Consumers across Canada are gearing up for a more sustainable and financially prudent holiday season, according to the latest EY Consumers of the Future Index survey. As health concerns related to the COVID-19 pandemic begin to fade, cost-of-living and environmental concerns escalate, prompting Canadians to be more concerned about the country’s economy (93%) and their personal finances (84%).
“Although consumers feel the threat of COVID-19 is fading, they are concerned about the rising cost of living affecting how they allocate their disposable income,” said Monica Chadha, Chief Commerce Officer. retail at EY Canada. “In the face of price increases, Canadians are not just opting for cheaper private label products, they are also choosing to buy less, all together.
Consumers are optimistic despite the economic difficulties
Overall, Canadians are optimistic about the future: 74% are looking forward to “getting back to normal” and 48% are looking forward to catching up on experiences they missed due to the disruption caused by the pandemic. However, 62% indicate growing concerns about the rising cost of living.
That’s why shoppers are approaching the holiday season and beyond with a desire for rewarding experiences, without breaking the bank. Almost half of respondents are choosing not to increase spending on family and more than a quarter plan to spend less compared to last year – this is especially true when buying gifts for friends (40 %).
Meanwhile, when it comes to celebrations, 56% of Canadians plan to travel to reunite with loved ones in the next six months. Alternatively, 41% plan to spend less on vacation trips during the holidays because rising fuel costs make travel more expensive.
Consumers hold on to their values until the new year
Resilient consumers aren’t giving up on their desire to live sustainably while on vacation and are instead turning to more cost-effective ways to achieve it. Whether buying fewer physical goods (42%) or buying locally (30%) and choosing gifts with less packaging (40%), shoppers are taking control by optimizing at the both economic and environmental benefits.
“Consumers see the holiday season as an important opportunity for them to positively express their social values, in what they buy and in the way they bring people together,” says Elliot Morris, head of grocery and consumer packaged goods at EY Canada. “With more income now needed just to cover the basics, consumers increasingly want to make informed decisions about the products they buy and are looking for more information from trusted sources to support this.”
With increasing environmental concerns, Canadians are looking for ways to reduce their consumption. More than a quarter will buy less food and alcohol for holiday meals to avoid waste and 44% plan to use less lighting and party decorations at home to save energy. Notably, 70% of consumers across Canada don’t feel the need to keep up to date with the latest fashion trends and more than half don’t feel the need to keep up to date with the latest gadgets and technology. When it comes to buying criteria, 42% say they now care more about the usefulness and longevity of the products they buy.
“As consumers bring new values into this shopping season and into 2023, saving consumers money and driving sustainable efforts should go hand in hand for retailers looking to bridge the gap between action and intention,” adds Morris.
To learn more about the EY Future Consumer Index, click here.