North America is one of the most lucrative markets for businesses that pursue regional expansion strategies. However, the market is far from being homogeneous: from Cuba, Costa Rica and Mexico to The US, Canada, and Saint Martin – each culture is unique. Respectively, the characteristics of each market are unique. This raises issues and poses difficulties for marketers and business owners. While business leaders are usually sensitive about the differences between Hispanophone and anglophone consumers, they often mistakenly assume that anglophone Americans and Canadians can be targeted in the same way. Despite similar cultures and language, Canadian and U.S. consumers don’t think and shop in the same way. In line with several similarities, a plethora of differences exists that every business considering entering the market needs to take into account. To help businesses avoid costly mistakes, we have gathered some comparative data concerning several characteristics and behavioral factors of Canadian and US consumers.
Let’s see what we got:
Spending And Value-Seeking Behavior
On a per capita basis, Americans spend more than Canadians. However, higher spending in the U.S. is mostly driven by people in their prime working age. Americans who are 35-54 years old, not only earn more than Canadians in the same age group, but they spend about US $50,000 more per year. Canadians in all other age groups spend equal to their American counterparts. Moreover, Canadian young adults spend more. Another factor affecting the spending behavior is the difference in the value-seeking approach observed among Canadians and The US population. Canadians tend to be value shoppers, looking for the lowest price or the best deal as opposed to a particular brand. This does not imply that American shoppers aren’t searching for the best deal: Canadian consumers just have a different approach to finding value. They don’t mind making an extra effort to find the best deals. For instance, 87% of Canadians stock up on their favorite products when the products are on sale, 57% go to multiple stores to get the best prices on different items and 56% regularly participate in retail loyalty programs.
Another difference occurs in regards to transportation. Although households in both countries spend more on private transportation (own car) than on public transportation (buses, etc.), Americans drive more (hence, spend more on gasoline).
Canadians aged 25-34 are much more skeptical and judgmental of their peers and themselves. This is particularly true for Millennials. While Americans aged 25-34 see themselves as compassionate and confident, Canadian Millennials are much less likely to see themselves as such. Businesses that target Canadians in this age group must be a bit more reflective about the ways this segment defines being responsible (e.g. being financially independent and/or being young parents). Canadians are less likely than their American counterparts to give credit to other Millennials for being responsible. For instance, this is illustrated by the lack of faith Canadians have in their peers in regards to online reviews. Over three-quarters of American consumers aged 25-34 trust online reviews as much as personal recommendations, whereas only three in five Canadians of the same age claim to have faith in them.
Shopping Preferences And Behavior
Canadians devote a significantly larger share of their budget to housing-related items and services. The way of consumption varies as well. While on a per capita basis Canadians dedicate more to shelter costs, Americans spend more on renovating and decorating their homes.
Another difference concerns online consumption. Canada is 15 spots ahead of the U.S in regards to internet penetration. The country is ranked 14th in the world. The average Canadian spends about 39 hours per month online (excluding mobile or tablet use). However, despite the high rates of penetration, Canadians have been slower than Americans to embrace online shopping. Canadians are still “touch-and-feel” shoppers, finding importance in traditional brick and mortar retail. Besides being more of “brick-and-mortar” shoppers, Canadians dedicate more of their budget to non-discretionary items, whereas Americans allocate a larger share of their spending to discretionary items.
As for the similarities, food is a top spending category in both countries.
The bottom line is that businesses that are aimed at expanding to North American markets, it is important to understand the specifics of target customers in each market. For those selling goods and services, these characteristics can be pivotal for success. Also, It’s essential to note that while the aforementioned differences are the most relevant and trending ones, the list of both differences and similarities is not comprehensive.
On top of that, within country consumer behaviors vary greatly from region to region– just as consumer behavior in New York differs from consumer behavior in Los Angeles, consumer behavior in Ontario varies considerably from that of Quebec.
Keeping both the differences and similarities in mind, Digilite Web Solutions proudly serves both Canadian and US markets. If you’re enticed to learn a bit more about the North American marketing landscape, or if you’d like to find experts that can help you understand the markets, check out our recent infographic that compares Los Angeles and Toronto, two of the most prominent North American cities. By the way, our Digilite has offices in both of these locations.
Note: In May 2019, our Toronto division was selected as one of the Top 20 Agencies of the region by UpCity, a leading North American agency directory.