Retail is transforming, shifts in consumer values, and economic headwinds. But beyond the buzz, what are Canadians truly prioritizing this year?
Retail Trend #1: Sales Rebound, Then Pull Back
Canadian retail sales have become increasingly volatile, reflecting shifting consumer sentiment and macroeconomic pressures. In June 2024, retail volumes jumped 1.5% to C$70.2 billion, marking a short-term rebound in consumer demand. However, this momentum quickly reversed with a 0.8% decline in July, revealing how fragile retail growth remains in an uncertain economic environment.
A similar pattern played out at the end of the year: December 2024 saw a strong 2.5% lift in sales, largely driven by temporary factors like a province-wide sales tax break. But this uptick was short-lived, followed by a 0.6% pullback in January 2025 as shoppers tightened their wallets and seasonal demand faded.
Why It Matters
For retailers, these erratic sales patterns indciate signals of shifting customer priorities and tightening spending habits. To stay competitive, merchants must be more agile than ever, not just in inventory or staffing, but in how they manage and streamline front-end payment performance.
Offering faster, more familiar payment options, such as Alipay, WeChat Pay, and UnionPay, can directly influence purchasing decisions, especially for international or high-value customers. In an environment where every transaction counts, optimizing for speed, convenience, and trust at checkout can be the edge that helps merchants maintain steady revenue even when broader trends remain volatile.
Retail Trend #2: Cross-Border Commerce
Cross-border e-commerce is the norm for Canadian shoppers and sellers alike. Over 55.5% of Canadian consumers purchased from international retailers in the past year, the highest rate in North America. On the merchant side, nearly 1 in 5 Canadian e-commerce businesses now generate the majority of their revenue from international markets.
This momentum is being mirrored in infrastructure: Canada’s cross-border e-commerce logistics market is projected to grow from US$6 billion in 2024 to a staggering US$22.8 billion by 2030, expanding at a compound annual growth rate of 25.3%. This signals massive investment in global fulfillment, customs optimization, and last-mile delivery to meet increasing cross-border demand.
Why It Matters
For Canadian retailers, the message is clear: global customers are within reach, but only if you remove the friction.
Integrating with trusted international payment methods like Alipay, WeChat Pay, and UnionPay is essential to unlocking these markets. These platforms are not only familiar and preferred by international consumers (particularly from China and other parts of Asia), but also come with built-in marketing, security, and data analytics advantages.
As global e-commerce amps up, localized payments will be the linchpin of successful cross-border strategies that can impact both conversion rates and customer loyalty.
Retail Trend #3: The “Buy Canadian” Momentum
Amid growing trade tensions and geopolitical friction, Canadian consumer sentiment is shifting inward. A striking 85% of Canadians now say they’re intentionally replacing U.S. products where possible, and 98% are actively seeking out “Proudly Canadian” labels when they shop. Cross-border travel is also down, driven by informal boycotts and a decline in consumer confidence abroad.
This signals a powerful turn toward economic nationalism, with shoppers prioritizing local products and values over price or brand.
Why It Matters
Retailers who embrace this movement can build stronger customer loyalty through how they message and market that local connection.
Highlighting Canadian-made products, offering bilingual (English/French or even Mandarin) checkout flows, and embedding patriotic cues into digital wallets, receipts, and loyalty platforms can reinforce trust and resonate with value-driven customers.
When brand perception and national identity intersect, even subtle UX cues at checkout can make a lasting impact.
Retail Trend #4: E-Commerce Growth & Tight Budgets
Even as Canadians tighten their spending, they’re not abandoning retail—they’re becoming more intentional. Loblaw Companies recently reported a 5.4% rise in in-store retail sales alongside a surge of 17.5% in e-commerce, underscoring a growing consumer shift toward value-driven purchases and the convenience of digital shopping, especially at discount and essential goods retailers.
This trend reflects a broader consumer behavior pattern: people are shopping smarter, comparing prices online, and leaning on loyalty programs and digital discounts to stretch their dollars.
Why It Matters
In order to get ahead, retailers must meet shoppers where they are: online, price-conscious, and loyalty-minded.
This is where embedded payment solutions can come in. By integrating with mobile wallets like Alipay, WeChat Pay, and UnionPay, retailers can seamlessly offer localized promotions, rewards, and membership perks at checkout. These platforms enable retailers to deliver personalized offers and simplified payment flows without sacrificing margin or UX.
In a budget-conscious market, trust, familiarity, and convenience can make the difference between a bounce and a conversion.
Retail Trend #5: Economic Strain Meets High Youth Unemployment
Canada is facing a persistent youth employment crisis, with unemployment among young Canadians at 14.5% as of August 2025 (the highest level since 2010, excluding pandemic disruptions). This financial pressure on Gen Z and young millennials is shaping their retail behaviors, making them more cost-conscious, digitally savvy, and selective about where and how they spend.
While temporary measures like tax breaks have sparked short-lived spikes in spending, these are not sustainable solutions. The underlying speculations of economic insecurity is pushing younger consumers to seek value, flexibility, and control.
Why It Matters
For retailers, this means adapting to a new kind of shopper, one that demands affordability without friction.
Introducing flexible, youth-friendly payment options like Buy Now, Pay Later (BNPL) can help capture this demographic by spreading costs over time without traditional credit barriers. Paired with mobile-first wallets, loyalty integration, and personalized discounts, these features help build trust and accessibility in a tough economy.
Retail Trend #6: Omnichannel & Embedded Payments
Even in an unpredictable economy, consumer expectations continue to surround seamless, unified shopping experiences. Whether buying online, in-store, or through mobile, today’s shoppers demand consistency. This is particularly true for international consumers who rely on trusted wallets.
Why It Matters
As retail journeys span multiple touchpoints, omnichannel alignment is critical. That means embedding payment solutions that work flawlessly across e-commerce, an all-in-one POS, and mobile environments, while also supporting localized languages and currencies.
AlphaPay delivers fully embedded payment solutions, Canadian merchants can:
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Maintain consistent checkout flows that boost conversion
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Offer localized marketing, loyalty, and discounts
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Onboard quickly with low fees and no long-term contracts
Ready to Welcome Global Shoppers?
Canadian retail in 2025 may be volatile, but businesses that implement smart, embedded payment strategies are positioned to thrive. It’s about being flexible, trusted, and locally relevant to where your customers shop.
Explore what it means to accept cross border payments with AlphaPay—or connect with our team to get started.
