Key Trends Shaping Canadian Retail Now

We are already into Q3 (we are just flying through 2025!). With rapidly changing consumer behaviors, evolving technologies, and a stronger focus on sustainability, Canadian retail is experiencing remarkable shifts. Not to mention the looming tariffs threats from our partners to the south. Certainly this has been a year of change, and I'm here to break some of the trends we are seeing.

The Support Canada Movement

With the continuous threat of tariffs products from the US, this has ignited a movement of buying local across Canada. Canadian shoppers are increasingly supporting local businesses and seeking items made within the country. Recent surveys from KPMG indicate that over 80% of Canadians are actively trying to purchase more Canadian goods, with some studies even showing figures closer to 90%. This trend is driven by a desire to support the Canadian economy and local businesses, especially in light of recent trade tensions with the US. 

This trend has also encouraged retailers to stock locally sourced items. Stores like Farm Boy are highlighting partnerships with local farmers and artisans, offering unique, high-quality products that reflect regional identity. Whereas companies such as Loblaw Companies Limited have developed innovative ways to identify "Made in Canada" products in-store through using a Maple Leaf identifier, as well as a "T" symbol to identify those that are coming from the US with tariffs imposed on them. More on this can be found here. Loblaws has also brought this same experience on their mobile app, with the addition of a "Swap to Canadian" feature, truly making it easier for online shoppers to support Canadian products.

The Rise of Sustainable Retail Practices

Sustainability is becoming increasingly important for Canadian consumers. According to Agriculture and Agri-Food Canada, 80% of Canadians value a sustainable lifestyle and are concerned about the environment, with 65% of Canadians feeling a moral obligation to use eco-friendly products. Shoppers are becoming more aware of the environmental impact of their purchases, prompting retailers to adopt greener practices and provide more eco-friendly products. Brands are prioritizing sustainable sourcing, minimizing waste, and implementing recycling programs.

Some retailers that are doing it well:

• Staples Canada has not only implemented in-store recycling programs for everything from Writing Instruments to Electronics, but has introduced programs with their business customers through Fifty Green Program. They also make it easy for consumers to shop sustain products through a curated section on their website of sustainable products.

• IKEA Canada focuses on circularity and waste reduction, encouraging customers to return used items for store credit and promoting the resale of gently used products.

• Loblaw Companies Limited is actively working to reduce food waste through various initiatives, with a goal of sending zero food waste to landfills by 2030.

The Importance of Community and Connection

The significance of community in retail is increasingly clear in 2025. Consumers are looking for connections beyond just products. Retailers are responding by creating spaces for interaction and hosting community events.

Large Canadian retailers such as Canadian Tire have been doing this for awhile through programs such as Jumpstart, helping kids overcome financial and accessibility barriers to sport and recreation. That have supported several inclusive play spaces across Canada, which you can find here.

Stores are transforming into community hubs that provide more than shopping opportunities. Workshops, classes, and local art showcases foster a sense of belonging. For example, MEC (Mountain Equipment Co-op) offers free clinics and groups, strengthening ties with customers and positioning their brand as more than just a retail outlet.

Technological Integration and Innovation

Technology is revolutionizing the retail sector faster than ever before. In 2025, retailers are leveraging innovations to enhance the shopping experience, streamline operations, and gather consumer insights.

Retailers are utilizing Augmented Reality (AR) to let shoppers visualize products in their homes before making a purchase. For example, IKEA has an app that allows customers to see how furniture would look in their space.

Artificial Intelligence (AI) is becoming essential for inventory management and customer service. It's becoming standard for many online retailers to use chatbots on their websites to assist customers in real-time, significantly improving their overall shopping experience.

Omnichannel Experiences

The future of retail is undeniably omnichannel. As I chat with retail professionals, it's clear that the lines between online and offline shopping are blurring. Retailers are adopting strategies to ensure a seamless experience for customers, no matter how they choose to shop.

For example, Walmart Canada has improved its website to facilitate online ordering with in-store pickup, responding directly to customer needs for convenience. Having used this recently, I was pretty impressed with the ease of using this service and how well it integrated with my profile offering real-time updates and upsell opportunities. Retailers like Indigo have incorporated technology in their stores through digital displays, interactive events, and personalized in-store experiences that resonate with customers.

Enhanced Customer Engagement through Personalization

Personalization is crucial in Canadian retail in 2025. Retailers are increasingly using data analytics to tailor marketing efforts, product recommendations, and in-store experiences based on customer behaviors. According to sources such as Contentful, this individualized approach can increase customer retention rates by as much as 65%.

Many retailers implement loyalty programs that reward shoppers based on their preferences and buying habits. Loblaw's PC Optimum does this incredibly well by offering personalized offers to shoppers based on past buying history. Same with Canadian Tire's Triangle program which offers personalized offers based on buying patterns and data to serve offers not only for Canadian Tire but their other brands such as Party City and Marks. For more interesting insights about personalization in Canadian Retail, check out this link.

Looking Ahead

From sustainability and technological innovations to personalized services and support for local products, these trends are reshaping the industry. Retailers must remain adaptable and embrace these changes to meet evolving consumer expectations.

As we progress through the year, retailers need to focus on creating better experiences for consumers. Adapting to these changes is not just about survival; it positions retailers as leaders in this dynamic market. I look forward to watching how these trends continue to shape our industry and influence consumer behavior.

Are there any trends you are seeing in retail? What impressed you and what do you think is to come? Share in the comments below.