Canadian Tire to close online store as of January 29th

Canadian Tire StoreWe had the news for about 10 days now, but decided to delay the publication of this pretty phenomenal end of an era (premature end?) in Canadian Online retailing.

The Canadian Tire Corporation has decided to cease operations of its online store effective January 29, 2009. The news was first released to Canadian Tire partners and affiliates (see full letter after the break) citing concerns surrounding the cost of shipping goods vs. the margins that they have to deal with.

I think this is a big mistake. If CT indeed does decide to revamp their online presence to only be a showcase to get people into their bricks and mortar stores (even if those B&M stores are “within a 10-15 minute drive of 90% of the Canadian population” it marks a major step backwards in terms of retailing trends. Sure, I am one of those folks who double-dipped at the CanadianTire.ca store by ordering a clothes drying rack at 50% off (for roughly $7.99) and applied a free shipping coupon code… what happened? Of course, I wasn’t at home when the shipment arrived, so I went to pick it up at a Canada Post outlet near my home. How much do you think it cost CTC to ship that $7.99 drying rack to me?

I revealed this news about the closing of their online store to a few industry colleagues who understood the underlying premise but agreed with me that it was a poor decision to shutter the entire online operation.

Apparently, as of January 30th, Canadian Tire will only sell “gift cards” online.

One can only hope that they will (at least) maximize the promise of online retailing while limiting transactions to their b&m outlets. They could, theoretically, do this by maintaining all the social / crowdsourcing aspects of their site (user reviews and ratings, etc.) and integrating seamless in-store inventory verification (make it real-time!).

That won’t be easy. Don’t have me surfing your online “store” showing availability at a bricks and mortar Canadian Tire outlet within a “10-15 minute drive” of my home to ultimately arrive at the store and see that it’s OOS (out of stock) or unfindeable, or whatever. Bait and switch will not work with the millennial / Gen-Y crowd.

Personally, I think that CT will have to return to an online delivery model in the near future if they wish to survive. Just have the realities of real world delivery reflected in shipping cost. Sure, if I wish to pay $20 shipping for a $7.99 drying rack, I may think twice. Perhaps I will opt for free ISPU (in-store pick-up) for free.

But please do maintain your online store.

Oh, and stop paying for user “reviews.” (another story, another time.)

As promised, the official news from Canadian Tire:

Dear Affiliates,

Over the past few years, canadiantire.ca has experienced exceptional growth in traffic, making it one of the busiest e-commerce sites in the country. Our research indicates that the overwhelming majority of the traffic to the site is focused on products that are heavily researched, but not necessarily suitable for home delivery (patio sets, tires, etc). This, coupled with the fact that we have an extensive store network with 473 stores located within a 10-15 minute drive of 90% of the Canadian population, led us to the decision to discontinue direct home delivery and to deploy our resources to development of capabilities and features that will significantly enhance the online experience for the millions of customers that visit canadiantire.ca every month.

To continue to deliver on our commitment to provide customers with the best retail site experience, we will continue to invest resources to dramatically enhance the site. In addition to re-launching the site with a brand new look, new navigational functionality and even more ‘how-to’ information for our customers, we will also be introducing in-store pick-up of online orders in a couple of markets later this spring.

Effective January 29, 2009 online sales of product (excluding gift cards) from Canadian Tire’s website, www.canadiantire.ca, will be suspended. The eFlyer program will continue without interruption.

You are welcome to leave Canadian Tire creative banners up on your sites but need to be aware that as of January 30, 2009, commissions can be earned on gift card sales ONLY. Any Canadian Tire creative banners that speak to free shipping codes or purchasing products (other than gift cards) will be deleted from the Linkshare Image Inventory on January 29, 2009. A reminder will be sent to you on January 30, 2009 asking you to review your site to ensure that the Canadian Tire creative banners reflect this change.

We appreciate your understanding in this matter and look forward to working with you in 2009.

Regards,

The Canadian Tire Online Team

1-866-746-7287

Visit CanadianTire.ca.