SNAPSHOT OF CANADA 2007

The Political Scene

Stephen Harper's Conservative minority government is on track to becoming the longest-standing minority government in the nation's history. Defying rumours throughout his term that he would push for early re-election, Harper and his government have instead continued to drive forward an agenda of fiscal restraint and cautious foreign policy while receiving lukewarm but steady support from the Canadian voters who placed him in office.

Looking ahead, there remains a chance of an early election during 2008, although the term of the current minority government does not expire until October 2009. Pundits predict that the Conservatives would likely return to government after an election, spurred by a fragmented opposition, but may very well fall short of a majority in parliament yet again.

The Economy

Soaring demand from abroad for its commodities means that Canada's economy, especially the oil sector, is still booming. Canada's biggest economic story of 2007 was certainly the ascent of the loonie, resulting from this worldwide demand. On September 21, 2007, the Canadian dollar overtook its American counterpart in value for the first time since the mid 1970s, the culmination of a steady rise since an all-time low against the US greenback in 2002.

However, despite Canadian pride and consumer confidence in the face of the rising loonie, the strong dollar has put a strain on Canadian exporters, including the auto manufacturing sector so critical to Ontario's economy. The Canadian currency's too-rapid rise in late 2007, along with the significant uncertainty in the world economy, have fuelled some jitters about the Canadian economy.

Still, Harper and his government addressed these fears in late 2007 by noting that Canadian unemployment levels were at lows not seen since the early 1970s, and that Canada's tax rates had not been this low since the early 1960s. The general government balance remains in surplus for the foreseeable future, and Canada's public finances will continue to be healthy.

Direct Response Marketing

Buoyed by strong economic returns and low unemployment rates, Canadian consumer spending was once again on the rise in 2007, and reached its highest levels since the technology boom of the late 1990s. In addition, the flight of the Canadian dollar meant that consumer purchasing power increased, which in turn ensured that the Canadian consumer marketplace drew renewed attention from marketers from south of the border, as well as from Asia.

To be sure, marketing remains fiercely competitive in Canada, as it is across the developed world, with a plethora of products and services on offer in a fragmented consumer and buyer universe. As a result, direct response marketing has continued to appeal more and more strongly to marketers who seek to connect directly with their prospective customers. Highly quantifiable direct response disciplines such as e-mail, direct mail and search engine marketing are expected to remain more important than ever in 2008.

However, marketers will certainly be poised for change in the telemarketing sector, due to the introduction of Canada's national do-not-call registry planned for 2008. The initiative, which was developed and spearheaded by the CRTC, Canada's regulator of the telecommunications and broadcast sectors, will be implemented by Canada's national telecommunications company, Bell Canada, and is expected to be fully operational by September 30, 2008.