The Inuit and The North West Company

Lily Lin put down the paper she had been reading at her desk in the head office of the North West Company. The story she just finished reading had highlighted the growing concerns the Inuit people had with the pricing of products available for purchase in the three Canadian territories (i.e., the Northwest Territories, Nunavut, and Yukon). A number of Inuit had vocally expressed their displeasure with the high prices that businesses were charging for everything from fresh produce to apparel items. Lily knew this negative word of mouth might need to be addressed, since the North West Company was the largest retailer in the Canadian Arctic. Indeed, since she was a public relations spokesperson for the company, the news media would likely contact her for the company perspective on these issues.

The North West Company

The North West Company (www.northwest.ca) is a grocery and general merchandise retailer with numerous stores scattered in remote communities across northern Canada and Alaska. Primarily operating under the name Northern Stores (also AC Value Centre and Giant Tiger retail brands), the company had been operating in the Arctic for decades. In fact, the company traces its history to the fur trading business in which it operated independently in the eighteenth century. It was merged into the Hudson's Bay Company in 1821 and was part of that company's business portfolio until 1987, when it was relaunched as a publicly traded company under the old name of the North West Company.

The company, headquartered in Winnipeg, Manitoba, employs over 45 000 workers and is the largest employer of Aboriginal people in the business sector. It's also one of the longest continuing retail operations in the world, with a number of stores having continuously served their communities for over 300years. These stores operate in communities that have populations ranging from 500 to 7000 and that are typically about 700square metres in size. They are unique with respect to their merchandising, as they have to adapt the product mix to each market served. Generally, the company will offer food, family apparel, housewares, appliances, and outdoor products. The company has also developed specific logistical expertise in moving product to, and operating stores in, remote or difficult-to-serve locations.

The Inuit

The Inuit are a group of indigenous peoples who inhabit the Arctic regions of Greenland, Canada, the United States, and Russia. They live throughout most of the Canadian Arctic, particularly around the Arctic Ocean. Inuit are the descendants of the Thule culture, who emerged from western Alaska after crossing the land bridge from Asia and spread eastward across the Arctic. The Inuit have chiefly been fishers and hunters, and their traditional diet is typically very high in protein and fat. In fact, Inuit used to consume an average of 75 percent of their daily energy intake from fat. Their culture is very distinctive in many things, from transportation methods to language and art. Inuit introduced sealskin boats, which were extraordinarily buoyantthe predecessor of the kayak. On land, the Inuit used dog sleds for transportation.

Although Inuit life has changed significantly over the past few decades, many traditions continue. The Inuktitut language is still spoken in many areas of the Arctic and is common in media programming. Canada has adopted some of the Inuit culture as national symbols, for example using the cultural icon of the Inukshuk as a symbol of the 2010 Winter Olympics. Respected art galleries display Inuit art and music recordings. Storytelling specific to the Inuit culture has also been preserved.

Over the past few decades the Inuit have undergone an identity struggle between their traditional heritage and the modern society their cultures have been forced to assimilate into in order to maintain a livelihood. With current dependence on modern society for necessities (including governmental jobs, food, aid, and medicine), the Inuit have had to come to terms with changes in their cultural heritage. They have had to adopt new consumption patterns and have experienced both positives and negatives in doing so.

Pricing Problems

Changes in consumption had led to the current hostility toward what some had called price-gouging of the Inuit people. Communities had become outraged at the skyrocketing costs for basic groceries and necessities in Nunavut. With the prices ofred peppers starting at $16.89 per kilogram or a box of 84diapers at $73, almost all imported goods had become much more expensive in the past few years.

While there was a recognition that transportation and inventory costs were likely to increase the costs of goods sold in the North, there was a deeply held suspicion that the northern people were a captive market being taken advantage of. Publicly, the Inuit had been clear they wanted a solution to the issue and didn't see moving south to bigger population centres as a reasonable option. Further, traditional hunting also didn't make sense, as the costs had become prohibitive and global warming had caused movement in animal populations. Some had called for increased competition so that people could shop comparatively and be offered lower prices. At minimum, people wanted more information to understand how transportation costs were impacting pricing, and what price fairness meant in the Arctic.

Lily knew that the North West Company, as the primary retailer in the Arctic, was at the centre of this issue. How to handle the expressed concerns of these frustrated customers was critical. Lily had noted that people had set up websites and blogs, and had even travelled to Ottawa, to voice their concerns. The questions soon to come had to be handled correctly and effectively.

• Is the Inuit subculture a regional or ethnic subculture? How would you categorize this group of people? Why?
• What specific needs does the Inuit subculture have? How are they different from those of other subcultures in Canada?
• Given the specific needs of the Inuit, how should the North West Company market to this population? What aspects of the marketing mix need to be shaped for this market? In what ways?
• Do you feel the concerns expressed by the Inuit with respect to product pricing are valid? How would you address this concern if you were business? Government? The Inuit population?