Holiday spending projected to drop 14%, says Deloitte

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Photo by Mert Alper Dervis/Anadolu via Getty ImagesSpending on gifts and gift cards is expected to drop five per cent this year as Canadians get increasingly intentional with their purchases amid rising costs, according to Deloitte Canada’s 2026 holiday retail outlook.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountDeloitte said spending on holiday entertaining and experiences is also expected to have a sharp decline, driving much of the drop to the lowest overall holiday spending level since its survey began.This advertisement has not loaded yet, but your article continues below.Spending on holiday entertaining, such as alcohol, cannabis and groceries, is expected to decline 22 per cent, while spending on experiences such as travel, vacation and dining out is expected to go down 20 per cent.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againOverall, holiday spending is expected to drop 14 per cent this year to $1,305, compared to $1,521 in 2025. Gifts, groceries and travel remain the largest planned categories.“Canadians are not cancelling the holiday season, but economic uncertainty is influencing their spending decisions, making them far more discerning,” said Deloitte Canada national retail leader Shaunna Conway.Conway said this shift is creating more price-conscious consumers. Retailers that offer clear, compelling value propositions will be best positioned to earn a place in shoppers’ holiday baskets this year, she said.The report said Canadians’ economic concerns remain high entering this shopping season. It said 83 per cent of respondents express concern about the impact of tariffs on prices and the broader economy.One in three Canadians say their household finances are worse than a year ago, while 45 per cent expect the economy to weaken by 2027.This advertisement has not loaded yet, but your article continues below.As for the trade war, nearly half or 45 per cent of consumers consider Canadian or local ownership important when choosing where to shop, but 35 per cent would choose value and are unwilling to pay a premium for products based solely on local ownership.Black Friday is still set to be busy this holiday season with than half of budgets expected to be spent by the end of the Black Friday and Cyber Monday period.Value will be a primary driver of spending decisions this year, as a result. It said 78 per cent are actively looking for more discounts, promotions and sales to protect their budgets.The survey said 29 per cent of Canadians intend to spend less this year as they become increasingly focused on maximizing value.Shopping journeys are becoming more fragmented, with consumers expecting to visit an average of 16 stores and digital destinations when looking for gifts, up from 14 last year. Consumers aged 35 to 44 plan to shop at an average of 23 retailers this holiday season.While 55 per cent of planned holiday spending is expected to take place in-store, 42 per cent is expected to be done online, with Amazon.com Inc. at 65 per cent and Alphabet Inc. at 64 per cent still the leading sources for holiday shopping research.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.The role of artificial intelligence in retail is also growing. Nearly 40 per cent of consumers plan to use AI for holiday shopping, primarily for gift inspiration, price comparison and deal discovery, compared with 25 per cent in 2025.While generative AI is emerging as a new discovery tool, only 19 per cent of shoppers would be comfortable allowing AI to make purchases on their behalf.Meanwhile, 46 per cent of consumers are willing to provide personal information or share their data for promotions, while 68 per cent worry about data misuse or unclear data practices.The Deloitte Canada surveyed Canadian consumers across age groups, financial situations and regions between Aug. 28 and Sept. 4.We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.