How Canadians feel about cross-border ecommerce

Canada presents a huge opportunity when it comes to international ecommerce. But many people are still hesitant to make purchases across borders. We know this because we talked to several Canadian shoppers to understand how they feel about buying from international brands. Here’s what they had to say.

Understanding the Canadian ecommerce landscape

Canada is in the top three markets where cross-border shopping is highest. While this is a huge opportunity, we found from our conversations with Canadian shoppers that there’s still a lot of hesitation around making international purchases - and many do so only when there aren’t better options locally. 

For instance, according to one shopper: “I’m consistently buying items from Canadian brands and would consider this extremely important in my shopping journey. Occasionally, I’ll purchase from international brands when there’s truly no Canadian alternative.”

So what exactly is it that’s keeping Canadian shoppers from feeling more comfortable with international purchases? We noticed three common themes in their responses.

What’s keeping Canadian shoppers from shopping internationally?

Returns

International returns introduce challenges that aren’t as common with domestic returns. Sending returns across borders takes longer, is more expensive, and requires customers to fill out tons of paperwork to start the process. Unfortunately, many brands aren’t adequately set up to handle international returns and they push the problem to the customer asking them to bear the brunt of the issue.

One Canadian shopper shared a negative return experience she had after making an online return with an American brand: “I bought a Christmas present and had to exchange it, so I filled out the form they provided and packed it with the box. They didn’t pay for return shipping, so it cost me $30. It said that it would take about four weeks to process. After four weeks, I heard nothing from them, so I reached out to ask for an update. They then re-asked me all the questions on my form and sent out the exchange. It made me wonder if I ever would have received my exchange if I didn’t follow up.”

Shipping costs

International shipping is expensive. The cost alone can deter people from making a purchase in the first place, as one shopper describes: “I’ve been looking at purchasing a specific set of Vinyl for my car that seems only to be sold in the states. I’ve put off this purchase so long (half a year now) because it ends up being extremely expensive when shipped to Canada. The shipping cost is more expensive than the product itself!”

Another issue is that international shipping costs aren’t always transparent for Canadian shoppers. For example, many brands will boast about free shipping on their websites. Canadian shoppers get excited to see this, only to discover at checkout that this doesn’t apply to international shipments. Similarly, these costs often aren’t translated to CAD, making it challenging to understand the price upfront. 

Customs duties

There are added costs, such as customs duties, that come with moving any goods across the U.S. and Canada borders. The problem with these taxes is that it’s difficult to understand how they’re calculated and can result in “surprise” fees that significantly increase the overall purchase price. One of the shoppers we talked to shared an incident as an example.

“There were duty charges from the Canadian Government with additional HST and another additional charge from FedEx. I never understood it completely, but all I know is that my $100 US shoes turned into $238 CDN by the time it was all said and done.”

How to appeal to Canadian shoppers

Based on the responses of the Canadian shoppers we talked to, there are two strategies you can put into action that will help your brand mitigate the most common concerns.

1. Make international returns convenient. 

When it comes to online returns for Canadians, your goal should be to close the gap between the domestic experience and the international experience. How? Focus on convenience. There are a few ways you can accomplish this: 

• Make your international return policy accessible. 67% of shoppers check a return policy before making a purchase. This percentage is likely higher for international shoppers, who have more to risk. Knowing this, don’t just bury your return policy deep in the FAQs section - make it visible and accessible. According to one shopper: “If an international brand mentions their Canadian policies front and center on their website before I get to the cart, that would make me much more likely to purchase from them.”

• Be proactive. You also want to avoid potential headaches for customers by proactively addressing their questions. To do this, create a list of concerns your Canadian shoppers are likely to have and address them on your return policy page. If you need inspiration, take a note from one of the shoppers we spoke with, who said: “Things that I consider are: Is the return window from order date or delivery date? Do I have to pay for return shipping, or will a return label be provided? Do they offer refunds, store credit, or exchanges?” You can also check out our post on the most important questions you need to answer in your return policy. 

• Make the return process as easy as possible. Similarly, you want to make the return process is as easy as possible. Many brands will put the burden of the process entirely on the customer, making them fill out the customs forms or email a support team member to get the return label. That’s where a platform like Loop, which automatically generates everything for the customer, comes in handy.

2. Be transparent about cost

Not every brand can cover the cost of international shipping for their customers, and that’s ok! When it comes to pricing, you can still make your customer’s lives easier by being transparent. In particular, one shopper suggests: “Find a way to make the customs and import fees clear.” 

If you’re looking for a creative way to accomplish this, take a look at this chart below. It clearly lays out all the associated fees for the various countries it ships to, making it easy to understand the cost at a glance. So even if the shipping fees are pricey, you’re instilling trust in the customer by being honest, which makes it much more likely that they’ll make a purchase.

At Loop, we’re thrilled to introduce Cross-Border Returns, which will let your customers ship returns effortlessly across international borders to drive loyalty, repeat purchases, and create a competitive advantage. If you’re a U.S. brand selling into Canada, or a Canadian brand selling into the States, sign up for our early access.