E-commerce refers to the buying and selling of goods online, including the digital transmission of payment and data. Similar to traditional commerce, the three main types of e-commerce are business-to-business, business-to-consumer, and consumer-to-consumer.

E-commerce has skyrocketed in popularity over the past decade. The number of people shopping online has been increasing steadily over the years and the COVID-19 pandemic has sped up the development. The creation of new banking apps and mobile payment services, such as Apple Pay, Google Play, and PayPal, has made online shopping easier than ever. In fact, retail e-commerce sales are expected to reach up to $108 billion in sales by the end of this year.

Continue reading to learn more about e-commerce in Canada.

e-Commerce Statistics for Canadians

  • e-Commerce experienced a 75% increase in 2020 following the closure of brick-and-mortar shops.
  • In December 2020, e-commerce retail trade sales amounted to C$5.19 billion.
  • By 2025, e-wallets are expected to make up 27% of all online payments.
  • 34% of retail e-commerce is done on mobile devices.
  • Canada is the ninth-largest market for e-Commerce.
  • 16.6 is the average number of online purchases made by Canadians per year.
  • 55% of e-merchants sell through social media.

Canadian e-commerce retail sales reached an all-time high in December 2020

In December 2020, Canadian e-commerce retail trade sales reached C$5.19 billion, surpassing the previous record from May 2020 of C$4.34 billion. Lockdown measures, due to the COVID-19 pandemic, have made online shopping even more convenient, allowing consumers to purchase anything they need from the comfort of their homes. As of 2019, e-commerce accounted for 6.9% of all retail sales in Canada. Insider Intelligence predicts that by 2025, e-commerce will be responsible for 13.4% of all Canadian retail sales.

There are over 27 million Canadian e-Commerce users

Over 27 million Canadians are e-commerce users, translating to 72.5% of the population. The number is expected to increase to 77.6% by 2025. As of 2020, 37% of Canada’s online shoppers were Baby Boomers, aged 53 to 72. The second and third most common shopper demographics were Gen X-ers (aged 38-52) and Millennials (aged 24-37), respectively.

Fashion is the most popular e-Commerce product

Fashion is the most popular e-commerce product in Canada, followed by electronics and media. The most popular online clothing stores in ranked order are Gap Canada, Hudson’s Bay Company, Amazon Canada, Zara, and Walmart. By 2025, Statista predicts fashion e-commerce will show an annual growth rate of 15.45%, with the average revenue per user (ARPU) reaching up to C$1157.

The largest e-commerce market in Canada is Amazon.ca

Amazon’s subsidiary, Amazon Canada, is the largest e-commerce market in Canada, with its 2020 net sales reaching C$ 9,692 million. The website receives about 32.08 million unique visits per month, over 60% of which come through direct website searches. At the end of the fourth quarter of 2020, Amazon reported a sales revenue of C$170.5 billion. In 2018, Amazon Canada reported that Canadian small and medium-sized businesses collectively accumulated over $900 million in sales.

The following two most profitable stores, Walmart Canada and Costco Canada, earned $2.3 billion and $1.6 billion, respectively, in revenue.

In 2022, almost 40% of retail e-commerce took place on mobile devices

In Canada, about 37% of retail e-commerce occurred via mobile devices in 2022. Statista estimated that in 2020, mobile device e-commerce purchases accounted for C$27 billion in revenue, whereas desktop e-commerce reached up to C$77 billion in revenue. The practice of conducting e-commerce through mobile devices is known as m-commerce.

The US International Trade Commission reports over 50% of Canadians have made m-commerce purchases, as of January 2021. Millennials are the most popular consumer demographic for m-commerce. M-commerce is expected to rise in the next few years, due to the development of new convenient mobile shopping and payment applications.

Twenty percent of Canadian online shoppers use PayPal

Almost 60% of Canadians use traditional credit cards as their preferred payment method in e-commerce transactions. About 20% of Canadian e-commerce users pay via PayPal, an online payment system provider. Other popular electronic payment methods (or e-wallets) in Canada include Apple Pay Canada, Google Play Canada, Samsung Pay Canada, and Alipay. e-wallet usage is expected to increase, as the US International Trade Commission expects 27% of online payments to take place via e-wallets by 2025.

Mobile payment has become more popular in recent years due to its fast and convenient nature, especially for online shopping. As many consumers choose to have their computer remember their login credentials, the check-out process can occur in a matter of seconds.

Older users are not as comfortable making online purchases as younger demographics

With the ease brought forth by e-wallets, comes suspicion as well. Older demographics are more comfortable using traditional methods of payment due to security concerns. However, e-wallet services have been shown to be just as safe as regular credit card methods. These systems use tokenization, a data security mechanism that temporarily substitutes important data with an undecipherable string of details. Only once the payment is accepted by a secure financial services provider are the values uncovered.

E-wallets are most common among younger generations, with about 57% of the Canadian population, ages 18-34 storing personal financial information in a mobile app or e-Commerce site. The number is similar to Canadians ages 35-44, where 51% store their data in m-commerce apps.

Sixty percent of online purchases are made by 18% of online shoppers

On average, Canadians made 16.6 online purchases per person in 2019. About 8% of Canadian online shoppers were in the hyper elite category, purchasing over 41 items online in one year and 10% were in the hyper category, purchasing 25-40 items. About 6% of Canadian online shoppers only shopped online once.

Over half of all online purchases are made by shoppers in the hyper and hyper-elite categories. One reason for this is the influx of subscription-based services reduces shipping costs and time, making online shopping more convenient than in-store browsing. For a monthly payment, marketplaces, such as Amazon Prime Canada, allow consumers to fall into the pattern of visiting the website multiple times a week to purchase everything from essentials to luxury items.

About 95% of e-merchants who sell through social media do so through Facebook

Social media ads are powerful advertisement tools that can lure consumers into purchasing items they didn’t even realize existed. About 46% of Canadian online shoppers visited a retail website after they received a social media ad from it. Around 55% of e-merchants now sell their merchandise through social media, with an overwhelming majority coming through Facebook.

95% of these merchants sell through Facebook, with 69% selling through Instagram and 14% selling through Twitter. Companies can utilize their demographic breakdowns to assess which social media app will reach their target clientele the best.

The most common reasons for using e-commerce include cost savings, convenience, in-stock availability, and reduced waiting times. E-commerce popularity has already become a massive revenue source for Canada, with an expected increase to occur by 2025. Amazon Canada continues to lead as Canada’s greatest marketplace retailer, as the corporation continuously grows as a global player, offering competitive, low prices for an extensive variety of products.

To keep up with consumer needs, more small and medium-size businesses are expanding their online presence, through digital inventories and online payment transaction options.

Frequently Asked Questions

16.6 is the average number of online purchases made by Canadians per year.

34% of retail e-Commerce is done on mobile devices.

Between February 2020 and July 2022, e-Commerce sales in Canada increased by 67.9%. 

Canada is the ninth largest market for e-Commerce in the world.