Canadian E-Commerce Gains Momentum - $4.3 billion Spent Online in 2000, More than Double Last Year's Spending

VANCOUVER, March 13, 2001 -- Canadian Internet users spent a total of $4.3 billion dollars online in 2000, slightly exceeding this year's earlier projection of $4.1 billion, according to a study conducted by Ipsos-Reid, results to be presented at Comdex Canada West 2001. Total online expenditures by Canadian Internet users have increased nearly 2189 times over 1999's spending level of $1.65 Billion.

Over the course of the year 2000, three trends emerged in Canada: a growing critical mass of online buyers, Canadians purchased more online due to the increased availability and selection among Canadian e-retailers, and increased spending among experienced users. And all indications are that the growth of online shopping in Canada will continue in 2001.

• The number of online purchasers continues to grow. The number of online users in Canada (now surpassing 15 million) who have ever purchased a product or service online has increased from 27% in the first quarter, to 34% currently. Stated another way, the proportion of Canadian adults who have ever made an online purchase now stands at 23%--or over 5 million people.
• Intentions to purchase are increasing. Of the 66% of online Canadians who have never made a purchase online, 28% will likely make a purchase online in 2001. This is higher than the 20% of non-purchasers who indicated the same in the same time period one year earlier.
• Current online spenders plan to spend even more next year. Those who bought online last year expect that their spending will increase in a significant way. Nearly one-half of online shoppers indicate their online spending next year will increase a little (40%), or increase a lot (5%). This is only slightly less optimistic than the 64% who indicated the same last year.
• The proportion of online shoppers buying from Canadian sites is increasing. Canadian e-tailers are enjoying an increasing slice of the e-commerce pie, as 63% of online purchasers indicated that their most recent purchase was at a Canadian-based site. This is up from 52% at this time last year.

"Contrary to what the critics are speculating, the results show that b2c e-commerce in Canada is not dead" said Steve Mossop, Senior Vice President of Ipsos-Reid. "With the prevalence of doom and gloom reports in this sector over the past six months or so, the news is refreshingly positive. The meltdown in this sector is more a function of the closing of a bunch of websites that nobody was visiting--when in fact, more people continue to access the internet online, more people are purchasing online, and the ones that are buying plan to spend more money next year."

Banking services, downloadable computer software, books, and music remain at the top the list of categories purchased this year. Computer software, tickets to events, clothing hotel and air travel, and consumer electronics round out the top ten. What is important to note is that each of these categories still demonstrate significant growth potential in the future--especially online travel, books, music and software.

		Have Ever Bought Online	Will Consider Buying Online
	Among Online Purchasers (n=789)	Among Non- Purchasers (n=780)
Top 10 items	Q4 2000	Q4 2000
Banking services	42%	28%
Downloaded computer software	42%	34%
Books	41%	46%
Music or music CDs	37%	35%
Mailed computer software	29%	20%
Sports/Entertainment tickets	23%	32%
Clothing	23%	24%
Hotel stay	17%	35%
Air travel	16%	34%
Consumer electronics	13%	22%

"The top items that Canadians have purchased over the Internet over the course of the last couple of years has stayed remarkably consistent," said Marcie Sayiner, Senior Research Manager at Ipsos-Reid. "What has increased noticeably is the intent to purchase, which will result in 2 million new Canadians purchasing online for the first time this year. Clearly, E-commerce is alive and well in Canada."

Ipsos-Reid is pleased to be sharing some of the results from their Interactive Reid report, including detailed implications for e-commerce, at the Comdex Canada West 2001 show, taking place on March 13-15 at the Vancouver Convention and Exhibition Center.

The "Canadian Inter@ctive Reid Report" is the largest, most comprehensive and authoritative source of its kind about quarterly Internet trends in Canada. The results are based on two separate data collection instruments. In the first, 1,000 web users from Ipsos-Reid's Canadian Internet Panel are surveyed online. Panelists are chosen through random telephone surveys conducted on an ongoing basis across Canada. Results are complemented by a further 1,500 interviews via telephone with Canadian adults in order to verify results of the panel, and track issues among non-Internet users. The most recent quarterly results were collected between December 27th, 2000 and January 7th, 2001.

These data are statistically weighted to reflect the population proportions of regular online users by online expertise and regional distribution. Our panelists represent approximately 12.4 million Canadian adult Internet users who are online for one hour a week or more (there are a total of 15.3 million adults who have Internet access).

With a national sample of 1,000 and 1,500 (for each component), one can say with 95% certainty that the overall results are within a maximum of 1772.5 percentage points of what they would have been had the entire population of Canada's regular online users been surveyed. The margin of error will be larger for sub-groupings of the survey population.

Established in 1979, Ipsos-Reid is Canada's leading market research and public opinion company. Its is best known for the Angus Reid Express Poll, the most widely quoted source of public opinion in the country. Founded by Dr. Angus Reid, Ipsos-Reid has conducted extensive market and social research in 80 countries and in 40 languages, and serves clients around the world through more than 300-professionals and 1,000 data collection staff in eleven offices. The company is a member of the Paris-based Ipsos Group, ranked among the top ten research companies in the world.

For more information, contact:

Marcie Sayiner, Senior Research Manager, Technology Research
Ipsos-Reid Vancouver
t: 604.893-1603
e: [email protected]
w: www.ipsos-reid.com

or

Chris Ferneyhough, Vice President, Technology Research
Ipsos-Reid Toronto
t: 416.324.2283
e: [email protected]
w: www.ipsos-reid.com