% YoY

+102% YoY

-45% YoY

© comScore, Inc. Proprietary. 16 NOTE: Domains ranked by Total Unique Visitors (000) June 2013

Source: comScore, Inc., Media Metrix, Canada, Home & Work, Persons 2+, Jun. 2012 – Jun. 2013

The Retail Category in Canada – Top 10 Retail Domains

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

To

tal U

niq

ue

Vis

ito

rs (

00

0)

AMAZON.COM*

APPLE.COM

KIJIJI.CA Buy & Sell

IMDB.COM*

AMAZON.CA

WALMART.CA

CANADIANTIRE.CA

NETFLIX.COM

BELL.CA

FUTURESHOP.CA


#1 Source: comScore, Inc., Media Metrix, Canada, Hone & Work, Persons 2+, Canada, Jun. 2013

Top Retail Category Entities in Canada

10,809,000 UVs

6,604,000 UVs

4,655,000 UVs

Up 10% from June 2012

6,790,000 UVs

APPLE.COM 6,556,000 UVs

iTunes 3,639,000 UVs

#2 #3 #4

1,145,000 UVs

6,167,000 UVs



Down 8% from June 2012


Down 8 % from June 2012


No change from

June 2012

4,293,000 UVs

WALMART.CA 3,525,000 UVs

WALMART.COM 1,415,000 UVs




© comScore, Inc. Proprietary. 18 Source: comScore, Inc., Media Metrix, Canada, Home & Work, Persons 2+, Canada, Apr. 2013

Top Retail Category Entities in Canada

3,350,000 UVs 2,957,000 UVs

#5 #6 #7 #8

32% from June 2012

3,385,000 UVs

Up 6% from June 2012 Up 7% from June 2012

3,784,000 UVs

2,547,000 UVs

2,157,000 UVs

Best Buy Sites




© comScore, Inc. Proprietary. 19 Source: comScore, Inc., Ad Metrix, CA, Home & Work, Persons: 2+, Jun 2013

Top Retail Advertisers in Canada

Canon Inc.

166.7 Million Display Ad

Impressions

QuiBids LLC.


Impressions

Netflix, Inc


Impressions

Zulily, Inc.

149.2 Million Display

Ad Impressions

JustFabulous, LLC.


Impressions

© comScore, Inc. Proprietary. 20 Source: comScore, Inc., Ad Metrix, CA, Home & Work, Persons: 2+, Jun 2013

Top 10 Industry Categories Advertising in Canada

2,183,455

2,624,720

3,260,440

3,700,598

4,025,601

Automotive

Retail

Consumer Goods

Online Media

Finance

Display Ad Impressions (000)

Will more branded digital display advertising fuel online

commerce? What about more advertising in general?

How do online promotions affect online retail? 4


Is Digital Advertising Effective in

Driving Brand Metrics and Sales?


Awareness & Loyalty

Exposure to the COFFEE COMPANY digital campaign lifted favorability,

consideration, and intentions towards the brand.

95.1%

35.4% 30.3% 30.7% 31.0%

95.3%

39.1% 33.0% 34.9% 34.8%

Aided Awareness(n=740)

Overall Opinion(n=705)

Intent to Recommend(n=705)

Consideration(n=705)

Purchase Intent(n=705)

Baseline Exposed

Indicates significant lift above baseline at 90% confidence level

+3.8 pts +2.7 pts +3.7 pts +4.2 pts


Unexposed 1-2

Exposures 3-4

Exposures 5+

Exposures

Awareness n/a (n=452) (n=102) (n=186)

Aided Awareness 95.1% 95.2% 95.3% 95.6%

Opinions & Intentions n/a (n=430) (n=98) (n=177)

Overall Opinion 35.4% 37.8% 39.3% 44.7%

Intent to Recommend 30.3% 32.1% 33.2% 37.2%

Likelihood to Consider 30.7% 33.4% 35.1% 41.4%

Purchase Intent 31.0% 33.4% 34.9% 40.5%

Indicates significant lift above baseline at 90% confidence level

Frequency Analysis

Brand ratings were highest among consumers with 5 or more campaign

exposures.


U.S. State of the Online Retail

Economy

Summary


Metric Q2 2012 Q2 2013 % change

Dollar Sales ($ Billions) $43.2 $49.8 +16%

Dollars per Buyer $241.9 $274.1 +13%

Buyers (Millions) 178 182 +2%

Average Order Value $73.8 $76.4 +3%

Transactions (Millions) 584 652 +12%

Transactions per Buyer 3.28 3.59 +9%

Key Desktop e-Commerce Buyer and Transaction Measures

Q2 2013 vs. YA Source: comScore e-Commerce Measurement

e-Commerce dollar sales in Q2 increased due to growth in transactions

per buyer. Number of buyers and AOV remained relatively flat.


Desktop computers

+0%

Cameras and equipment

+11%

Over half of retail categories showed very strong growth of +15% or

more versus a year ago, led by apparel/accessories and digital content

Q2 2013 Desktop e-Commerce Sales Growth vs. YA by Retail Category Source: comScore e-Commerce Measurement

Product Category Q2 2013 Growth

vs. YA

Apparel & Accessories Very Strong

Digital Content & Subscriptions Very Strong

Sport & Fitness Very Strong

Consumer Packaged Goods Very Strong

Home & Garden Very Strong

Furniture, Appliances & Equipment Very Strong

Event Tickets Very Strong

Consumer Electronics (x PC Peripherals) Very Strong

Computers/Peripherals/PDAs Strong

Jewelry & Watches Strong

Flowers, Greetings & Misc. Gifts Moderate

Office Supplies Moderate

Video Games, Consoles & Accessories Moderate

Books & Magazines No growth

Mobile phones and plans

+25%

Growth rate definitions:

Very Strong: +15% or higher

Strong: +10-14%

Moderate: +5%-9%

Low: +1%-4%

Portable devices

(e.g. tablets)

+22%


Holiday Season includes November and December

*Percentage change includes seasonal adjustment to account for unequal

number of weekdays and weekend days in 2011 and 2012

2012 U.S. e-Commerce holiday spending grew 14% to record $42.3B

$19.6

$24.6

$29.2 $28.0

$29.1

$32.6

$37.6

$42.3

+26%

+19%

-4%

+4%

+12%

+15%*

14%

$0.0

$5.0

$10.0

$15.0

$20.0

$25.0

$30.0

$35.0

$40.0

$45.0

-10%

-5%

0%

5%

10%

15%

20%

25%

30%Holiday Season $ in Billions Y/Y Growth Rates

Holiday Season Retail e-Commerce Sales ($ Billions)

Growth vs. YA Source: comScore e-Commerce Measurement

2005 2006 2007 2008 2009 2010 2011 2012*


2012 had 12 days surpass $1 Billion in sales, with 4 out of 5 days

during week of Green Monday hitting that threshold

$-

$200,000,000

$400,000,000

$600,000,000

$800,000,000

$1,000,000,000

$1,200,000,000

$1,400,000,000

$1,600,000,000

Cyber

Monday

Black

Friday

Green

Monday

Free Shipping

Day

Online Spending by Day 2012 Source: comScore e-Commerce Measurement


E-Commerce Shipping Options & Preferences

Free Shipping


More than half of online transactions in Q2 2013 involved

free shipping, up 4 points from Q2 2012

40% 52% 49% 47% 43%

50% 48% 51%

60% 48% 51% 53% 57%

50% 52% 49%

Q32011

Q42011

Q12012

Q22012

Q32012

Q42012

Q12013

Q22013

% Transactions with Free Shipping

% Transactions with Paid Shipping

Percentage of e-Commerce Transactions with

Free Shipping Source: comScore e-Commerce Measurement


Nearly all consumers have abandoned a cart online, and most have

added items to their cart to qualify for free shipping

Returns

Shopping Cart

Abandonment

For full study results, see

www.ups.com/comScore2013


Mobile/Multi-Platform

Commerce

How will multiple devices change the way we consume

Online Retail and transact online? 6

© comScore, Inc. Proprietary. 33 Source: comScore Device Essentials

Media Fragmentation is the New Reality

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

U.S

. T

ota

l D

ev

ice

Ow

ne

rs

140 MILLION

60 MILLION

+13%

YoY

+32%

YoY


•Mobile Browsing Index = Retail Category Penetration via Mobile / Retail

Category Penetration via Desktop x 100

• Index of 100 indicates average representation.

Apparel and Home Furnishings index very highly for tablet

browsing despite being below average on smartphones

Total Mobile Smartphone Tablet

Retail 100 100 100

Department Stores 104 97 118

Comparison Shopping 71 66 68

Apparel 103 90 147

Computer Hardware 63 55 80

Home Furnishings 91 70 158

Consumer Electronics 95 87 100

Retail - Movies 130 119 144

Health Care 130 124 115

Books 215 202 221

Retailer Category Mobile Browsing Index* Source: comScore Media Metrix Multi-Platform, U.S., June 2013


Form factors have varying implications on consumer spend at the

product category level, with no ‘one size fits all’ solution.


0 50,000 100,000 150,000

Amazon Sites

eBay

Wal-Mart

Apple.com Sites

Target Corp.

Best Buy Sites

The Home Depot

Etsy.com

Lowes.com

Sears.com

PC Only PC + Mobile Mobile Only

One third of the average retailer’s monthly web site

visitors now arrive exclusively via mobile devices

Selected Leading Retailers: Total U.S. Digital Population

Unique Visitors (000) by Platform Source: comScore Media Metrix Multi-Platform, U.S., June 2013

The average Top 50 retailer extends

its desktop audience by

54% via mobile channels

Note: Mobile = Smartphone + Tablet

149M

91M

59M

55M

37M

28M

25M

19M

18M

18M


Smartphones and Tablets have driven a doubling of time

spent with digital media over past 3 years

416 477

81

381

100

May 2010 U.S. May 2013 U.S.

Tablet

Smartphone

Desktop

+93%

Total Digital Media Time Spent (Billions of Minutes) by Platform Source: comScore Media Metrix Multi-Platform, U.S., May 2013 vs. May 2010

+370%

+15%

How are you adapting to this multi-platform world? 7


Multi-platform: Engagement with Sports content has seen strong growth

across all platforms, including desktop

43

Time Spent on Sport Sites

(Millions of Minutes)

Source: comScore Media Metrix & Mobile Metrix, US

+72%

+385%

6,479

729

3,537

1,052

Feb-2010 Feb-2013

N/A

+20% 7,799


43

Multi-platform: Desktop consumption of Weather content has declined

Feb-2010 Feb-2013

Time Spent on Weather Sites

(Millions of Minutes) Source: comScore Media Metrix & Mobile Metrix, US

-46%

+15%

+385%

3,214

427

1,723

2,073

373 N/A

Retail? 8


16,322 16,708

10,400

16,810

6,141

March 2012 Aug 2013

Tablet

Smartphone

Desktop

Multi-platform: Desktop consumption of Retail content has Plateaued

Time Spent on Retail Sites

(Millions of Minutes) Source: comScore Media Metrix & Mobile Metrix, US

+2%

+48%

+62%

N/A

© comScore, Inc. Proprietary.

www.comscore.com

www.facebook.com/comscoreinc

@comScore

Darrick Li

Account Manager

[email protected]

416.646.9974

Thank you!

mailto:[email protected]

Business

State of the Canadian Retail Consumer Presented by comScore