A survey by Lightspeed Commerce captures unique insights into how Canadians are navigating economic pressures while continuing to spread holiday cheer.
The survey also sheds light on how generational differences influence shopping habits.
Some of the key findings:
- Social Media Shopping Boom: Over one-third (35%) of Gen Z and young Millennial Canadian shoppers use TikTok as their top shopping resource, highlighting a major shift in retail engagement;
- Instant Gratification over Costs: 55% of Gen Z and young Millennials are willing to pay above the sticker price to avoid waiting for restocks;
- Retail Tipping Trends: 53% of Canadians are willing to tip retail staff for exceptional service, with this figure rising to 83% among Gen Z shoppers. This demonstrates a significant willingness to show appreciation, despite economic pressures;
- Budget Considerations: Due to tighter budgets, 38% of Canadians have been more cautious with their spending ahead of the holidays, with 69% indicating that discounts are very or extremely important in their purchasing decisions;
- Holiday Shopping Motivators: The motivators for Canadians to spend with retail brands are crystal clear: free shipping or delivery (51%) and enticing special offers or sales (57%).
John Shapiro, Chief Product and Technology Officer at Lightspeed Commerce, said consumer behaviour today is influenced by several overlapping factors.
“Brick-and-mortar stores remain central to shopping habits, with 64% of Canadian shoppers reporting that they do the majority of their shopping in-store. This preference cuts across age, gender, and income levels, demonstrating that in-person shopping provides experiences and immediacy that online channels cannot fully replicate.
“That said, the role of online shopping remains a critical factor for businesses. It’s where most shoppers discover brands and make their buying decisions, even prior to going in-store.
Younger demographics, especially Gen Z and Millennials (18-34), are shifting the landscape with their reliance on social platforms such as TikTok (37%) and Instagram (32%) to discover new brands and products.
“Affordability is the leading driver of purchasing decisions, with 72% of respondents saying it’s the most important factor in buying apparel, followed by quality (65%). Sustainability and local sourcing, while often mentioned, play a secondary role in most sectors. For instance, 74% of respondents value shopping local, but the primary categories they focus on are food and beverages (71%) and gifts (32%).”
Shapiro said holiday spending this year reflects a blend of caution and tradition. Many shoppers are looking for big savings for their holiday shopping this year, with 41% of respondents noting that Black Friday/Cyber Monday was either important or very important for their holiday needs.
“While in-store shopping remains the preferred method for day-to-day purchases, the convenience of online shopping dominated during BFCM. 55% of shoppers browse and buy online during this period to avoid crowds—a major source of stress for 40% of respondents,” he said.
“Retailers can anticipate a focus on value spending, where consumers feel they are getting a good deal on their purchases. We’re still in a period of economic uncertainty, so businesses offering promotions, discounts, and loyalty incentives will likely perform better as consumers look to stretch their budgets.”
Shapiro said consumers are more price-conscious than ever. In a tight economic environment, 69% of
shoppers say that discounts play an important role in their buying decisions, while 54% cite special offers and free shipping as key factors driving their spending.
“This trend is particularly evident in apparel, where affordability (72%) and quality (65%) far outweigh considerations like local sourcing (8%),” he explained.
“Discount stores and bargain shopping have seen a resurgence, with more shoppers actively seeking promotions and deals to save money. 28% of respondents say they are explicitly searching for discounts, and 36% report being more cautious with their spending in the past six months.
“Retailers that strategically use discounts, loyalty programs, and promotions to highlight value
can capture the attention of budget-conscious consumers. This focus on affordability and savings is likely to remain a critical factor moving forward.”
Shapiro noted that economic pressures are affecting all demographics, but certain groups are feeling the strain more acutely. Younger shoppers (18-34) face unique challenges, such as managing rising debt and navigating a difficult housing market, while still valuing experiences and convenience.
“That being said, this group is also the most likely to engage in memberships like Amazon Prime
(77%) or seek VIP-style services (42% interested). Despite their financial constraints, they are
willing to pay more (55%) for out-of-stock items to get them immediately,” he said.
“The important thing for retailers to take note of is how their target demographic is spending, and
what they are prioritizing with their wallet. While the younger demographic may be willing to spend more money for the immediacy of certain items, older shoppers will wait for items to go on sale, or shop where there are better discounts.”
Shapiro said supply chain disruptions have been regularly impacting retailers for a few years, and it
continues to be a logistical challenge for many businesses.
“These disruptions have led to delayed deliveries, increased prices, and product shortages, especially during critical shopping seasons,” he explained.
“Many retailers plan well ahead of the holidays, stocking their inventory in the summer months in
preparation for the busy shopping season, but even then there were challenges in the summer
such as the eastern port strikes.
“To navigate these challenges, retailers are encouraged to diversify their supply chains and
clearly communicate inventory updates. Highlighting local products and ensuring consistent
stock can help mitigate consumer frustration and maintain loyalty in times of uncertainty.”
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