From her perch behind the counter of her Bloordale notions shop, facing Bike Depot and The Cell Phone Clinic, next door to A2Z vacuums, Shelley Town is apologetic about the fact that her business doesn’t have a robust online presence.

Sure, she has a website, at Townthestore.wordpress.com and she posts to Instagram, Facebook and Twitter and yes, social media has driven sales for her, but as for a transactional, in-real-time website, well, she’s not there yet.

“It’s on the list obviously, but I’m here six days a week,” says Town, who also ran Pulp at the Carrot Common and Butterfield 8 on The Danforth.

She moved to her new location, called Town, at 1187 Bloor St. W. nearly four years ago, selling hip gifts and greeting cards and party supplies and other bibelots.

“Day-to-day managing, buying, and customer service has been the priority until now,” says Town. Some people starting out in retail sales today would begin online, and then, perhaps, move into bricks-and-mortar, Town points out. But she started out in retail about 15 years ago, before the steep rise of online retailing.

“Because I’ve operated all the stores I’ve owned, to me, the store environment, the look and feel of it is where I start, because it’s all I’ve known,” she says.

Canada has become a digital nation but main street retailers have not followed suit and are facing long odds when they do try to compete online, according to a report by Yellow Pages Limited, called Cities as Warehouses, The Survival of Main Street in a Digital World.

“Big retailers ... are well-oiled SEO and SEM machines with the resources to devote to upkeeping and adjusting campaigns as technology and digital marketing evolve,” according to the report, referring to search-engine marketing (SEM) and optimization practices (SEO).

SEM and SEO affect which listings pop up first in online searches.

“Combine this with the shrinking profit margins experienced by many smaller retailers, and the reality of retail in the face of the rising digital competition looks stark on streets and in malls from sea to shining sea,” according to the report.

The report comes as Yellow Pages, which used to print 30 million Yellow Pages books a year for distribution in Canada and now prints 10 million, is itself struggling to find purchase in a marketplace that has been reshaped by online commerce.

“Ninety per cent of Canadians search online before shopping — that means any digital retailer will be able to grab Canadian (consumers) before they even think about shopping locally,” said Julien Billot, president and CEO of Yellow Pages, in an interview with the Star.

Canadian retailers are an estimated two years behind their U.S. counterparts in adopting online technology, according to the report.

The potential is there — according to the Yellow Pages report, Canada is one of eBay’s most successful markets, with Canadians spending more than $1 billion buying goods from the site each year.

While price is the main reason Canadians shop online, especially for commodities, they are also willing to spend a little more — but not much more — to shop locally in a store they like, especially if it has sales associates with deep product knowledge.

“If retailers can add a level of fun — a shopping experience — then they are more likely to seduce people and encourage physical shopping and perhaps sell at a slight premium,” said Billot.

Billot said local retailers also need to give up the idea that they are competitors and unite to compete as a bloc against global retailers.

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The report suggests a local digital marketplace as a possible solution, and Yellow Pages as the company to help create and federate a local marketplace.

Yellow Pages books used to be distributed to every home in Canada, providing a resource for residents trying to find local goods and services, but the books are now mainly distributed in rural locations and at kiosks in cities.

The service is now offered online and is available as an app.

While it had more than 400,000 customers in 2008, Yellow Pages has 244,000 today and has acquired several online properties, including dine.TO and ComFree.com, to build a client base in the food and real estate sectors.

Retailers no longer own the shopping process from beginning to end, and even small retailers need a strong digital game, says Shelley Bransten, senior vice-president, retail, for Salesforce, a customer relationship management (CRM) software company.

“I absolutely think you have to be online because that is where the consumer is, that is how the consumer is going to know you, research you, and check-out and purchase. You have to be where the consumer is,” said Bransten.

“I don’t think a small business can go about building its own infrastructure, the pace of change is just too fast.

24 per cent of Canadian retailers don’t have a website

89 per cent of Canadians buy online.

146,000 retail locations in Canada

Over the nest two years, 48 per cent of Canadians plan to increase their online shopping.