Top Five Consumer Trends for Canadian Business Owners
Canadian consumer behaviours are always changing. New trends pop up quickly, some with lasting effects and others that fade out seemingly overnight. All of them influence commercial markets, which in turn, influence businesses across the country. Here are five consumer trends with added business insight that can help you adapt to the changes and plan for scalable growth.
#1 The Canadian economy continues to recover at a steady pace.
This is good news, and while a full recovery won’t happen overnight, signs of stable progress bode well for Canada. The last quarter of 2012 had a strong finish with spending up 3.45% compared to 2011.1 Following a dip in 2009, the nation’s GDP has also been rising steadily, reaching 1.7 trillion in 2011.2
Business Insight: The economic downturn is in a state of reversal, but consumers are still feeling cautious in the current climate. Above all, it’s important right now to be observant and adaptable in order to address new consumer needs, habits and values. It may mean creating a new sales calendar, loyalty program or pooling resources with other business owners for co-sponsored offers and events.
#2 Some “lighter-times” consumer behaviours are here to stay.
It’s no secret that many Canadians adapted quickly to the economic downturn by cutting back costs on non-essentials. They also found ways to make them more affordable with practices like specialty dining at home and DIY home-improvement projects.2 And they have enjoyed it, enough that those new behaviours are likely to stick around.
Business Insight: : Habits are hard to break, and in this case, they’ve generated a slew of new, niche interests. And these can be very profitable. It’s a good time to rethink business inventory or servicing and look for ways to capture sales associated with these behaviours. Hardware stores may find themselves stocking more accent fixtures, while tourist attractions might offer package deals that cater to local patrons.
#3 Generation Y is spending more on luxury items.
From designer clothing to electronics, travel and fine dining, Generation Y is growing a taste for luxury goods. Their spending in this category is up considerably: from 2009 – 2011 fashion purchases grew by 33%, travel by 74% and fine dining by 102%.2
Business Insight: Traditionally, luxury goods have been marketed to affluent audiences. That makes business sense, as they have the disposable income necessary for routine, expensive purchases. But as Generation Y spends more on luxury goods, they are quickly becoming a key target audience. Businesses that sell luxury goods can benefit from marketing that caters to Generation Y (think smartphones, social media, and ad placement at local hotspots).
#4 Canada’s multiculturalism is creating several niche markets.
Canada is home to citizens whose heritage extends to all corners of the globe. This diversity of culture enriches all aspects of society, including commerce. Consumers have needs and desires for a variety of products, from cosmetics to foods and beverages to house wares and beyond.2 And as these needs grow, they can capture the attention of mainstream markets, too. Once-niche items can quickly become widespread favorites – sushi or curry, anyone?
Business Insight: It’s likely that there is growing cultural diversity near you, wherever you are in Canada. It may be worth reviewing your local demographic to determine if an inventory change is profitable. For service-based businesses, outreach campaigns targeted at specific cultural groups might just be the right invitation for a whole new consumer audience.
#5 Pre-purchase research is predominately digital.
Consumers are showing preferences towards online research before they make a purchase.2 Tracking down product specifications, reading customer reviews and checking on cost are common types of online research. And with the proliferation of smartphones, much of this activity is happening on mobile devices.
Business Insight: Online reputations are a huge factor for consumers deciding what to buy and who to buy it from. And while price is still the top driver of purchase decisions, what other customers have posted about a business holds a lot of sway, too. It’s worth concentrating your digital efforts in two places: 1. Make sure your website is working correctly and contains vital product information, and 2. Keep up to date on user reviews and reach out to try to make amends with dissatisfied customers. In some cases, they’ll pull their negative reviews or amend them. If you have these two things covered, mobile optimization and applications may be your next step.
1 Moneris Solutions Corporation. “Q4 2012: Canadian consumer spending continued to grow.” Canada Newswire. January 14, 2013.
2 Euromonitor International. “Consumer Lifestyles in Canada.” Passport. November 2012.