Canadians are planning to tighten their purse strings this holiday season.
As worries grow around the cost of living and a potential recession, Deloitte Canada’s 2023 Holiday Retail Outlook found that many consumers expect to spend less this year.
Projected spend is down 11% from 2022, with decreases in gifts (-18%), gift cards (-14%) and charity (-40%). Twenty three per cent of consumers intend to cut back on their grocery spending.
To win over cost-conscious consumers, Deloitte says retailers will have to look beyond traditional discounting – especially considering 73% of consumers believe retailers are raising prices unfairly, the report says.
In response to price increases, they’ll be shopping around for the best deals (77%) and looking for on-sale items (71%).
Two in three (68%) will buy from a retailer that offers the lowest possible prices, and 71% say they’ll switch brands if their preferred one is too expensive.
Forty-five percent are prepared to visit multiple stores in the same area to get what they need, while 28% say they’ll consider different products and stores before they buy.
READ: Majority of Canadians have ‘substantially’ changed grocery shopping habits
Consumers plan to shop at 37% more stores and websites than last year – and to spend more than they did last year at dollar stores (13%), mass merchant retailers (11%) and warehouse clubs (11%).
E-commerce spending has remained flat since 2021, as consumers plan to spend 41% of their holiday budget online.
Notably, more than half (55%, up from 54% last year) of Canadians say they’re willing to pay extra for sustainable products and services. However, 44% don’t believe most green or sustainable claims made by brands.