Posthaste: Restrictions lifted — where are Canadians spending their money now?


Good morning!

The pandemic has changed our consumption habits.

We Googled and searched our way to online bargains, stuffed our cellphones with shopping apps, and discarded many products altogether, in favor of new habits, services, and indulgences.

But with the easing of restrictions in most provinces over the past few months, Canadians are once again spreading their wings, hitting hockey arenas, going to malls and even watching a movie in a closed environment that required us to share space with other vaccinated strangers.

For example, a new report from the Royal Bank of Canada reveals that Canadians are in crazy mode.

Overall spending remained elevated, standing 20% ​​above 2019 levels as virus concerns eased, RBC said.

“Canadians continued to visit restaurants and eateries even as patio season began to wind down,” economists Nathan Janzen and Rannella Bily-Ochieng said in a report.

The report, which anonymously tracks card spending by its account holders, shows Canadians are spending more on entertainment, even as money allocated to hotels and accommodations has slowed, likely at the end of the season. summer.

“Some online shopping habits have taken root, including for grocery shopping, despite the removal of many restrictions on bricks-and-mortar retail,” the RBC economist noted.

Canadians’ intention to keep their wallets open over the holidays is also the theme of a survey conducted by the Angus Reid Institute on behalf of Ownr, a venture capital firm of RBC.

But the rise in spending is partly due to rising prices and supply chain bottlenecks, according to a survey released this morning. Canada’s inflation rate was 4.4% in September, its highest level since 2003.

“Among the top concerns consumers face when they start planning their holiday shopping, rising item prices were ranked first by 41% of Canadians, followed by being on a tighter budget than previous years (18%) and to find articles. out of stock (14 percent),” according to the survey.

About 52% of Canadians planned to spend more on holiday shopping compared to the previous year, as they expect higher retail prices.

“Rising transportation costs due to global supply chain bottlenecks are being passed on to buyers, and our survey shows Canadians don’t expect their dollar to stretch that far this holiday season,” said Derek Hopfner, chief revenue officer at Ownr.

Canadians also indicated a desire to return to physical stores, with 79% feeling comfortable shopping in-store this season.

One reason to return to in-store shopping is due to a desire to support local small businesses that have been hit hard by the pandemic.

Most Canadians found their favorite local small business the traditional way, including window shopping (59%) and word of mouth (55%), notes the Ownr report.

“The top three reasons why some Canadians choose to do all or most of their shopping from small businesses are because they: 1) want to support the local economy and jobs, 2) know that small businesses need income, 3) have a preference for buying products made in Canada,” the survey says.

A separate Shopify Inc. Black Friday/Cyber ​​Monday survey released last week also suggests spending isn’t expected to slow. This year, respondents said they plan to spend an average of $542 over the long weekend, an increase of $61 from the $481 reported in 2020.

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