American Express study indicates retailers are shifting to an online presence to grow revenue and profits in 2016
TORONTO –– This year, Canadian retailers are looking for new ways to increase sales by leveraging new technologies, e-commerce and social media says the fourth annual Canadian Retail Insights Report released today by American Express.
Over half of Canadian businesses celebrated steady growth over the past 12 months, many seeing an increase in sales over the previous year. The sector that saw the most impressive increase in sales was the fast food industry, which reported a 70 per cent gain in sales year over year. Of those sectors that did see a decline in growth, most attributed lower sales to changes in the economy
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. Positive sales were attributed to a number of factors, with investment in technology emerging as a driver of sales growth across industries (31%). Notably, the retail sector reported that they nearly doubled their international presence, which they attributed to an increase in online shopping (45% 2016 vs. 27% 2015). Still, many retailers remain dedicated to traditional sales drivers, like customer service and experience (85%), reaching new customers (83%) and providing new product offerings (73%).
The report, which surveys decision makers in the gas, grocery, restaurant, fast food, and general retail sectors nationwide, focuses on what’s top of mind for Canadian merchants, including: the state of the industry; challenges and pain points; growth strategy; customer loyalty and acquisition; competition and strategies for attracting customers.
“The study confirms how impactful technology is on the retail landscape. To remain competitive it’s imperative to stay attuned to not only what consumers are adopting today, but what they’ll be adopting tomorrow,” says Kerri-Ann Santaguida, Vice President and General Manager, Merchant Services, American Express Canada. “Customer service and new product offerings are always important, but in today’s market, embracing new technology to meet customer needs is setting businesses apart from the competition.”
Retailers adopt new payment technologies to attract customers
Across industries, retailers indicated that consumers are demanding new technology and e-commerce, with, 77 per cent of respondents reporting that their customers are driving their need to adopt mobile technologies. In-line with this finding, retailers plan to improve or invest in the following over the next 12-months:
- Mobile payment options (45%)
- Contactless payment options (38%)
- Creating/updating a mobile app (35%)
The report also found that while only a third (33%) of retailers are seeing increased sales from app or online purchases, they’re still considering these technologies as a way to remain competitive (75%) and attract new customers (64%). The fast food industry revealed itself as a leader in this space with 80 per cent stating they’re looking to invest and improve mobile or online purchasing options for consumers.
“It’s a new and exciting time for Canadian businesses with payment technology gaining momentum in Canada’s merchant landscape,” Santaguida says. “We see this as an area where we can continue to demonstrate value to our Cardmembers and merchants.”
Customer loyalty leads to greater sales
Not surprisingly, almost all retailers surveyed reported seeing value in having a loyal customer base (98%). Social media once again revealed itself as a trend providing greater opportunities for retailers to communicate and develop stronger relationships with their customers. In fact, 73 per cent specified social media as one of the best tools they are using to encourage loyalty, a 9 per cent increase since 2014. While social media presence continues to grow, more conventional means of gaining loyal customers include:
- Promotion or discounts (82%)
- Expanding product offering (68%)
Overall, the study shows a positive story for businesses across retail sectors, despite news of a shaky Canadian economy. Retailers are savvier than ever and are looking for growth opportunities by adapting to new technologies. With the rapid changes in technological capabilities this is an area that will continue to have impact on the overall retail landscape.
For more information, please visit AmericanExpress.ca.
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