Plastic not just for toys this Holiday Season

Holiday spending intentions point to increased confidence in Canada versus the U.S.

TORONTO, Dec. 7 /CNW/ - Canadian consumers appear to be more confident this holiday season after continued improvements in the economy. This confidence is demonstrated by intentions to spend slightly more on holiday gifts when compared to 2009, and increased comfort with the use of credit cards.

According to The NPD Group, a leading market research company, Canadians plan to spend an average of $599 on holiday shopping in 2010, up slightly over 2009, and 35 per cent of consumers intend to use plastic, a seven per cent increase over the previous year, as revealed by its annual holiday survey on Canadian consumer purchasing intentions.

Furthermore, the study found Canadians may be more at ease with spending compared to their neighbours to the south, with American shoppers planning to spend an average of $526. At the same time, Americans are less willing to use credit, with only one quarter of U.S. consumers citing credit cards as their intended method of payment this holiday season.

"With a slight increase in spending and returned reliance on credit, Canadians appear to be less concerned about the economy than they have been in recent years," said Pam Wood, Senior Manager, Home, The NPD Group Canada. "At the same time, their holiday spending intentions, compared to those of Americans, reflect the relative stability in the Canadian economy versus that of the U.S."

The study indicates Canadians intend to make practical, well-researched choices in order to get the most value from their holiday budgets, with 62 per cent of respondents stating overall value for price will have the biggest influence on where they shop this season. At the same time, Canadian Holiday spending appears to be very calculated, with nearly two thirds of consumers reporting they will do some form of research before making a purchase. In fact, close to half (47 per cent) comparison shop, 39 per cent use ads or circulars and 34 per cent will compare prices online before visiting a store.

Mass merchandisers (also known as "big box" retailers) remain the destination of choice for consumers hunting for value and sales this year, with a majority (51 per cent) of respondents planning to shop at these stores. Department stores were the second destination of choice, with 43 per cent of shoppers, while 31 per cent intend to shop at electronics retailers and 29 per cent at toy stores. 

Top 10 Holiday shopping destinations:

Shopping Destination	Percentage	Percentage Change vs. 2009
Mass Merchandisers	51%	-4%
Department Stores	43%	1%
Electronic Stores	31%	-2%
Toy Stores	29%	0%
Warehouse Clubs	26%	1%
Clothing Specialty	25%	2%
Outlet Stores	19%	1%
Drug Stores	18%	-1%
E Retailers or Online Stores	17%	N/A
Beauty Specialty Stores	17%	-1%

Interestingly, many Canadians make giving the perfect gift a bigger priority than saving money. More than one third of consumers stated that they plan to buy special gifts that friends and family wouldn't buy for themselves, and close to one quarter (24 per cent) reported that they would pay more for the perfect gift - an increase of three per cent over 2009.

Canadians further demonstrated their generosity with 63 per cent intending to make charitable donations to help those less fortunate.

"This holiday season, Canadians are placing importance on generosity, as they aim to give loved ones special gifts and help improve the lives of those less fortunate with charitable contributions," said Wood.

The top 10 items on holiday shopping lists in 2010 are similar to 2009 and include the following:

Top 10 items consumers plan to buy as gifts
	2010	2009
Clothing	47%	53%
Toys	36%	38%
Books	35%	38%
Movies (DVD, Blu-Ray)	29%	35%
Music	20%	23%
Console Systems	18%	23%
Food	19%	21%
Home / Home Decorations	14%	18%
Skin Care Products	14%	17%
Fragrances	14%	16%
Source: The NPD Group, Inc/Annual Holiday Survey

"Overall, we observed that Canadian consumers are calculated in their decisions and are looking for clear value in their purchases, yet demonstrate a strong willingness to spend and invest in key special gift purchases," said Wood. "In addition, they are more comfortable relying on credit, thereby demonstrating more confidence in the economy."

Methodology:

Leveraging The NPD Group's Online Consumer Panel, the survey was fielded in English and French from November 10 to November 22, 2010 to a representative sample of 1,985 adult Canadians. Values based on the total sample (n=1,985) are accurate within ± 2.2 percent, 19 times out of 20.

About The NPD Group, Inc.

The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,700 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless. For more information, contact us, visit http://www.npd.com/, or follow us on Twitter at https://twitter.com/npdgroup.

For further information:

Daina Astwood-George
APEX Public Relations
416-924-4442 ext. 235
[email protected]