Despite declining confidence, Canadian consumers still spending
Despite heavy concerns about their personal finances, Canadian shoppers are still spending, according to a late-2022 PwC survey of 500 Canadians.
Persistent high inflation and a probable recession are weighing on the minds of shoppers. Nearly half (47%) of Canadians are very or extremely concerned about their personal finances – with 70% cutting back on non-essential purchases in response.
Despite those alarming figures, year-over-year retail sales are actually up in recent months, according to StatsCan, and shoppers continue to spend (for now), though with higher price sensitivity and desire for enhanced experiences in-store and online.
Seventy-three percent of consumers say they visit physical stores at least once per month, while 42% shop on their smartphones at least monthly.
In terms of physical stores, nearly half (48%) of Canadians say self-service checkouts are an attractive feature. PwC notes self-service tech can help free up staff to focus on higher-value activities – such as assisting customers in-store. Fifty-two percent of consumers say knowledgeable and helpful sales associates are an appealing part of an in-store experience. The tradeoff of self-checkout, however, is its effect on loss prevention strategies as well as cost of implementation and maintenance.
Though consumers are scaling back non-essential purchases, one-in-five say they will increase spending in the next six months with retailers offering an efficient delivery service. Though shipping rates have skyrocketed in the last three years, global supply chains have improved significantly since their shambolic state in 2021. GEP’s supply chain volatility index in February reached its lowest point since August 2020, reporting normalizing transport costs and lower pressure across all transport forms.
PwC says companies that improve their delivery efficiencies through data, analytics, and automation will have an opportunity to grow market share.
“With consumers’ evolving expectations and a desire for an enhanced omni-channel experience, Canadian retailers have an opportunity to build new avenues for meeting consumers needs and differentiating their brand by creating frictionless and memorable experiences,” said Myles Gooding, national consumer markets leader and global consumer markets advisory leader, PwC Canada. “It is imperative for retailers to transform and capture a share of in-person and digital experiences. In order to be successful, retailers must reimagine how consumers use technology across multiple channels and effectively interact with their brand.”
