A look at the Canadian consumer and how retailers can utilize direct mail as part of a multi-channel campaign, to take advantage of online plus retail footprint increased sales.

1. Canada: The Runway to Growth

2. Topics
Canadians…eh!
Consumer trends and preferences
“Hottest” retail sectors
Targeting
Creative ideas

3. Canada
80%
of Canadians live
within
100 Miles
of the US border
of Canadians of Americans
have disposable
income
AFFLUENT
CANADA
$72,240
US
$65,054
HIGH
EARNERS
Median Household Income
NEARBY
46%
Live in 6 major
metropolitan
centers
64% 50%
OVER 35 MILLION PEOPLE. Untapped. Lucrative.
Statistics Canada – 2010, 2011 & 2012 / How Canada Shops, September 2012

4. Source: Department of Finance Canada; Private domestic demand is the sum of consumption and investment (including housing) by households, businesses and the non-profit sector.
9.2%Canada’s consumer
demand growth since
pre-recession peak
5.1%US consumer demand
growth since pre-
recession peak
Canada enjoys a strong,
stable economy, where
consumer demand
outweighs that of its US
neighbor…

5. Source: Department of Finance Canada
… and disposable income
in Canada is growing
rapidly
12.2%
Canada’s consumer
disposable income
growth, 2006-2012
4.4%
US consumer
disposable income
growth, 2006-2012

6. Delivering the online world™
Source: Statistics Canada; Ryerson University; US Census Bureau; US Commerce Department; shopping mall performance measured by sales per square foot
Canada outperforms the US in retail
sales growth

7. Consumer Trends

8. So we shop abroad
Canadians want more choice…
42%
buy outside
Canada
for better
value
37%
buy outside
Canada
to get items not
available in
Canada
had items
shipped from
outside of Canada
in the past 3
months
60%
of Canadians have
purchased from a US
company or website
66%
Statistics Canada, October 2011 / J.C. Williams: Canadian E-shoppers: The online shopping/buying experience, Canada Post Study 12-209, September 2012 / BMO, Nesbitt Burns, May 2012

9.  Open physical stores in key locations (or store
within a store)
 Engage in traditional marketing
 Large fix cost structure with strong brand
presence
“Pull” Omnichannel Strategy
 Enter Canada via e-commerce
 Master logistics and distribution
 Heavy focus on digital and data analytics
Use insights and direct mail to drive sales and
Loyalty programs are key
“Push” Omnichannel Strategy

10. Source: National Retail Federation; Deloitte Analysis of Top 100 Retailers list, Power Players in Apparel and Sporting Goods list
53%
of top US
retailers have
entered
Canada
69%
of top US
specialty
retailers have
entered
Canada

12. Luxury Brands coming or recent to Canada

13. Click to edit Master title style
13
Delivering the online world™
Canadian E-commerce:
What’s Happening?

14. ANTICIPATED E-COMMERCE GROWTH
Source: Retail Ecommerce Sales in Canada, 2012-2018, eMarketer Research Study, May 2014
Canadian online retail sales to
double between 2013 and 2018
TOTAL CANADIAN
ONLINE RETAIL
SALES 2013
$22 Billion
PROJECTED
CANADIAN
ONLINE RETAIL
SALES 2018
$44 Billion

15. Acquisition & LoyaltyWhen you add Direct Mail to a multimedia campaign,
campaign awareness can increase by 20% or more !
of online shoppers are interested in receiving sales
offers and coupons by physical mail
61%
Source: J.C. Williams: Canadian E-shoppers: The online shopping/buying experience, Canada Post Study 12-209, September 2012

16. Hottest Retail Segments

17. Delivering the online world™
KEY CANADIAN INDUSTRIES
2014 E-COMMERCE PARCEL VOLUME
INCREASE
Source: YOY parcel volume growth – 2013 to 2014 (Jan - June). Data derived from 6035 Canada Post
e-commerce customers within 11 key industries

18. C
l
i
c
k
t
o
e
d
i
t
M
a
s
t
e
r
t
i
t
l
e
s
t
y
l
e
E-COMMERCE:
TOP 10 HIGH-GROWTH
CANADIAN CITIES
Source: YOY parcel volume growth – 2013 to 2014 (Jan - June). Data derived from 6035 Canada Post
e-commerce customers within 11 key industries

19. of Canadians
have shopped
online…
46% of
Canadian online
shoppers have
made more than 3
online purchases in
past three months
Consumer Delivery Preferences, CP 14-206, August 2014
Ipsos Canadian Inter@ctive Reid Report, September 2014
82%

20. # of online purchases
by frequent online
shoppers in the past
year
are making 10 or more online
purchases per year
Source: Consumer Delivery Preferences, CP 14-206, August 2014
77%

21. Clothing/Apparel/Footwear
Books55%
Computer/Electronics50%
Health & Beauty33%
Software/Games/DVDs
31%
66%
Source: Consumer Delivery Preferences, CP 14-206, August 2014

22. Online shoppers are
more likely to respond to offers
45%
of online shoppers are more likely to make additional
purchases when retailers offer promotions
64%
of online shoppers are more likely to make additional
online purchases from retailers who make suggestions
based on previous purchases
Source: 1 J.C. Williams: Canadian E-shoppers: The online shopping/buying experience, Canada Post Study 12-209, September 2012

23. An ongoing study conducted
by Canadian research firm
Abacus Data, found that while
about 9 in 10 Canadian adults
use loyalty programs to collect
points or miles, they use an
average of 3 different loyalty
programs to collect those
points or miles.
“These statistics haven’t really
shifted much throughout the
3 surveys we conducted in 2013.
We consistently see most
Canadians using three or more
rewards programs on a regular
basis to collect points or miles
for future redemption”, says
Sean Copeland, Director of
Consumer Research at Abacus Data
Canadians are Loyal = provides rich data options

24. Canada Post Eco-System
Shop and Buy
Fulfillment
Deliver and Track
Returns
Acquire
Shopper
Analyze
Data

25. Canada Post delivers daily
15.5 Million addresses in Canada
•4.7 Million houses
•3.6 Million apartments/condos
•3.9 Million Community Mailboxes
•800,000 Rural Mailboxes
•1.7 Million PO Boxes
(primary delivery address)

26. Targeting to increase ROI

27. • Higher impact, personal communication and
campaigns that engage your customers
and motivate them to respond.
• Attention grabbing campaigns to drive
multi-channel traffic, generate sales and
strengthen your brand.
• New customers, deeper relationships and
greater customer lifetime value.
Using data and
analytics
The power of our
direct mail
of Canadians made an
in-store purchase and
61%
39%
an online purchase as a
result of a marketing piece
received in the mail
Source: Direct Mail Omnibus, CPC #12-220, January 2013

28. Better understanding yields better response rates
Targeting in Canada

29. Targeting options in Canada
 Targeting at a postal code level (privacy compliant)
 Census Canada Data is available
 Unaddressed admail targeting at a postal walk level
 Addressed admail + list options available
 DM has been successful for many companies (B2B
and B2C) including many that want to drive to web.
 Personalization, beyond the name is the next big
trend.
Challenges:
- List universe is small and selective due to privacy
laws
- Data hygiene is always a concern

30. Personally observed impact of CASL:
 Reduction in e-mail lists from 10-90%, typically 30%.
 Some US marketers have been turned off of Canada
 Some are not paying attention
 Many complaints filed, but no charges as of yet
Benefits:
 Canadians who remain signed up, are engaged with your brand
 Marketers are looking for additional options to reengage higher
value customers
 Increased focused on hygiene, process, and data
CASL impact

31. Creative ideas

32. Catalogs - why Canada?
Less than 50% of Canadians have received catalogs
in the past 12 months from major verticals like
apparel and tourism.
That’s not very many, why should I care?
Because they work.
47% Canadians will retain a catalog for later reading
38% will visit a store to purchase an item
17% will purchase an item online
12% will purchase by mail or phone.

33. Need image
of
Mark
Twain
TNS research on Canada’s Catalog Industry,
 Using a paper catalog drives purchases
 36% of online consumer purchases are generated
from a paper catalog.
 94% Canadians act on the catalogs they receive: read,
passed along, visited store, website, make a purchase;
 The purchase cycle of a Canadian consumer is 3-4
weeks after receiving a communication piece;
 Canadians receive the most catalogs from: department
stores, apparel, building/garden supply, appliances
and office supply/electronics companies.
Canadian Catalog Use

34. Need image
of
Mark
Twain
1. Add copy to your covers (the cover on the right pulled 124% more
sales than the non-teaser cover below.
2. Make your back cover work harder
3. Make it easy to find things items
4. Make it easy to read – ditch the tiny font
5. Add an offer to your catalog
6. Test, test, test!
Six Ways to Increase Response- Catalog
Source:, http://worthingtonlevy.wordpress.com

35. Targeting Mobile Buyers

36. Driving Retail Store traffic

37. CONFIDENTIAL | 37
Embossed, Die Cut or Textured Paper
Interact
With Direct Mail, You Get To Create an Experience

38. TIME IS NOW

39.  Canada has about the same population as California
 We speak the same language
 We love to be loyal
 Use your data (shipping, targeting etc.)
 Consider catalogs/mini-catalogs to engage
 Think multi-channel marketing
 Think Canada Post
Time is Now - recap

40. Andreas Schwartz
Senior Manager, Direct Marketing
Canada Post
E: andreas.schwartz@canadapost.ca
P: 604-314-7065
Thank you / Questions