E-commerce in retail

E-commerce is a progressively prevalent trend amongst retailers in Canada. Canadian consumers spent $16 billion dollars online in 2010, and researchers are forecasting the online spending to double to $30 billion by 2015 . Shoppers are becoming increasingly comfortable with acquiring high-consideration goods online (e.g. clothing and electronics). Additionally, US retailers that offer greater selection, such as Target and Nordstrom, are beginning to introduce their offerings to the Canadian market, further accelerating the growth in retail e-commerce. This growth represents an emerging, active market for online purchases, which Hudson’s Bay must capitalize on appropriately in order to remain competitive and avoid losing market share.
Hudson’s Bay lacks in online presence and has failed to optimize their website, TheBay.com, for online shopping. Although online sales now constitute ~2% of total sales (increasing from $44m in 2010 to $83m in 2011), it remains well below the ~10% average in the retail industry. Major obstacles that deter online spending include limited product selection and a substandard shopping experience. Key success factors that determine the likelihood of an online purchase involve the site’s functionality, payment processing, product selection and mobile browsing.
In terms of functionality, TheBay.com fails to provide a seamless browsing experience that matches its competitors in terms of its navigation system. Product selection is also inadequate in comparison with its in-store product lines, offering only the most customary brands. For instance, brand names such as Mac, Chanel and Cole Haan are excluded from the online selection. This discrepancy between in-store products and online products prevents Hudson’s Bay from providing a seamless omni-channel experience and will inevitably deter customers from solely relying on theBay.com to fulfill their shopping needs.
Moreover, while Smartphone penetration has reached 45% of the Canadian