Sears, Toys r Us, Danier, Aeropostale, Smart Set, Jacob, Target, Future Shop – the list of major retailers who have closed up shop in Canada or drastically shrunk their footprint is numerous. The causes of decline are many, but time and again a shift by consumers from bricks and mortar shopping to online is listed as a factor.
Canadians vie with their American neighbours as the heaviest internet users in the world, and this has changed how we buy things. Last year we spent over $20 billion online. Mainstays, like hotels, books and clothes have been joined by groceries and medication. There’s very little that can’t be purchased online, but for the longest time beer fell into that category.
There’s a change underway. The LCBO, Ontario’s venerable leviathan of the alcohol retail scene, launched its e-commerce site in 2016. This followed hot on the heels of its Quebec cousin, SAQ, which launched its site in 2015. President and CEO, Alain Brunet, admitted that change was needed, “The retail business has changed so much. It forces us to do things differently.” The LCBO’s rationale was the same – it did so because of a “commitment to innovation, customer service and continued success in a changing marketplace.” Reading between the lines in the either comment and it’s clear that both retailers realized they needed to get with the times and provide an increasingly mobile audience with more convenient shopping methods.
The LCBO site launch received a muted launch from urban beer dwellers. The large urban centres in the province have seen exponential growth in the availability of a wide range of craft beer, and in many cases, the selection made available at the LCBO didn’t differ from some of the better stores in the area. Move beyond the cities, and the impact of this development become more profound. Starved of craft at the retail level and with a limited number of homegrown breweries, the emergence of an option that could provide you with the same selection as the big city dwellers was a game changer. By selling online and normalizing beer in the mail, a precedent had been set, which many craft brewers are beginning to follow.
Jake Baranik works in Marketing for Sawdust City, the latest operation to open up shop online and offer shipping. Launching at the tail end of November, the store offered up an adventurous lineup, including a milkshake IPA, imperial stout and barrel-aged saison. The ability to reach a wider market is one of the biggest pluses of opening an online store, whether offering mainstays to locations not served by traditional retail, or branching out with brews traditionally online available at the brewery. Baranik explains, “Since opening our brewery in downtown Gravenhurst we’ve been receiving messages from fans throughout Ontario seeking our limited release beers. Our online store now allows these brewery-exclusive brews to reach people throughout Ontario”.
By opening their own e-commerce sites, breweries are able to provide drinkers with a different expression of their art. Despite some increases in selection, most of the LCBO’s lineup sticks to core brands. As Baranik points out, this is a limited selection of what most Ontario breweries have to offer, and an online store allows them “to give people access to Sawdust City brews that are not available in the LCBO, The Beer Store and Grocery channels.” Sawdust isn’t alone – as of writing, you can purchase 11 Dominion City beers not available at traditional province-wide retail, and 8 from The Exchange Brewery. These two breweries from Ottawa and Niagara have a relatively small presence outside of their home base, and online retail is a great way for people to learn more about them.
The provincial governments of Ontario and Quebec certainly hope that by increasing section and access, they will see an uptick in revenue. In fact, Ontario Finance Minister Charles Sousa estimated that online sales will add somewhere between 15 and 20 million dollars in revenue to the LCBO’s bottom line. A small number compared to overall revenue, but not an insignificant one. Shipping for both the province and brewers also helps Canada Post, as it seeks to grow its parcel business to offset declines in the direct mail and lettermail parts of its business. The benefits reach far beyond the immediate consumer.
Canadians have embraced online shopping, and in the past couple years we’ve seen great steps in many parts of Canada. With large retailers and small brewers joining the mix things can only grow from here. For now, though, the brewers who have taken the plunge are struggling to keep up with our thirst for suds in the mail. “We’ve exceeded our monthly supply of packaging materials in the first few days”, says Baranik. Best order more supplies, because this genie isn’t going back in the bottle, and I just placed my first order.