Financial optimism dominates the outlooks of most Canadian retailers, according to the inaugural Canadian Retail Insights Report, a study conducted on behalf of American Express Canada.
Despite the turbulent economic climate of the past few years, the report revealed 85% of Canadian retailers consider their financial outlook to be positive for the next 12 months, with apparel (95%), fast food (94%) and gas (85%) being the most optimistic.
Nearly two-thirds (64%) indicated they are not worried about the state of their business over the next 12 months.
Merchants were also optimistic about their industries’ financial outlook (80%), with the one exception: the drug store/pharmacy sector, where nearly half (44%) indicated a negative financial outlook for the industry.
Colin Temple, vice-president and general manager of merchant services, American Express Canada, said, “Retail – in all its forms – is often portrayed to be in crisis. What we’re seeing in this report is merchants are more optimistic than anyone might have imagined.”
The optimistic outlook among businesses can be attributed to the fact that more than half (52%) of those surveyed say their sales have grown compared with this time last year, crediting this growth to attracting new customers (72%) and offering new products (56%).
The report revealed that Canadian merchants, regardless of sector, saw a customer demand for excellent service, with 98% of those surveyed revealing customers’ expectations are higher than ever. And with competition heating up in nearly every vertical – 88% said their target customer has more options than ever before – 94% indicated they are placing a focus on providing better customer service to stand out from the crowd.
Besides making investments to improve customer service, merchants plan to drive customer loyalty by focusing on sales and discounts (78%) and expanding product offerings (66%).
“With two-thirds of those we spoke with telling us it’s harder than ever to keep a customer, and nearly every sector looking for innovative ways to attract and retain customers, insight into purchasing behaviour is more important than ever,” said Temple.
“With competition intensifying, merchants can’t rely on intuition or luck to find the silver bullet to keep customers coming back. Rather, they need a firm understanding of what resonates with those who shop at their businesses – and what will appeal to those who don’t.”
