(Special) – The news all seems good for this year’s holiday shopping season as surveys by PwC Canada and Accenture show that Canadian consumers are expected to spend more money and use technology more than they have in past years.
According to the PwC survey, Canadian consumers plan to spend slightly more than they did last year, shelling out $1,583 on Christmas goodies, up 3.7 per cent from last year. However, more Canadians this year — 58 per cent — plan to keep their holiday spending the same as last year compared to 53 per cent in 2017.
The decision on whether to spend more or less this year than last seems to be based on people’s confidence in how well the economy will perform. Those who think it will perform better this year than last over the next six months are likely to spend more. Only 16 per cent expect it to.
Trade protectionism also seems to be a determining factor in people’s spending plans this year with 28 per cent saying it could affect their spending, up from six per cent in 2017.
The Accenture survey found that Canadian shoppers intend to make their gift purchases at Canadian retailers rather than travel to the U.S. or shop with U.S. online retailers, with 41 per cent opting to keep their dollars north of the border, up from 31 per cent last year.
However, the recently-signed U.S., Mexico, Canada (USMCA) trade agreement could change that.
“It will be interesting to see if Canadian shoppers continue to favour Canadian retailers now that the threshold for duty-free items has been raised from $20 to $150 per person for online shopping,” says Robin Sahota, a managing director at Accenture who leads its retail practice in Canada. “While that significant bump gives Canadians a lot more spending power with U.S. online retailers, their preference to shop Canadian could be based on more than price.”
The PwC report notes that the spending increase seems to be driven primarily by men and generation Z, with 53 per cent of millennial dads and 39 per cent of gen-Z consumers upping their budgets for holiday shopping this year. Men will spend an average of $1,752 this year, up seven per cent from last year, while women likely will spend $1,385. Travel continues to make up the largest part of holiday spending followed by gifts and then entertainment.
While buying gift cards is on the rise and growing in popularity, millennials are more inclined to purchase and want to receive physical gifts. Thirty-eight per cent of Canadians compared to 21 per cent of millennials, for example, plan to buy gift cards for others.
The Accenture survey found that there is a major increase in Canadians’ use of Instagram and other social media when planning or making shopping decisions.
The percentage of shoppers who said they plan to use Instagram alone for their online shopping almost doubled since last year to 46 per cent from 25 per cent, with more than half saying they would use YouTube to make shopping decisions or purchases.
The use of social media in general is increasing with 37 per cent saying social media will make their shopping easier when buying for people not on their list, up from 30 per cent in 2017. More than half said they could see themselves buying products online using an artificial assistant tool such as Google Home, Amazon’s Alexa, Microsoft’s Cortana and Apple’s Siri.
The survey also found Canadian shoppers plan to do business with retailers who reflect their values, with 54 per cent basing their purchasing decisions on these factors. Sixty-seven per cent of shoppers say offering a fair and wide range of products that cater to most or all demographics is important and 31 per cent plan to shop at companies which demonstrate social and environmental awareness.
“It’s not just about the lowest price or the most convenient shopping experience; consumers are more socially aware than ever before,” says Kelly Askew, a managing director at Accenture Strategy. “If retailers are able to make some effort to incorporate diversity and inclusion into how they conduct business, Canadians will take notice.”
Talbot Boggs is a Toronto-based business communications professional who has worked with national news organizations, magazines and corporations in the finance, retail, manufacturing and other industrial sectors.
Copyright 2018 Talbot Boggs
Talbot Boggs , The Canadian Press
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