Canadians more like Swedes when it comes to the Internet

Vancouver, August 20, 2001 - When it comes to the Internet, Canadians seem to have more in common with users from Sweden, Norway and Finland - generally considered world leaders in Internet adoption -- than the United States, according to new findings from international market research firm Ipsos-Reid which recently interviewed thousands of active Internet users in Canada and the U.S. on everything from Internet banking to music downloading.

The company then compared the U.S-Canada results with its global Internet research and concluded that in many areas, Canadian usage patterns resemble Scandinavian countries more closely than the U.S. (Global Internet usage comparisons available.)

"We may share a common border with the U.S., but we have more in common with Swedes than Americans when it comes to how and why we use the Internet," concluded Bonnie Sherman, President of Ipsos Interactive Services, a division of Ipsos-Reid. "The online publics in Canada and Sweden, particularly the younger generation, is pulling ahead of the U.S. in their strong affinity for Internet banking, music downloading, and next generation wireless access."

Among the study's findings: Although Canadians might like to gripe about their banks, Canadian Internet users are much more confident than Americans about banking or investing online. On a per capita basis, Canadian Internet users also outpace Americans when it comes to overall Internet usage, downloading music and having high speed Internet access and match those of the leading edge Scandinavian countries. (Also see, a portrait of American Internet users.)

Nearly two-thirds (61%) of active Canadian Internet users have conducted financial transactions online, compared to less than one-third (29%) of active Internet users in the U.S., according to online surveys conducted in March and May, 2001, using the Ipsos-Reid North American Internet Advisory Panel.

The North American Internet Advisory Panel consists of 30,000 Canadian households and 50,000 American households who participate in Internet surveys on a regular basis with Ipsos-Reid. The Internet Advisory Panel includes some of the more Internet savvy consumers in North America, all of whom spend at least an hour a week online.

Moreover, 48% of Canadian Internet users who have been online for less than a year have already banked online, while just 13 per cent of American newcomers to the Internet have done so.

Why the big difference? In a word -- trust.

More than two-thirds (69%) of active Canadian Internet users say they're confident the Canadian banking industry can ensure the security and privacy of their account information and financial transactions done online. By comparison, fewer than half (49%) of active U.S. users are confident the American financial services' industry can do the same.

"The Canadian banking system has been extremely aggressive in promoting online banking and investing and has obviously done a good job convincing Canadians that the Internet is a viable and secure option," said Marcie Sayiner, Senior Manager of Research with Ipsos-Reid. "Of course, another contributing factor to the success of online banking in Canada is our national banking system compared with a much more regional and diffuse banking system in the U.S."

Active Internet users in Canada and the U.S. who have not banked online said they favour more traditional methods of banking and have concerns about privacy or security.

More Canadians than Americans invest online, too

Some 15% of active Canadian Internet users have invested online compared to 10% of American users.

Among the reasons users have not invested online:

• Canadian respondents cite a preference for dealing with a financial advisor or other investing methods, as well as concerns about privacy and security.
• Americans, on the other hand, put privacy or security at the top of their concerns, followed by not having enough money and preferring other methods of investing.
• In both Canada and the U.S., the biggest users of online banking are aged 18 to 34. Internet users aged 55 plus are the least likely to do their finances over the Web.

"Clearly the use of online banking and investing will only increase in the future as the younger generation, who are most comfortable using the Web for these purposes, ages and moves into more complex financial dealings," Sherman said.

Online shopping remains more popular among Americans

Active users of the Internet in the U.S., meanwhile, are far more likely to shop online than Canadian Internet users, and subscribe to three times as many online newsletters than their Canadian counterparts. For example, more American Internet users (77%) have bought a product or service online than Canadian users (68%). And, in the last year, American online shoppers made more than twice as many buys as Canadian online shoppers - 14 purchases compared to 6.5. Canadians spent an average of $895Cdn vs $1,400 Cdn for Americans.

"When it comes to shopping online, the U.S. had a jump start on Canada and has never looked back. The same old issues remain: the lack of Canadian online options, exchange rates and delivery costs," Sayiner said. "Clearly the demand is there from Canadian Internet users, but it's up to Canadian retailers and U.S. chains with a Canadian presence to help close the gap."

Young American shoppers (aged 18-34) made more online buys than those over age 34. The reverse is true in Canada, where shoppers aged 35-54 bought more online than younger adults. Canadian online shoppers are buying at home -- 67% of purchases were made from a Canadian site. Americans are even more inclined to shop domestically - 93% of online purchasers used an U.S. site.

Satisfaction levels with online shopping differ between the two countries, as well

Not surprisingly, Canadians reported being much less satisfied than Americans with cost savings (36% satisfied compared to 64% satisfied) and slightly less satisfied with selection (61% satisfied compared to 73% satisfied). In other findings, Canadians were twice as likely to respond to web site addresses advertised on TV, newspapers or magazines than Americans were. Some 13% of Canadians found the site where they made their most recent purchase this way, compared to just 5% of Americans. As well, active American users who have registered to receive e-mail from a website sign-up for an average of 14 sites; the average for Canadians who have registered is only 5.

CANADA vs. U.S.

Percent of active Internet users who:
	U.S.	Canada
Have high-speed Internet connection	14	31
Have done banking online	29	61
Have made purchases online	77	68
Are confident that banking industry can ensure online privacy	49	69

METHODOLOGY

The Canadian portion of this study is based on 1,000 online interviews with a representative cross-section of Canadian adults who spend at least an hour online per week. These online interviews are conducted with members of our Canadian Advisory Panel . A weighting scheme has been applied to reflect the profile of online Canadians. These weights are based on Internet skill level and the provincial distribution of users. Online interviews were completed using QC Web between March 9th and March 19th, 2001. A national sample of 1,000 completed interviews is considered accurate to within 1773.1% of what the results would have been had the entire Canadian adult online population been contacted, reliable 19 times out of 20. Among subgroups of the survey population, the margin of error will increase.

The American portion of this study is based on 740 online interviews with a representative cross-section of American adults who spend at least an hour online per week. These online interviews are conducted with members of our US Internet Advisory Panel . A weighting scheme has been applied to reflect the profile of online Americans. These weights are based on Internet skill level and the regional distribution of users. Online interviews were completed between May 7th and May 20th, 2001. A national sample of 740 completed interviews is considered accurate to within 1773.6% of what the results would have been had the entire U.S. adult population been contacted, reliable 19 times out of 20. Among subgroups of the survey population, the margin of error will increase.

Contact information:
Vancouver: Bonnie Sherman, (604) 893-1630.
Toronto: Chris Ferneyhough, (416) 324-2283.

i) A note on the Canadian Advisory Panel: the panel is the only fully staged, randomly selected, representative panel in Canada, and consists of 70,000 households with a sub-group of 30,000 households online. Members are randomly recruited.

ii) A note on the US Internet Advisory Panel: the panel is a fully staged and representative panel of Internet users in the U.S., and it consists of 45,000 households. Members are recruited from a variety of sources.