Eighty per cent of Consumers across Canada are preparing for long-term financial issues, while 63 per cent are concerned about low economic confidence, according to the latest EY Future Consumer Index Survey. Over half of households expect their living costs to continue trekking upwards, as concerns over personal finances affect all income levels, from low income (87 per cent) and middle class (77 per cent) to high income (64 per cent).
“Stunted by inflation, consumers are turning back to pandemic-induced behaviours – prioritizing savings overspend,” says Monica Chadha, EY Canada retail leader. “This trend towards limiting non-essential spending and looking for more sustainable alternatives presents a challenge to fast fashion retailers.”
Alternative experiences and products are sparking new interest
A small but a growing number of Canadians are interested in exploring emerging digital and technology experiences. Nearly one in 10 respondents have used digital currencies, experienced the metaverse or purchased a virtual product, largely driven by younger and more affluent consumers.
“Newer forms of digital goods and services present opportunities for companies to invest in developing channels to differentiate their brand experience, innovate and capture more consumer data,” explains Elliot Morris, EY Canada grocery and consumer packaged goods leader. “But it’s important to keep in mind that as the digital world expands, consumers will become increasingly cautious when sharing their personal information.”
“Businesses should embed both sustainable innovation and data protection into the foundations of their strategies to show consumers that they use their information in responsible ways that deliver tangible benefits,” adds Morris.
Learn more about the EY Future Consumer Index.