Canada-U.S. border officials are set to see a marked drop in the volume of southbound traffic during the U.S. Thanksgiving weekend as Canadian consumers change their purchasing habits. UPS Canada’s annual Black Friday survey conducted by Leger shows that fewer Canadians are taking their holiday shopping list cross-border for U.S. Black Friday deals.
This U.S. Thanksgiving, the number of Canadians who are likely to buy goods from the U.S, either online or by cross border shopping, has dropped by 22 per cent since 2014 (37 per cent vs. 29 per cent in 2015). Shoppers are aware of the economy and among consumers unlikely to purchase from the U.S. during Black Friday, the unfavourable exchange rate (56 per cent) is listed as the top reason. On par with 2014, consumers unlikely to shop in the U.S., prefer to shop Canadian (39 per cent) and one quarter highlight that local retailers are offering Black Friday sales (26 per cent).
“In the past, we’ve seen Canadian consumers flock across the border to take advantage of Black Friday deals, but this year 84 per cent are unlikely to cross-border shop,” said Craig Calvert, director of customer solutions, UPS Canada. “The market is changing and Canadian retailers have an opportunity to take advantage of consumer’s preferences to shop local by offering aggressive Black Friday deals to keep and grow their market share in Canada. As Black Friday continues to gain momentum north of the border, retailers will be forced to participate in the price slashing to meet consumer expectations, especially among Millennials who are most likely to shop south of the border.”
Today’s consumers are big online shoppers and 85 per cent of Canadians shop online, especially from the comfort of their home office (32 per cent) and living room (29 per cent). On par with 2014, one-third of shoppers will use an e-commerce site of a Canadian retailer to benefit from Black Friday sales (34 per cent).
Millennials between the ages of 18 and 34 are most likely to purchase online or cross border shop with U.S. retailers. Consumers who plan to purchase from U.S retailers during Black Friday expect to save on average $168, which is significantly less than the expected savings in 2014 ($249). Holiday gifts don’t appear to be a priority as more than half of Canadian consumers (54 per cent) will shop this U.S Thanksgiving to purchase goods for themselves compared to a partner or spouse (34 per cent).
To maximize the potential for long-term gain, particularly amongst online consumers, retailers will need to pay careful attention to the post-purchase experience. Canadian online shoppers highlight that their online shopping experience could be made better through:
- Transparent shipping fees (70 per cent)
- Transparent duty fees (53 per cent)
- Text or email alerts of shipment status (34 per cent)
- Pick up of packages at a convenient location (27 per cent)
These conveniences are now being offered through the UPS My Choice™ service and UPS Access Point™ locations which were launched in 2014. UPS My Choice service is a new home delivery option that will enable busy consumers to conveniently control and manage their incoming package deliveries to fit their busy lifestyles. The service, combined with approximately 900 UPS Access Point locations across Canada, will alleviate many consumer concerns related to shipping, including missing packages, worrying about packages left outside, trekking to a depot to retrieve missed packages, waiting all day for a package or counting on others to sign for a package.
World-wide, UPS expects to deliver more than 630 million packages between Black Friday and New Year’s Eve, an increase of more than 10 per cent over holiday deliveries last year. In addition UPS predicts to deliver 36 million packages globally on its peak day of Dec. 22.
UPS Canada has increased its sort and delivery capacity in preparation for high volumes over the peak holiday season. This includes approximately 200 new package cars, expanded domestic air capacity and next-generation sorting capabilities in Toronto, Calgary and Vancouver.
“Black Friday is the kick-off to our peak season, which is an important time for UPS and our customers,” says Craig Calvert. “Our planning, investments and lessons learned from previous years has ensured we are prepared for the upcoming holiday season.”