Rising costs will make holiday shopping start earlier

Dentsu also predicts this will make shoppers prioritize food and gift purchases over travel and experiences.


Inflation and supply chains will compel a large percentage of shoppers to start their holiday deal hunting earlier.

According to the latest Dentsu Navigator Holiday Shopping report, 42% of shoppers plan to start buying gifts earlier to get better deals. Most respondents expect to concentrate their spending for the holiday season in October and November.

In 2021, between shopping, presents, travel and food/ beverages, many Canadians spent more than a month’s rent on the holiday season. This year, according to Charlie Almond, chief strategy officer of Dentsu Canada, concerns over the rising price of goods are leading consumers into a mindset where holiday shopping will inevitably come hand in hand with the need to make tough decisions. This means making trade-offs, prioritizing gifts and food over holiday travel, decorations and out of the home experience-based celebrations.

For holiday spending, value holds a great amount of leverage among lower and middle-income households, while higher income households consider additional factors like quality, eco-consciousness and exclusivity.

Nearly half of all Canadians under 40, however, and a third of Canadians of all ages, are living paycheck to paycheck. Many retailers are seeing basket sizes go down, while trip frequency going the opposite direction. Food costs, Dentsu says, will pose the biggest challenge to holiday celebrations as grocery is one of the categories most vulnerable to brand switching.

In-store shopping is the preferred mode for food and alcohol purchases, as well as for categories like jewelry, personal care and gift cards. However, in most gift categories, online shopping has become the default, and Dentsu says brands need to be optimizing their presence with online retailers, even if they don’t end up buying there: more than half of consumers will look at sites like Amazon for inspiration, where they may also consider purchasing generic brands.

Nearly four in five consumers report that participation in a loyalty program does not mean they have fealty to a particular brand. So, as inflation continues to dog shoppers, brands will need to reflect more on how to communicate value beyond simply a dollar figure, and to include things like functional benefits.

Gen Z and Millennials are more likely to treat themselves. Brands, Dentsu notes, should consider emphasizing the practicality and long-term benefits of their offerings in campaigns targeting older demos, while reserving messaging tied to indulgence to campaigns that are targeting younger generations.

Visual social media will continue to inspire younger consumers’ gift-giving purchases with Gen Z and Millennials over-index on trusting platforms like TikTok for inspiration. Parents with younger kids will also pay attention to products showcased in these environments.