Canadians approach holiday season with optimism; Gen X and Gen Z will lead the increase in spending

• 76% of respondents expect to spend the same or more this year, than 2022
• Gen X and Gen Z will lead the spending surge, with an increase of 29% and 26%, respectively
• One in four (25%) Gen Z and Millennial consumers will use emerging retail technology such as Virtual Reality / Augmented Reality / AI for holiday shopping

TORONTO, Nov. 6, 2023 /CNW/ - Despite economic uncertainties, Canadian consumers are gearing up for the 2023 holiday season with some resilience and determination, according to a recent survey conducted by PwC Canada. This year's edition of PwC's Canadian holiday outlook revealed that 76% of respondents plan to maintain or increase their holiday spending compared to the previous year.

When it comes to generational spending trends, the average expected spending per Canadian consumer is expected to grow 13% over the previous year. Gen X and Gen Z are leading the spending, with increases of 29% and 26%, while Millennials and Baby Boomers anticipate a more modest increase (3%).

"Canadians are approaching the holiday season with optimism. The survey reveals shifting generational spending patterns. These changes reflect the resilience and adaptability of Canadian consumers in navigating evolving economic landscapes," says Myles Gooding, National Consumer Markets Leader & Global Consumer Markets Advisory Leader at PwC Canada. 

Canadians are traveling and on the move again: The average Canadian spend on travel this year will be the highest we've seen since 2019. The increase is seen primarily due to planned travel expenditures, which are up 31% in Canada and 12% in the US from 2022. Consumers are resuming their pre-pandemic travel patterns and spending the holidays with friends and family, as well as fulfilling their pent-up demand for trips abroad.

Post pandemic shopping trends: With Covid and safety concerns not top of mind, in-store shopping will make a come-back, with 63% of consumers planning in-store purchases, especially for gift ideas. Online marketplaces, notably Amazon, will continue to dominate e-commerce, with 91% of respondents planning to shop on the platform.

Emerging retail technology for an enhanced shopping experience: According to the PwC 26th Global CEO Survey, almost 40% of top executives believe their organizations may not exist in 10 years. Reinventing the business will be critical to remaining viable in the long term, particularly with an increase in demand for tailormade shopping experiences. Shoppers of all ages are looking for knowledgeable in-store staff to make enhanced product recommendations by using new retail technology and digital tools. 25% of Gen Z and Millennial consumers indicated that they would use emerging technologies, including virtual and augmented reality, the metaverse and artificial intelligence (AI), in their holiday shopping. These technologies hold powerful opportunities for retailers, such as assisting online shoppers with selecting accurate apparel sizes which helps reduce the number of items they return.

Choosing brands with purpose: Consumers are choosing brands that help create value for their community. Nearly nine in ten (89%) said their desire to support local businesses factors into their holiday purchasing decisions. And 83% said they want retailers to prioritize making a positive economic and social impact in the communities in which they and their suppliers operate.

Navigating the evolving landscape of consumer behaviour,  the Canadian consumer industry stands at a pivotal juncture. With resilient optimism driving holiday spending, retailers are urged to prioritize cost-conscious strategies and embrace innovative in-store experiences to meet the shifting demands of post pandemic consumers.

To read more about retail trends and the Canadian holiday outlook, access the detailed report here.

About the survey:

PwC Canada prepared the 2023 holiday spending forecast to equip retailers with insights into consumer sentiments as they navigate the uneven economic recovery and meet the needs of a new consumer persona. The survey was conducted from July 24 to August 16, 2023, gathering insights from 1,000 Canadian consumers. The sample is representative of the Canadian population in terms of age, gender, province, and income.

About PwC Canada:

At PwC, our purpose is to build trust in society and solve important problems. More than 9,000 partners and staff in offices across the country are committed to delivering quality in assurance, tax, consulting and deals services. PwC refers to the Canadian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. Find out more by visiting us at: http://www.pwc.com/ca

© 2023 PricewaterhouseCoopers LLP, an Ontario limited liability partnership. All rights reserved.

SOURCE PwC Management Services LP

Anuja Kale-Agarwal, National Communications Director, PwC Canada, [email protected]