Canadian shoppers to flock to big box stores

Wed Dec 9, 2009 6:06pm EST
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TORONTO (Reuters) - Canadian consumers are expected to head to big box stores with cash in hand, studies showed on Wednesday, as they scramble to put the finishing touches on their Christmas purchases.

But these same shoppers are also expected to continue their frugal ways and spend between C$570 and C$586 ($538 to $553) on gifts, about the same level as last year when the economic downturn sapped consumer confidence.

"The Canadian consumer has been impressively resilient in the last 12 months, but retailers will need to continue to offer solid value at competitive prices through the next several weeks in order to be successful during the 2009 holiday shopping season," said Pam Wood, a senior manager at The NPD Group, a consumer and retail information company.

NPD found people were being careful with their money and were still cautious about the economy, despite a modest improvement in the last two quarters, with 55 percent of those surveyed indicating they would pay for their purchases with cash instead of credit cards.

The majority are also expected to seek out bargains at big box stores, with more than 60 percent planning to head to names such as Wal-Mart Stores, while about 43 percent plan to hit the department stores such as Sears Canada and Zellers. Another 31 percent intend to shop at electronics retailers and about 30 percent at toy stores.

And they plan to head to the stores where they can count on competitive prices and good customer service, another retail survey found.

"Customers aren't letting retailers off the hook just because it's the busy holiday season," said Rob Daniel, managing director, Maritz Research Canada.

"They have the same high expectations for customer service that they have throughout the rest of the year. Price is still king, but our research tells us that customer experience plays a crucial role, and will be remembered long after a customer has forgotten what they paid."

Clothing, toys and books appear to be the top items on Christmas shopping lists, while gift certificates, electronics and clothing are on most people's wish lists.

With a little over two weeks to go before the big day, the malls and stores are also expected to see increased volume as Canadians still have about half of their shopping left to do, the Maritz survey found.

($1=$1.06 Canadian) (Reporting by Scott Anderson; editing by Rob Wilson)

<p>People go shopping in a mall in downtown Toronto, December 23, 2008. REUTERS/Mark Blinch</p>