The COVID-19 pandemic accelerated online shopping trends in Canada and a new survey by PayPal Canada indicates just how much consumers shifted their spending patterns.
The survey, titled Trends & Spends: PayPal Canada’s 2021 Consumer Shopping Study, found that Canadians overall increased their monthly online shopping spend by more than $2 billion compared to pre-pandemic.
Survey respondents said they are spending $178 per month shopping online, an increase of $69 compared to pre-pandemic. Across the country, this translates to almost $5.5B in current monthly online spending, said PayPal.
The survey found that 59 per cent of Canadians have boosted their online shopping habits compared to before the pandemic and the grocery sector in particular has seen a significant increase.
“An initial survey of Canadian consumers in March 2020 found that only 19 per cent engaged in online grocery shopping. In a second survey conducted in April 2020, only 30 per cent of Canadians purchased groceries online. Today, our most recent survey shows that number has jumped to 49 per cent,” said PayPal.
Jill Cress, PayPal Vice-President, Consumer Marketing, said only 44 per cent of consumers last year said they anticipated shopping online more than they were already. That has now jumped to 59 per cent.
“Looking back at how overwhelmed we were at the challenges of finding toilet paper and hand sanitizers in store last year it’s great to see that just one year later, we are turning to e-commerce for all of our needs and the data shows this shift is here to stay,” said Cress.
“I think what happened during COVID was accelerating the relationship that consumers had with online commerce and the relationship with convenience, and being able to secure the goods in particular that they needed became so prevalent during COVID and now what’s playing out is the reality of just how convenient it is to shop online. If we look at that from a vertical standpoint, something like grocery shopping. We see that consumers still expect to shop online.
“While they may want to go into a grocery store to experience the produce department they don’t want to go into a grocery store and have to lug home heavy things like water or laundry detergent. So there’s the convenience that online delivery will continue to play as consumers emerge out of COVID.”
Some key findings from the PayPal survey:
- Canadian women surveyed are more likely than men to have increased how often they’re shopping online groceries (36 per cent versus men at 26 per cent);
- Ontarians are the ones who are more likely than others to have increased how often they’re shopping for groceries online (36 per cent compared to 24-30 per cent in other provinces.);
- Home office furnishings and equipment (56 per cent), up from 42 per cent in April 2020;
- Fitness equipment, apps, or programs (41 per cent), up from 25 per cent in April 2020;
- School supplies (38 per cent), up from 23 per cent in April 2020;
- Three in five Canadians (61 per cent) surveyed say they believe that cashless transactions will be part of their typical shopping experience and one in four (28 per cent) say they don’t expect to use cash five years from now at all;
- Canadian consumers expect retailers to be innovative in their approach to keeping up with digital demand including offering drone deliveries (29 per cent), facial recognition for payment (25 per cent), virtual reality fitting rooms (17 per cent) and holographic representation of products (11 per cent);
- For half of Canadians, the main deterrents to online shopping are the shipping cost (53 per cent) and the delivery time (51 per cent), as well as a preference to pick out their own products in person (50 per cent); and
- One in five Canadians (19 per cent) say they are held back from online shopping because they are worried about safely transacting online.
Cress said Canadians spent more time at home and the desire to make their homes more comfortable for both the way they work and live was a key driver of the massive growth in home office furnishings and equipment.
“We were at home and we were looking for new hobbies, new ways to keep ourselves healthy, new ways to keep ourselves motivated. I think it was both the need for functional comfort as well as for ways to keep ourselves motivated and embracing some of those new hobbies and new ways of using that time at home in ways that felt rewarding to us as consumers,” she said.
Cress said consumers are going to raise the level of expectations around the retailers that they engage with to be innovative and to provide them with new offerings and new solutions that meet that consumer demand for convenience and for safety.
“We see that more Canadian consumers expect to use less cash in the future . . . What does that mean in the way that retailers show up with digital payment solutions? How do we provide those solutions in a way that are seamless for the consumer? Things like facial recognition coming into play to facilitate commerce. What does it mean to be able to see products in virtual ways and holographic ways? Meeting that consumer demand for convenience across different touch points is an opportunity that retailers will have to continue to build a stronger relationship with that consumer,” she added.