Interesting Facts and Factoids every US retailer should know about Canada

THE

CANADAFACTBOOK

IntroductionSo, what’s special about Canada? Is it that 21% of Canadians

speak French? Or maybe it’s that they live an average of

3 years longer than Americans? Or are they special because

they eat more donuts than any other country?

We’ve taken a light-hearted approach in presenting some

facts about Canada to get you thinking about what it means

to be Canadian but as we’re sure you know, entering a new

market is serious business for retailers. And we take that seriously.

So, if you’re planning to enter the Canadian marketplace,

Watt International can help you translate your brand

proposition and provide your business with the insights and

strategic tools that will enhance your brand’s impact at every

touch point.

80% of Canadians live less than 155 miles from the US border.The proximity of Canada’s shoppers has many posit ive impl icat ions for US retailers, including a predisposition toward American brands built in part on a long legacy of cross-border shopping.

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Canadian E-commerce spending is forecasted to double by 2015.In 2010, Canadian shoppers spent an average of $1,600 each on goods and services online, spending $457 more than online shoppers in the US. As online shopping continues to grow in Canada, it is becoming increasingly important for retailers to integrate their online presence with all the other marketing touch-points of their business.

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Canada’s got more lefty hockey players! The majority of Canadian hockey players shoot left-handed, while the majority of American players shoot right-handed.

Some hockey stick manufacturers in the US say that up to 70% of their lefty stock goes to Canada, while only 30% of the left-handed sticks get distributed to players in the US.

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21% of Canadians “parlent français” (speak French…)In the province of Quebec all exterior signage and consumer goods packaging must be in French by law, while in many regions outside Quebec, all packaging must be bilingual.

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Canada is the second-largest country in the world by land mass. The population density in Canada is low, at 6 people per square mile, compared to 55 in the US. Much like Americans, 81% of Canadians live in large urban areas and cities, the largest 3 cities in Canada being Montreal, Toronto and Vancouver. Retailers in both countries focus on maximizing urban presence by adapting their stores to formats that suit the needs of the urban shopper.

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Canadian moms are global leaders when it comes to the environment!Over 69% of Canadian mothers recently surveyed said they cared about the environment, compared with 45% of American mothers. Forty-three percent of Canadian moms also said that they had stopped buying brands they felt were not ecologically friendly.

Companies in Canada must be alert to sensitivities around corporate responsibility and stay in touch with the demands of their shoppers.

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Like the US, Canada has large ethnic groups but with key differences.In the US, Hispanics make up about 16% of the population. In Canada, they represent less than 1%. The largest ethnic group in Canada is South Asian, representing 28% of the total visible minority population. As in the US, the concentration of ethnic groups in different regions in Canada can affect the use of color, merchandising, diversity of product, signage and other features of retail.

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The federal corporate tax rate in Canada is almost half that of the US.In recent years, the Canadian government has supported businesses by reducing federal corporate taxes, which are now at 16.5%. This rate is expected to fall even further in 2012, to 15%. In the US, the top federal corporate tax rate is 35%.

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Both Canada and the United States have a home ownership rate of approximately 67%.Despite this similarity, 2.2% of all housing units in the US received at least one foreclosure notice in 2010, while less than half a percent of all Canadian mortgages were in arrears in 2010. The stability of the housing market in Canada is one of the factors that help to maintain consumer confidence in the economy. The Canadian consumer confidence index was 83.7 in March 2011; in the US it was 63.4.18

Canadians spend more than Americans on private brand products. Per capita, Canadians spent $334.99 on private brands in 2010, while their US counterparts spent only $287.32. Private brand dollar share of CPG sales in Canada was 18.1% in 2010, versus 17.1% in the US.

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54% of Canadians believe there will be good times ahead for the Canadian economy in the next 5 years.Canadian consumers feeling good about the future of the economy is a positive sign for US retailers entering the market.

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Canada did not become an independent nation, autonomous from British rule, until 1931.One indication of our nostalgia for Britain is our love for the British soap opera, Coronation Street. It is the longest running drama on Canadian television, and although the show never caught on in the US, one in five Canadians watched at least one episode in 2010.

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Canadians love surfing the Net and spend more time online than any other country.In 2010, Canadians averaged 43.5 hours per month online, while Americans averaged 35.3 hours. Canadians also visited on average 95.2 different websites per month, 15 more than their US counterparts.

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There are more donut shops per capita in Canada than anywhere else in the world.Canadians consume more donuts than any other country — typically, they are consumed with one of Canada’s most popular beverages, coffee, which accounts for about 16% of beverage sales.

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Developed in 1958, Canadian Tire “money” — paper bills that act as credit toward purchases in denominations of 5¢ to $2 — is Canada’s longest-running customer loyalty program.85% of Canadians live within a 15-minute drive of a Canadian Tire store.

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In Canada, it’s often a handful of retail chain players that represent the lion’s share of sales in one category.In the supermarket channel, the top three companies, Loblaw Co. Ltd., Sobeys Inc. and Metro Inc. had sales of $57 billion in 2010, representing nearly 70% of total food store sales. For retailers looking to uncover opportunities for expansion into Canada, it is important to understand how the dominant retailers operate their banners.

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With 5.4 million people, Toronto has the highest population of all cities in Canada.Toronto is the 6th largest city in North America. Opening a store in Toronto gives retailers access to a population base comparable to Philadelphia (5.6 million).

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Canada’s unemployment rate is 7.8%*, compared with the US rate of 8.9%. Canada’s employment rate has been quite stable in recent years, and the Canadian government predicts that the unemployment rate will remain around 7% until 2012.

Indications of stable employment rates in Canada point to a prosperous economy and continued spending among its consumers.

*as of March 2011

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Canadians spell like the Brits!Much of the Canadian written language abides by British spelling rules; words like center, neighbor and labeling are spelled “centre,” “neighbour,” and “labelling”, in Canada. Businesses moving into Canada will need to alter packaging and communicat ion materials to accommodate subtle but important differences in how Canadians spell.

Anyone for the “theatre”?

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Canadians are very open to ethnic diversity. While only 77% of Americans approved of interracial marriage, 92% of Canadians are in favor of such unions.Canada generally has a rich culture of racial integration. This is reflected in the wide array of multicultural retail offerings in Canada’s major cities.

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creativestrategyresearch insight innovation

Watt InternationalWho we are and what we do

We are a truly integrated retail agency, with over forty years experience in over forty countries around the world. Working collaboratively with our clients, we use research to help uncover the most meaningful insights, set the right strategies, and deliver results-oriented creative solutions across every brand touchpoint.

We eat, sleep and breathe retail. Through our integrated approach, our clients receive a single-source solution, efficiencies in account management, and a brand experience that’s connected from the first insight to the last creative expression.

If the pieces of your brand puzzle just don’t seem to fit, we’d love to talk with you. Our single-source, best-in-class, integrated retail model works, and we can show you how.

Consumer + Shopper ∙ Research

Financial Analysis ∙Stakeholder ∙

Interviews

Trends + Innovation ∙ Reports

SWOT + Best ∙ Practice Analysis

Need State + Path ∙ to Purchase Modeling

Brand Positioning ∙Marketing Strategies ∙Channel Strategies ∙Product + ∙

Merchandise Strategies

Private Brand ∙ Architecture

Business + Strategic ∙ Planning

Management ∙ Consulting

Performance ∙ Measurement (KPIs)

Brand Name, ∙ Identity + Guidelines

Retail Design ∙Package Design ∙Merchandising + ∙

POP Displays

Integrated ∙ Communications

Brandvertising ∙ TM

Web, Mobile + ∙ Social Media

Total Production ∙ Management

Value Engineering ∙

PAGE 2: Facts about Canada, ∙Niagara Falls Tourist Guide online site PAGE 5: J. Grau, Canada retail ecom-merce forecast: Measured Growth Ahead, eMarketer, February 2011; Research and Markets: Canada B2C E-Commerce Report 2011, Business Wire, March 15, 2011

PAGE 6: J. Klein, It’s not political, but more ∙Canadians are lefties, The New York Times, February 15, 2010

PAGE 9: CIA Factbook ∙

PAGE 10: About Retail; CIA Factbook ∙

PAGE 13: Canadian Moms global leaders ∙when it comes to the environment, Canada Newswire, Natural Marketing Institute, P&G, March 30, 2011

PAGE 14: A. Jones, One-Third of Canadians ∙will be Visible Minority by 2031: StatsCan, City TV/ The Canadian Press/Statistics Canada, March 9, 2010; C.Joseph, Census: Nation now 16% Hispanic, National Journal, March 24, 2011

PAGE 17: L. Whittington/ S. Delacourt, ∙Tory tax cuts could trigger election, January 27, 2011; Elections Canada website; V. Krishna, The tax rate debate, The National Post, March 21, 2011

PAGE 18: P. Viera, Mood of Canadian and ∙US consumers darken, Financial Post, March 29, 2011; Mortgages in arrears, Canadian Bankers Association as of January 2011, March 2011; Record 2.9 million US properties receive foreclosure filings in 2010, despite 30-month low in December, RealtyTrac, January 12, 2011; US Housing Vacancies and Homeowner-ship, US Census Bureau, Wikipedia

PAGE 21: The Nielsen Company, Nielsen- ∙wire, Insights On The Changing State Of Canada’s Private Label Consumer, October 19, 2010; CIA Factbook

PAGE 22: Canadian consumers upbeat on ∙finances, economy, Harris/Decima-Inves-tor’s Group Measure of Consumer Confidence, Harris Decima, March 8, 2011

PAGE 25: D. Groen, Craving Corrie, The ∙Walrus, January/February, 2011; L. Grainger, After 50 years, Coronation Street still strangely popular, Toronto Life, December 8, 2010; L. Barnard, Canadians love their Corrie, The Toronto Star, December 7, 2010; Dr. J.C. Robert, Canada in the Making, University of Quebec, 2005

PAGE 26: O.E. Akkad, Canadians’ Internet ∙usage nearly double the worldwide average, The Globe and Mail/Comscore, March 8, 2011

PAGE 29: My Canada Includes Tourtiere, ∙The Unofficial Sugary Snack, CBC Digital Archives, broadcast date: September 1, 1994

PAGE 30: Answers.com; Collectors cherish ∙Canadian Tire Money, The Star Phoenix, Saskatoon, April 25, 2007

PAGE 33: Canadian Grocer Executive ∙Report, Canadian Grocery Industry 2010-2011, Canadian Grocer & Kraft Foods, 2010

PAGE 34: Statistics Canada; CIA Factbook; ∙Pocket World in Figures, The Economist, 2011

PAGE 37: B. McKenna, Top Challenge for ∙next government, The Globe and Mail, March 23, 2011; T. R. Homan, US Economy: Unemployment rate unexpectedly declines, Bloomberg Businessweek, March 4, 2011

PAGE 41: Majority accepts mixed ∙marriages, August 29, 2007, The Vancouver Sun

Sources

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...And that’s just a peek at the bigger picture.Interested in learning more?

Contact Patrick Rodmell at 416 364 9384 ext 324 or

prodmell@wattintl.com to talk about how we might be

able to support your business.

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