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The COVID-19 pandemic may seem like a distant memory, but it continues to impact various aspects of our lives. How we shop, eat, work, and interact with businesses have all been affected. In May 2023, the pandemic was officially declared over. Are we right in thinking that Canadians’ purchasing patterns are beginning to return to normal?
With help from SalesPRO and the Numeris’ RTS survey, we explore the evolution of consumer behaviour in Canada since COVID-19. This analysis looks at the latest RTS Fall 2023 survey, comprised of respondent data from June 2022 to July 2023.
Online vs in-store shopping
One of the most noticeable changes in Canadian shopping habits since COVID-19 has been the surge in online shopping. With lockdowns and social distancing measures in place, Canadians turned to ecommerce for their shopping needs. According to Statistics Canada, from February 2020 to July 2022, retail e-commerce sales increased by 67.9% and the sector is expected to exceed $100bn in 2023.
However, the RTS survey shows that Canadians still prefer to shop in-store. In the Fall 2023 survey, 54% of Canadians aged 12 or higher agree that they prefer to shop in-store for the customer experience, whereas 38% of them prefer the convenience of shopping online. This compares with 57% preferring in-store and 29% preferring online shopping pre-pandemic in the Fall 2019 survey.
The style of shopping preference differs even more in Quebec where 56% prefer to shop in-store as opposed to 35% online. The major difference in preference is with younger Canadians. We see that amongst the 18-34 age group, 52% prefer to shop online with 37% preferring in-store.
Also, when we look at the major retail categories measured by the RTS survey only dollar stores, online classified websites, and cosmetics/skincare stores have seen a year-on-year increase for online shopping. On the other hand, almost all categories have seen an increase in in-store shopping with shopping mall stores up 9% and cosmetics/skincare stores up 18%.
Shifts in spending by category
The RTS data this year shows that some of the spending patterns that emerged during the pandemic are beginning to change. We can identify four different patterns based on average spending by year:- Declining: Categories that were impacted by the pandemic and have yet to recover to pre-pandemic levels (e.g., Women’s clothing is still down 8%, cross-border US shopping down 19%, restaurant spending for business reasons down 10%)
- Recovered: Categories that grew during the pandemic but have fallen back to where they were (e.g., home decor and furniture)
- Emerging: Categories that grew in the pandemic and are now higher than where they were in Fall 2019 (e.g., books, toys, garden supplies)
- Growing: Categories that suffered during the pandemic but are now higher than where they were originally (e.g., sporting goods and restaurants for personal/pleasure reasons).
Average annual category spend ($, all Canadians aged 12+)
It is hardly surprising that restaurant spending has increased when 59% of Canadians say they ate in a restaurant in the past month compared to 48% last year (and only 21% in Fall 2021).
The increase in restaurant dining seems to have impacted other forms of food ordering. Home delivery is down 7% compared to last year and online delivery services such as Skip the Dishes and Uber Eats are down 12% with 14% of Canadians claiming to have used such a service in the past month.
Impact of inflation on consumer behaviour.
The pandemic caused a shift in spending priorities for Canadians and the rise in the cost of living is further influencing consumers’ buying decisions. With financial uncertainties and the fear of a potential recession, many Canadians have become more mindful of their spending habits.
We can see that Canadian shoppers have become more price-conscious, opting for budget-friendly options. 60% of Canadians aged 12+ have shopped in a dollar store in the past month, an increase of 7% year on year, and 32% have shopped through an online classified website.
Only 21% of Canadians say that if they see something interesting in store then they will buy it on impulse (down 5% from last year) and 38% of Canadians say they will pass on their favourite brand if something else is on sale (up 15% from last year).
The RTS data also shows that average monthly grocery spending has increased 3% year-on-year. However, lower-income households are being disproportionately affected by price increases.
Household average weekly grocery spend
Environmental/social issues in relation to consumer behaviour
The pandemic seemed to heighten awareness about environmental and social issues but since then they have started to decline in importance. During the pandemic, data showed that Canadian consumers found it more important to buy products from socially responsible/ environmentally friendly companies.
They were also more willing to pay higher prices for eco-friendly products and support Canadian retailers when shopping online. These factors all continue to drop in importance according to the latest Fall 2023 survey.
% of Canadians aged 12+ who agree with the following statements
The COVID-19 pandemic has brought about significant changes in consumer behaviour in Canada. The growth in ecommerce seems to be plateauing as Canadians return to shopping in-store. However, economic uncertainty is having an impact on purchasing decisions.
SalesPRO is used here to analyze the Numeris RTS survey. If you would like more information on this software please get in touch with your Account Executive.
This post was originally published in October 2021 and has been completely revamped and updated for accuracy.