Festive shop windows adorn with garland and holly. Toy stores and departments buzzing with giggles and excitement. And attentive staff hustling to welcome throngs of eager shoppers. These are the sights and sounds that have, through the years, become traditionally associated with the holiday shopping season in Canada. They are sights and sounds that were significantly muted last year as a result of ongoing health concerns related to the COVID-19 global pandemic, leaving many shoppers and retailers alike feeling somewhat empty and a lot less jolly. However, Google’s recently released Holiday Insights suggests that a combination of pent-up consumer demand, a rising crest of confidence in a stabilizing economy and easing social restrictions and protocols is causing real optimism to spread throughout the industry. And, according to Eric Morris, Managing Director, Head of Retail, Google Canada, it’s optimism that he feels is well-founded ahead of what he expects to be a positive holiday shopping season.
“It’s important to point out that sentiment, whether from the consumer’s or retailer’s perspective, is highly dependent on personal and individual circumstances,” he says. “Having said that, consumer confidence is high and Canadians are spending. For retailers that operate physical storefronts, being able to remain open is providing them with a much-needed channel to service their customers and support the experiences they offer. These signals, and others, lead one to believe that the upcoming holiday shopping season is going to be a very successful one for many retailers throughout the industry. In fact, many Canadians are already in holiday shopping mode.”
Making merry, earlier
Morris’ observations are reflected within Google’s survey findings which reveal that nearly half (44%) of Canadian shoppers plan to start their holiday shopping earlier this year than they did last year. And, nearly a third (33%) have already begun their holiday shopping. He points to longstanding pandemic-induced constraints and consumer trepidation as the very functions contributing toward the expected boom in spending this holiday shopping season. Demand has been supressed for such an elongated period of time, he explains, that as attitudes toward social gatherings and in-person shopping loosens and intentions to spend on family and friends continues to intensify, so, too, does the positivity surrounding the upcoming holiday shopping season.
“Broadly speaking, there’s savings in the pockets of Canadian consumers,” he says. “They have more confidence in the economy and in the fact that we’ve finally turned the corner on COVID. Any lingering economic uncertainty effecting spending decisions continues to improve. In addition, travel has been somewhat stifled, with most of the trips remaining local and less expensive. This has resulted in a little more disposable income that Canadians are spending on other things and in different ways. For instance, shortly after the onset of the pandemic, people started investing in home improvements because they were spending more time in their homes, working, socializing and entertaining. It’s a trend that’s sustaining as people continue to spend money on things that are making their homes more comfortable. And, because society is now opening up, we’re starting to see some of the purchases that may have been suppressed or on hold, such as apparel, experience a resurgence. It’s triggering purchases and spending that’s resembling a bit of a resumption of pre-pandemic behaviour.”
Digital influence
Anything that resembles a return to consumer spending will be welcomed by merchants throughout the industry and across the country as the retail recovery continues to build momentum. One change that’s occurred during the past 18 months which will not be reverting back to the pre-pandemic status quo, however, is the shift in consumer shopping and purchasing behaviour away from physical brick-and-mortar retail locations toward online channels. And, according to Google’s Holiday Insights, that trend is set to continue with 58 percent of those surveyed stating their intentions to shop online more this holiday shopping season, two thirds (66%) intending to browse for gift ideas online rather than in-store, and 63 percent planning to leverage the websites of brands to confirm the availability of items in-store before making their purchases. Morris says that the data is all reflective of the digital evolution that’s been happening for the last long while within the industry, one that he believes has advanced nearly a decade over the course of the past year-and-a-half or so.
“Each year over the past five-plus years, ecommerce has played an increasingly significant role in holiday shopping,” he asserts. “There was a dramatic acceleration last year when ecommerce in Canada doubled. And it’s a trend that’s going to continue into this year’s holiday shopping season. In fact, we’re anticipating the largest ecommerce sales in Canada on record to date as new habits have been formed by the consumer. COVID has forced retailers across the country to up their online games to improve the digital experience, reduce shopping times and ensure that all of their assortment is online in support of the overall customer experience. What it’s resulted in is a Canadian consumer that’s now buying product online like never before.”
Values-driven decisions
In addition to the influence that impacts of the pandemic have had on consumer shopping behaviour, it’s also facilitated rethink and reassessment of the things that matter most to them and the values that they live their lives by. In fact, Google’s Insight’s reveal that 34 percent of Canadians have expressed a desire to shop with brands that share the same values as
them this holiday season. Further, nearly a quarter (22%) said their decisions concerning the products they buy and the brands they buy them from will be based largely on environmental and sustainability considerations. And, Google data shows that search interest related to second-hand stores and sustainable clothing has significantly increased over recent months. It’s all representative, says Morris, of an intensifying shift toward values-based decisions on the part of the consumer, and the underpinning of opportunities for brands to highlight the things they stand for.
“Today, Canadians are shopping their values like never before,” he says. “The global pandemic has actually served to bring a number of other things into sharper focus in the minds of Canadian consumers, resulting in greater concern around the environment and social issues like racial inequality and injustice. There’s also more emphasis being placed on community, specifically with respect to the support of local businesses. Searches for local business on Google have nearly doubled over the past year. There’s been an increase in searches for second-hand stores as well, which is less a reflection of the consumer’s desire to find deals and more about their recognition of the waste that’s being created and the need to reuse. We’ve also seen a rise in support for businesses owned by underrepresented groups. What this data tells us is that Canadians are starting to use their wallets to help make the world a better place by allowing their values to increasingly drive their decisions.”
Social inspiration
In addition to the penchant among today’s Canadian consumer to shop with their values, Google’s Insights also indicate that they’ll be willing to explore when shopping for gifts this holiday season. According to the internet giant’s data, 45 percent of Canadians say that they are open to shopping new stores and brands to satisfy their shopping needs, while nearly 4 in 10 (38%) intend to shop with small businesses. However, when it comes to consumers’ purchasing decisions this holiday shopping season, much of the inspiration that they seek will be drawn from social media, with YouTube leading the way. In fact, Google’s Insights reveal that Canadian consumers are four-times as likely to use YouTube versus other platforms to find specific information about a brand, product, or service. They are twice as likely to go in-store or online to buy something they saw on YouTube versus the competitive average. And, a whopping 60 percent of YouTube viewers said they bought a brand as a result of seeing an ad on YouTube. The data is overwhelming and testament, says Morris, to the power of the video sharing platform to drive interest among consumers and engagement with brands.
“Social media platforms are increasingly playing a really significant role in helping brands promote their products and message in an organic and compelling way,” he says. “They’re serving as incredible promotional vehicles for retailers to drive traffic to their physical brick-and-mortar stores as well as their ecommerce sites. And, the obvious choice for many consumers looking to research and learn more about the products they’re interested in is YouTube. It’s often the first destination shopped by Canadians, the starting point in their journey with a retailer or brand. Whether it’s product reviews, unboxings or anything else, consumers are increasingly visiting YouTube in order to discover new brands and products and to help them make their decision concerning the product to buy and, ultimately, the retailer or brand to buy it from.”
Evolving shopping journey
Though there are a couple looming headwinds to success as we approach the 2021 holiday shopping season, most notably in continued supply chain disruptions and constraints and ongoing staffing challenges felt by organizations across the country, the positivity throughout the industry is palpable. Propped up by a belief that the worst of the pandemic may finally be behind us, the attitudes of many around social gatherings and in-person shopping continue to soften and relax. And, with pent-up consumer savings and demand, opportunities for retail success this festive period are abound. They are opportunities that Morris suggests brands can seize if they approach their activities with a clear understanding of recent changes in consumer behaviour and the ever-evolving experiences they seek.
“The retailers that continue to focus on the ways that the consumer shopping journey has changed will be best positioned for success this coming holiday shopping season. As part of this evolution, digital continues to play an increasingly important role, whether serving as a platform for transactions or driving in-store traffic. As a result, it’s critical for retailers to make sure they offer a seamless, frictionless omnichannel experience for their customers, and that they are present and available where and when the customer wants to interact with the brand. If retailers can match their activity and focus with the places and platforms where consumers are frequenting, they’ll be able to realize opportunities to deliver the experience they’re looking for and ensure a very successful holiday shopping season.”
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