Canadian ecommerce stocks are ahead of the curve on “That Thing”. That thing everyone was talking about long before it happened? Yeah, it happened.
A decade ago, lots of people were talking about making online purchases, but not many of us were actually doing it, at least compared to today. Your own Amazon or NewEgg or Overstock account activity may get you thinking that ecommerce has fulfilled its promise, and it has.
Research firm eMarketer says, worldwide, business-to-consumer ecommerce sales will increase by 20.1% this year to $1.50- trillion. They expect that number will hit 2.34-trillion by 2017.
Canadian ecommerce stocks are in good privco company
With names like Shopify and Beyond the Rack, Canada has made something of a name for itself in ecommerce. But the story is the same across many sectors; in Canada, many of our most interesting innovators are private, not public. Many, but not all. We count down Canada’s Five Most interesting ecommerce stocks, ranked by market cap.
1. Points International (TSX:PTS)
Toronto-based Points International lives at the corner of technology and loyalty programs, which these days is a good place to be. Points International manages the back end of loyalty currencies, frequent flyer miles, hotel points, retailer rewards and credit card points. The company has more than fifty partners worldwide including Delta, BestBuy, Starbucks and PayPal. Points has grown its revenue from $30 million in 2007 to the $202.3-million it reported for fiscal 2013 yesterday.
2. Coastal Contacts (TSX:COA)
Founded in the midst of the “dot-bomb” era, Vancouver-based Coastal Contacts became nothing less than the world’s largest online retailer of contact lenses and eyeglasses before selling itself to Paris-based Essilor International for $435-million last week. Coastal had grown its revenue from $153-million in fiscal 2010 to $217.5-million in 2013. The company recently announced it would launch a line of frames later in 2014 that will be compatible with currently hot, but decidedly non-prescription, gadgets like Google Glass and Samsung Gear Glass.
3. Mediagrif (TSX:MDF)
Founded in 1996, Longueuil, Quebec-based Mediagrif offers a range of e-commerce services through B2B platforms such as The Broker Forum, Power Source Online, and Carrus Technologies. The company became increasingly profitable as it grew its revenue from $47.9-million in 2009 to $53.8-million in 2012. In its recent Q2, 2014, Mediagrif earned $2.81-million on revenue of $16-million. That makes the company one of the most profitable per employee techs in the country.
4. Guestlogix (TSX:GXI)
Guestlogix was formed in 2002 and has since become the dominant player in the business of delivering ancillary revenue to airlines, with contracts to service more than a billion trips annually. Those little extras; a fee for your second bag, a surcharge for reserving your seat in advance, are actually saving the airline industry, producing close to $60 billion in revenue last year. Without this extra revenue, the flying business would still be a losing game. But Ilia Kostov, GuestLogix’s Executive Vice President for Global Sales and Product Strategy says this may have already peaked and that the company has focused on the next stage of travel, which he thinks will be more personalized. “When you take a look at the ancillary revenues for airlines, from the more traditional services like baggage fees, etc., you see that they have plateaued. The growth in ancillary revenues is now from services that are perceived by passengers as adding real value and something that they desire, something that they want.”
5. Ackroo (TSXV:AKR)
Ottawa-based Ackroo began with a rethinking of the digital electronic payment interchange platform, where co-founder Eamonn Garry, a veteran of Canadian tech companies such as RIM, Nortel and Bridgewater Systems, looked to apply his considerable knowledge of the telecom sector’s changes to a space he felt would undergo a similar evolution. The result is a solution that allows small and medium sized business to implement loyalty programs that can compete with national and international firms without breaking the bank. Today, Ackroo boast more than 650 customer merchant locations and recently inked a deal with Vista Cinema.