understanding the canadian marketplace
TRANSCRIPT
Understanding The Canadian
MarketplaceA Buxton Webinar
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What We SeeIn The Canadian Market
What We LearnedFrom Target
What We HearWhile Working With Our Clients
What We DoTo Help You Succeed
Who We AreThe Buxton Solution
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RelationshipsSome of the Fastest Growing Brands Partner with Buxton
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ReputationAward-winning Business & Analytics
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We Define WHOYour Best Potential Customers Are
WHO
We Identify WHEREYour Best Potential Customers Are Found
WHERE
We Tell You The VALUE Of Your Best Potential Customers
VALUE
The Buxton SolutionWho, Where, Value
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80,000Sites Evaluated In
The Last 12 Months
7,500Stores Opened In
The Last 12 Months
ResultsTremendous Influence on the Retail Industry
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What We SeeIn The Canadian Market
What We LearnedFrom Target
What We HearWhile Working With Our Clients
What We DoTo Help You Succeed
Who We AreThe Buxton Solution
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1.18%
-2.71%
3.37%
2.53%
1.71%2.02%
2.27%2.45% 2.36% 2.22% 2.08%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
GD
P g
row
th c
om
par
ed t
o p
rio
r ye
ar
Canada: Real GDP Growth Rate From 2008 To 2018 (Compared To Prior Year)
2008
2009
2010 2011 2012 2013 2014 2015 2016 2017 2018
What We See in the Canadian MarketA Stable, Attractive Economy
GDP Growing at 2.45% in 2015
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What We See in the Canadian MarketA Stable, Attractive Economy
Inflation Averaging 1.64%
Source: http://www.inflation.eu/inflation-rates/canada/historic-inflation/cpi-inflation-canada.aspx#sthash.3kc6J88B.dpuf
1.67%
2.38%
1.16%1.32%
2.35% 2.30%
0.83%
1.24%
1.47%
2006 2007 2008 2009 2010 2011 2012 2013 2014
Annual Inflation (Dec vs. Dec)
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What We See in the Canadian MarketA Stable, Attractive Economy
Unemployment Rates Dropping
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8.5
8
7.5
7
6.7
6
5.5
9
8.5
8
7.5
7
6.7
6
5.5Jan / 01 Jan / 04 Jan / 07 Jan / 10 Jan / 13
Canada Unemployment RatePercentage of the Labor Force
Source: http://www.tradingeconomics.com/canada/unemployment-rate
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What We See in the Canadian MarketA Stable, Attractive Economy
Population Growth Largely From Immigration Versus Natural Birth Rate Drives Diversity
Source: http://www12.statcan.gc.ca/census-recensement/2011/as-sa/98-310-x/2011003/fig/fig3_1-1-eng.cfm
0
0.2
0.4
0.6
0.8
1
1.2
1991 to 2001 2001 to 2011 2011 to 2021 2021 to 2031 2031 to 2041 2041 to 2051 2051 to 2061
Population Growth Rate (%)
Natural Increase Migratory Increase
%
%
%
%
%
%
%
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What We See in the Canadian MarketIncreasing Urbanization
45%
55%
00
80%
20%00
Canadians in Urban Centers
1911 2011
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What We See in the Canadian MarketDemographics Diverging from U.S.
60%Asian Descent
30%MexicanDescent
Differences in immigrant citizens shifts cultures differently
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What We See in the Canadian MarketA Stable, Attractive Economy
Retail Sales Growth of 4.7%
10%
5%
0%
-5%
-10%
10%
5%
0%
-5%
-10%
Jan / 02 Jan / 04 Jan / 06 Jan / 08 Jan / 1 0 Jan / 12 Jan / 14
Canada Retail Sales YOY
Source: http://www.tradingeconomics.com/canada/retail-sales-annual
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What We See in the Canadian MarketHigher Spending Habits
Home Ownership Food & Alcohol Clothing
Shoes Reading Material
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What We SeeIn The Canadian Market
What We LearnedFrom Target
What We HearWhile Working With Our Clients
What We DoTo Help You Succeed
Who We AreThe Buxton Solution
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What We Learned from TargetTarget Had Reasons To Be Optimistic
10%
10% of Canadians Shopped in a U.S.-based Target
70%
70% of Canadians Were Familiar with the Target Brand
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What We Learned from TargetQ & A
Question: With a head start in brand recognition and penetration, why did things go so badly so quickly?
Answer: They were opportunistic instead of prepared.
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What We Learned from TargetCompetitors Look Different
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What We Learned from TargetCustomer’s Experience with Target Was Different in Canada Than in U.S.
Higher Pricing Than Expected
$
Missing Expected Brands Frequent Stock Outages
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What We Learned from TargetInconsistent Brand Identity
=
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What We Learned from TargetIn Summary
• Consumers spend money on different things
• Competitors were not well known & competed on different bases
• The Target experience provided was different than the U.S. experience:• Location Quality• Pricing• Merchandise Mix• Stocking Reliability
Target Locations in the U.S. & Canada
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What We Learned from TargetLessons Learned
Recognize that meaningful differences do exist between the U.S. and Canada
Expect to customize the merchandise mix to meet local tastes and needs
Plan to grow at the pace of your learning
It is better to be prepared than fast
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What We SeeIn The Canadian Market
What We LearnedFrom Target
What We HearWhile Working With Our Clients
What We DoTo Help You Succeed
Who We AreThe Buxton Solution
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What We Hear While Working With Our ClientsDifferences That Require Preparation
Customers Value & Expect A Higher Level Of Service
Labor LawLabeling & Signage
Differences
French Language In QuebecDifferent Competitors Less
UnderstoodSignificant Intra-country
Differences
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What We Hear While Working With Our ClientsA Few Big Players, But Mostly Fragmented
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What We Hear While Working With Our ClientsDoing Business In Canada Can Be Very Profitable
Square Foot
Sal
es
14Sq. Ft. of
Shopping Floor Area
CANADA
23Sq. Ft. of Shopping
Floor AreaUNITED STATES
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What We Hear While Working With Our ClientsYet, Canada Represents the Easiest Form of International Growth
Success in Canada
• The Incumbents
• Acquire to Win
• Slow & Steady
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What We Hear While Working With Our ClientsWho Is Moving Into Canada Successfully & How?
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What We Hear While Working With Our ClientsEntering Canada Via Acquisition
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What We Hear While Working With Our ClientsBuilding Slowly, But Surely
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What We SeeIn The Canadian Market
What We LearnedFrom Target
What We HearWhile Working With Our Clients
What We DoTo Help You Succeed
Who We AreThe Buxton Solution
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What We Do To Help You SucceedBuxton Can Help You…
• Make Wiser, More Informed Decisions
• Find The Best Opportunities & Avoid Making Costly Mistakes
• Understand Your Existing Customer Base(s)
• Discover Differences Between Canadian & U.S. Customers
• Understand Their Potential Value To You
• Forecast Potential Location Performance
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Have Questions?Let’s Talk.
1-888-2BUXTON
www.buxtonco.com