Canadians plan to spend less on holidays, focus on value over price

Canadians plan to spend an average of $911 during the upcoming holiday season, according to a new survey. This represents a decrease of 6.5% from the $975 they budgeted last year. The Retail Council of Canada and Leger's annual Holiday Shopping Survey found that 52% of consumers expect to spend about the same as last year. Twenty-two per cent plan to spend less, while another 22% plan to spend more. The vast majority of spending, 86%, is allocated for gifts for others.

"Canadians are adjusting their expectations and they’re making choices about what they can afford, rather than simply giving up on holiday shopping," said Luc Dumont, senior vice-president of consumer insights at Leger. He said this distinction is important as budgets tighten. For retailers, the challenge extends beyond simply driving sales. "It’s convincing them that your products, your offers and your experience deserve a place in that budget," Dumont added.

The survey reveals that finding the lowest price is not the top priority for most shoppers. More than half of respondents, 53%, said giving a memorable or meaningful gift matters most. Only 23% said finding the lowest price was their priority. "Even in a year when budgets are under pressure, the cheapest option is not necessarily the most appealing," Dumont said. Consumers still want gifts to feel thoughtful and appropriate for the recipient.

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When evaluating purchases, 39% of Canadians say they look for the best overall value, a significantly larger group than the 16% who prioritize the lowest price. Dumont explained that consumers are assessing the broader offer, which includes factors like product availability, promotional pricing and convenient shipping. "All these considerations can contribute to how consumers will perceive the value, and for retailers, that’s a very important opportunity," he said. Competing on value means making the complete experience compelling, not just being the cheapest.

Spending patterns are shifting slightly between categories. Clothing and accessories will account for 19% of holiday budgets, up from 17% last year. Meanwhile, food and alcohol for entertaining is expected to drop to 14% of the budget from 16%. "These are not dramatic shifts, but they do show that consumers are making adjustments to every part of their holiday budget," said Dumont. He noted these adjustments vary by category.

Deals remain influential, with 64% of shoppers saying they will look for more deals than in previous years. Forty-three per cent will wait for major sales events like Black Friday and Cyber Monday to make purchases, up from 39% last year. While 84% of Canadians say a Made in Canada label would make them more likely to buy a gift, 52% add that this is only if the price is reasonable. "The majority of that potential support is conditional on affordability," Dumont said, noting that retailers must offer both Canadian origin and good value.

With files from Canadian Grocer