TORONTO, June 14, 2017 /CNW/ -- With 2017 marking Canada's 150th anniversary, it seems that national pride is alive and well as new research from Mintel's annual Canadian Lifestyles report reveals that three quarters (73 percent) of Canadians say they are proud to be living in Canada. Hand-in-hand with their patriotism is consumers' belief that they are a more tolerant people than those in many other countries, with more than half (55 percent) of Canadians believing this to be true.
It would appear that pride for queen and country runs deep. Despite the fact that increasing diversity is leading to a growing global marketplace, nearly half (45 percent) of Canadians say they try to buy 'made in Canada' products whenever possible. With only 15 percent saying their values are different than most, the level of camaraderie and shared beliefs is high.
When it comes to spending this year, consumers continue to hold a conservative mindset, with most Canadians likely to report that they allocate their extra dollars toward paying off debt (33 percent), similar to the 32 percent who said the same in 2016. However, Canadians are more likely to consider their financial situation to be 'healthy'* this year (40 percent) than they did in 2016 (36 percent).
A little extra cash on hand is leaving room for small splurges, with certain categories feeling lots of love. While the majority of consumers report spending their extra dollars about the same this year as compared to last year across most consumer categories, Canadians report spending more on dining out (30 percent vs 27 percent in 2016) and investments (22 percent vs 19 percent in 2016) in 2017, each growing three percent over the prior year.
"In the current economic and political climate, what defines Canada extends beyond a 'made in Canada' label. Instead, it encompasses the values held by Canadians, such as being inclusive, highlighting opportunities for companies and brands to connect with audiences by showcasing how these values are core to their philosophy," said Carol Wong-Li, Senior Lifestyles and Leisure Analyst at Mintel. "A slight improvement in perceived financial health means that consumers have a little more wiggle room this year when it comes to discretionary spending, indicating that continued proof of value, be it in the form of quality or simultaneously meeting multiple needs, will continue to play a role in consumer spending decisions."
Overall, Canadian consumer expenditure in 2016 increased 3.5 percent over the previous year. Mintel forecasts that total consumer expenditure will grow at an average annual rate of 2.8 percent by 2021.
Mintel predicts that the categories expected to see the strongest growth over the next five years include transport and food-related industries, such as foodservice and groceries, with foodservice leading the charge. The prioritization of debt reduction is leading to slow growth in non-essential categories, including leisure and entertainment, and lower-engagement categories, such as household care.
Mintel's Canadian Lifestyles 2017 report tracks spending across 16 major consumer markets, revealing the categories that present areas of opportunity and disruption in the year ahead. Highlights from the 2017 report include:
QSRs attract the cost-conscious
Whether it's due to rising food costs or extra room to treat themselves, nearly one quarter (23 percent) of Canadians agree they are spending more on dining out this year compared to just 20 percent in 2016, with over two in five (42 percent) saying they dine out weekly. However, Canadians are proving that treating themselves can be done conservatively as quick-service restaurants (QSRs) are the most commonly chosen foodservice type among consumers (66 percent), compared to 43 percent who dine at full-service family restaurants and just over one quarter (27 percent) of consumers who visited a fine dining restaurant.
Chinese Canadians drive sales of new cars
Mintel research reveals that Chinese Canadians are much more likely to plan on purchasing a car as over three quarters (78 percent) of this group plan to buy a vehicle within the next three years**, compared to just 65 percent of Canadians overall. This also proves to be encouraging for luxury automotive brands as Chinese Canadians (76 percent) lean more toward the luxury segment compared to Canadians overall (65 percent).
Non-dairy alternatives soak up healthy standing
Half (50 percent) of Canadians claim that they or someone in their household drank non-dairy milk in 2016, with just over one third (37 percent) claiming to personally consume it. Non-dairy milk seems to be benefitting from its healthy reputation as consumers are more likely to use non-dairy milk (33 percent) as an ingredient in homemade smoothies or shakes than dairy milk (28 percent), and one in eight (12 percent) agree that non-dairy milk products are healthier to drink overall. What's more, plant-based drinks accounted for 58 percent of milk drink*** launches in Canada in 2016, up from just 32 percent in 2014, according to Mintel Global New Product Database (GNPD).
Canada's youngest generations cut the cord
Nearly three quarters (71 percent) of consumers are interested in cutting their pay-TV service completely, with 28 percent very interested in doing so. Younger consumers aged 18-44 are more likely to agree with this sentiment (32 percent) as they are more likely to have adopted video streaming services (65 percent) than those aged 44+ (40 percent). In addition to meeting their on-demand needs, cost is likely a factor for cash-strapped younger consumers.
Male Baby Boomers toast to growth in the wine industry
Canada's population is aging and, today, over-65s make up the fastest-growing age group, a trend that has supported wine growth in recent years, especially among men. Men over 55 are the most likely to be heavy consumers of wine**** (31 percent). This is likely a reflection of maturing tastes and the perception of wine being good for one's health, which men over 55 are more likely to agree with (67 percent) than consumers overall (55 percent). Mintel research also reveals that as the population ages, so does interest in wine. While just 16 percent of Canadians aged 20-24 say they drink wine once or more per week, this number increases to one quarter (24 percent) of those aged 25-34, indicating a bright spot for the category in the coming years.
P2P piques interest and disrupts lending
A small section of Canadians are paying extremely high rates on their debt, with one in six (17 percent) saying they have used an alternative financial services provider. However, the emergence of peer-to-peer (P2P) lenders promises to give borrowers another avenue to obtain loans. Mintel research shows that while there is a general lack of awareness among consumers about marketplace lenders, the industry in Canada has growth potential as more than one quarter (28 percent) of car owners aged 18-34 report that they would consider using peer-to-peer lenders for their next car purchase.
*Mintel defines 'healthy' as having money left at the end of the month for some luxuries or to add to savings
**Leading to 2019
***Includes plant-based drinks (dairy alternatives), white milk and flavoured milk
****Heavy wine consumers are defined as drinking wine once or more per week
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