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The 12 Truths of 2021 Holiday Shopping

This holiday season truth and trust is at the top of Canadians’ shopping lists. They will be heading back to stores, spending more, shopping earlier, and focusing on gifting memories instead of material items.

We’ve rounded up the 12 key truths of the season to take into 2022 to keep your brand at the top of their list.

1. Three holiday shopping mindsets exist

Many are embracing a “hybrid holiday this season, blending the return of a celebratory feeling with the now normalized pandemic lifestyle,” according to Marketing Tech.

The planner: Organized and methodical, they plan weeks in advance, pre-order food, and complete shopping well ahead of the holiday.

The want-to-be planner: Aspires to be like the planner, but often implements plans a little too late, leading to some disorganization and forced compromise on budget, stock availability, etc.

The last-minute gifter: While their heart is in the right place, things are often left to the last minute, and they are comfortable with compromise and ambiguity.

2. Truth-led shopping rules the season

Consumers care about brands that live their values truthfully, now more than ever before, and are placing greater focus on being able to shop responsibly. A 2021 Canadian Holiday study by PWC found that three-quarters of respondents say they are likely or extremely likely to shop with brands or retailers that they consider trustworthy this holiday season.

3. Conscious Consumption and Circular Gifting is a focus

Consumers want to gift responsibly. Accenture’s 15th Annual Holiday Shopping Survey found that one in three consumers “will be ditching wrapping paper for environmental reasons this holiday season, 23% will be buying materials and ingredients to gift homemade gifts this year, and more than a third (37%) of consumers say that buying second-hand apparel is something they are likely to do”. This was most present in shoppers under the age of 40.

4. Shopping small & local is still a priority

62% of respondents from the PWC Holiday study anticipate they’ll shop at retailers offering Canadian- made products, and 64% of those surveyed by Think Google say they will shop at more local small businesses.

5. In-store shopping returns, and is most popular with Gen Z

59% of Canadians expect to holiday shop in-store this year. They are returning to in-person retail in search of discovery, and as reported by CNBC “being able to touch and feel products, getting what they want immediately, and browsing for gift ideas were top reasons to make the trip”.

In the US, Accenture found that more than half (54%) of people overall — and 70% of Gen Z consumers — plan to do most of their holiday shopping in-store this season, whereas 54% of baby boomers expect to shop online. With more traffic expected in-store, e-commerce sales will decline, but should top the $200 billion mark for the first time. Consumers are still valuing convenience, and are expected to continue utilizing curbside pick-up habits adopted during the pandemic.

6. Shopping begins early

According to the Think with Google study, 20% of Canadians had already started their holiday shopping in June, and 44% planning to shop for the holidays said they would start earlier than last year. Some were prompted by aggressive or prolonged retailer discounting, and more recently, by the widely reported supply chain delays across multiple categories.

7 & 8. They plan to spend more overall, and more on themselves – especially men

According to PWC, Canadians anticipate increasing holiday spending by 29% over last year, with an average spend of $1,420 (that’s 11% below 2019, mostly due to limited travel spending). The study also found that respondents planned to spend 76% more on themselves (approx. $478), with this behaviour more popular among males.

9. They’re less loyal

Consumers are now more willing to switch brands or retailers, especially if items are out of stock.

Supply chain shortages and increased prices will also drive comparison shopping.

10. Holiday shopping inspiration has expanded to new platforms

Holiday shoppers are looking to social media for gift giving inspiration. 58% say social media will have an influence, and of those consumers, the platforms influencing behavior the most are Facebook (67%), YouTube (57%), and Instagram (52%). When looking at Gen Z specifically, their preferences differ. 87% of Gen Z say they expect to be inspired by social media, with YouTube, Instagram, and TikTok indicated as their sources of inspiration.

11. Gifting will shift from material items to memory-making experiences

43% of consumers plan to gift experiences and services according to Accenture. This is even higher with younger generations, with 53% of millennials and 50% of Gen Zs planning experiential gifting. Travel-related gifts are a priority with 40% of older millennials (age 32 and 39) planning to gift travel vouchers or flight tickets, according to the survey.

12. Buy Now, Pay Later is booming

For those that are buying physical items, Buy Now, Pay Later options like Affirm and Klarna are becoming more popular. This year use of BNPL programs are up 10% compared with 2020, and up 45% compared with 2019, according to data from Adobe Analytics. One in four respondents from the Adobe study said they have used BNPL plans in the last three months, with apparel, electronics and groceries as the top-purchased categories.

What does this mean for your brand this holiday season and beyond?

Here are 7 Key Ways to Win in 2022:

  • Put the needs of the consumer first. Provide convenient solutions that will appeal to all shopper mindsets during the holidays and rest of year (e.g., interactive list-making, reminders, easy pick-up options, stock availability throughout the entire season);
  • Align your purpose with your audience’s and live authentically to win and keep their trust. Perfection is not possible – so be honest – share your ESG metrics and do your best to walk the talk and live your brand promise. Allowing consumers to participate in your initiatives builds even stronger trust;
  • Align the above with your brand communications. Ensure all touchpoints are true to your brand strategy and consistent with one another, so you’ll stay at top of mind with your consumers, and hence, provide a coherent and exciting brand experience;
  • If you’re not a local brand, support local in other ways (e.g., local product ingredients) or incorporate local support into your business model;
  • Make shopping easy in all environments – online and in-store. Make it seamless and give them convenient ways to shop and pay (e.g., curbside, expedited delivery, live streaming, social shopping, etc.);
  • Consider how you can evolve your portfolio to include personal/giftable experiences to meet the new demand for them (e.g., through co-branded partnerships, etc.);
  • Optimize social content across platforms to inspire, drive traffic (on/offline) and conversion;
  • Allow flexible payment options to ease the financial stress some have, and may continue to incur this year and beyond.

 

Sources:

2021 Canadian holiday outlook, PWC, 2021

https://www.pwc.com/ca/en/industries/consumer-markets/2021-holiday-outlook-canadian- insights.html?WT.mc_id=CT3-PL57-DM1-TR4-LS40-ND30-TTA1-CN_CA22CM– STP2STD&gclid=Cj0KCQiA15yNBhDTARIsAGnwe0X-KHt- tG9iUp8sMr4WVpqgbY0GV0KU_I0xHGgI1APp15_nwvMu2kgaAqQvEALw_wcB&gclsrc=aw.ds

Made in Canada, PWC, 2019

https://www.pwc.com/ca/en/industries/consumer-markets/made-in-canada-2019.html

3 early shopping trends for the 2021 holiday season, Think with Google, November 2021

https://www.thinkwithgoogle.com/intl/en-ca/consumer-insights/consumer-trends/festive-season-retail- holiday-shopping/?utm_medium=email&utm_source=d-newsletter&utm_team=twg- ca&utm_campaign=TwG-CA-NL-2021-11-25-Think-at-a-Glance-Holiday-Knak&utm_content=article-1- cta&mkt_tok=MTcyLUdPUC04MTEAAAGA9bqUtCI211ZjJnLDRZA_ytxHnZs6HAHGJ1IzlaEwK4cWPTaE rrBDn1CyDOnhBO85yyqR9ca3uLx6CTJtV_DdO7LLJ3cjtjVxu9CdDN9XscLL

Meet Generation Z: Shaping the future of shopping, McKinsey, August 4, 2020

https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/meet-generation-z- shaping-the-future-of-shopping

Adobe: Consumers spent $10.7 billion on Cyber Monday, $109.8 billion so far this holiday season, Adobe, November 2021

https://blog.adobe.com/en/publish/2021/11/30/adobe-consumers-spent-10-8-billion-on-cyber- monday-109-8-billion-so-far-this-holiday-season#gs.i32wvr

U.S. Shoppers to Show “Generosity of Spirit” This Holiday Season, Accenture Survey Finds, October 2021

https://newsroom.accenture.com/news/us-shoppers-to-show-generosity-of-spirit-this-holiday-season- accenture-survey-finds.htm

Four ways holiday shopping has changed since the pandemic began, CNBC, November 2021

https://www.cnbc.com/2021/11/21/holiday-shopping-2021-4-ways-shoppers-have-changed-since-the- pandemic-began.html

Christmas shopping season set to follow trends laid by the pandemic, Marketing Tech, October 2021

https://marketingtechnews.net/news/2021/oct/27/christmas-shopping-season-set-to-follow-trends- laid-by-the-pandemic/

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