Holiday Shopping Season in Canada Expected to be Robust for Retailers as Consumers Seek Experiences [Interview/Feature]

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The past 20 months or so has already come to represent one of the most difficult periods in retail history. Full of challenges and strife, plagued by disruption and uncertainty, the pandemic environment has tested the ingenuity and resolve of retailers all over the world. And, as the full verve of the 2021 holiday shopping season continues to draw nearer, retailers across Canada are busy readying their offering and service to make the year’s final quarter a merry one. It’s a hope that’s collectively held across the industry and buoyed by a sentiment of optimism around a willing consumer who’s craving experiences and enjoyment. And, according to Tamara Szames, Director, Industry Advisor, Canada Retail at The NPD Group, it’s a hope that should translate into reality, and a very festive time for retailers across categories.

“What we’ve noticed progressing deeper into the fourth quarter is a real sense of optimism around the holiday season,” says Szames. “It’s optimism that’s highlighted most significantly by a Canadian consumer who’s started their holiday shopping earlier this year than in previous years. And there are a few main factors driving that behaviour. One is the fact that Canadian consumers are buying the things they like when they see them and looking for hot promotional items. The fear of store closures and delays related to the pandemic has also prompted consumers in the country to start shopping early. It’s also been a while since Canadians have been able to re-emerge and socialize and seek out exciting experiences with the people they love and care about. And so many are planning to enjoy time with their friends and family.”

Positive outlook across categories

CF Toronto Eaton Centre on Black Friday 2021 (Photo: Dustin Fuhs)

A combination of these factors has, indeed, hastened an earlier start to the 2021 holiday shopping season. In fact, according to The NPD Group research, 24 percent of Canadians started their gift buying in early October with an additional 25 percent anticipating beginning their shopping on the Black Friday and Cyber Monday weekend. Overall, 28 percent of Canadian consumers have committed to starting their holiday shopping earlier than they usually would. And, with respect to experiences with friends and family, research reveals that 34 percent will entertain their loved ones in their home, while 24 percent plan to dine out with those they care about. And, although Szames recognizes a pent-up appetite for experiences within the Canadian consumer, she believes that their eagerness to buy gifts is just as strong.

“All of the product categories that we track, aside from video games, have exceeded sales year-to-date over 2020,” she asserts. “So, if Q4 – the biggest holiday period – were to be flat over last year, sales for these categories would still be up 2 percent over 2019 and 8 percent over 2020. This would represent a dramatic swing. And, the positivity seems to touch just about every retailer, with clothing and toys, beauty and footwear making the strongest gains heading into the holiday shopping season.”

Satisfying experiences

Another of the top sellers this holiday season, explains Szames, are gift cards. According to The NPD Group research, a whopping 51 percent of Canadian consumers plan to purchase a gift card for a friend or family member. It’s a trend which is a direct result of disruptions and uncertainty within the current global supply chain as consumers are willing to purchase a gift card in place of a product that they can’t find as a result of product shortages and delays. Despite the products that consumers will be seeking, however, it seems clear that they’re ready to spend some of their pandemic period savings. And, according to research, they’re going to be leveraging all available channels to do so, with 30 percent of Canadian consumers prepared to spend more online this year than they did in 2020. It’s a projection that is representative of the continued shift toward digital channels, but one that Szames believes presents opportunities to retailers to satisfy the experiences consumers are looking for in both the online and physical shopping environments.

“The behaviour of the consumer is very different between online and in-store,” she says. “Online, people tend to view their purchases as more of a treat, where the physical store is serving more and more to satisfy a need. As a result, the online retail environment is playing more of a discovery role than it has previous. And, consumers are more likely to purchase something for themselves when shopping for others online. This is true for 19 percent of holiday shoppers this year with 9 percent saying that they intend to spend more on themselves. With respect to the in-store experience this holiday season, it’s important for retailers to let their customers know what product they have in stock, placing the most top-of-mind products front and centre within their stores. It’s interesting to see how the consumer will be shopping the channels differently and the opportunities that arise for retailers to cater their offering and service to them in order to satisfy the experiences they’re looking for.”

Holiday boost

The Bay at STACKT – Photo by Dustin Fuhs

All told, considering all of the consumer indications combined with lessening impacts of the COVID-19 global pandemic, this coming holiday shopping season seems as though it’s shaping up to be quite merry, indeed, for retailers across the country. It will be a welcome boost to the bottom line for most organizations that continue hustling to make up for the shortfall that’s been created over the last 20 months or so. And, it’s a boost that Szames believes has the potential to lift the entire industry.

“Given everything that we’ve been seeing and hearing, the Canadian consumer is really feeling and craving the holiday spirit, with 71 percent planning to spend the same amount that they did last year and 16 percent planning to spend more. As a result, we’re anticipating a really good holiday season for retailers who will net out the year fairly strong over 2020. There are many categories that are still trying to recover from the compressed sales of COVID key periods such as apparel and footwear. And we’re expecting those categories to really help lift sales through Q4 and the holiday shopping season.”

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Article Author

Sean Tarry
Sean Tarry
Sean Tarry is an experienced writer who leverages his unique storytelling abilities to bring retail industry news and analysis to life. With 25 years of learning, including over a decade as Editor-In-Chief of Canadian Retailer magazine, he’s equipped with a deep understanding of the unique world of retail and the issues, trends, and innovators that continue to influence its evolution and shape its landscape.

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