Outlook 2022: Canadian POV
How the four Outlook trends are playing out in our neighbor up north
Written by: Kelvin Mak, Director, Digital Strategy and Partnerships, UM Canada
& contributions from: Erica Kokiw, EVP, Digital, UM Canada; Cory Peters, VP, Digital, UM Canada; Juan Panlilio, VP, Decision Sciences, UM Canada
Much ink has been spilled in history in musing about the nature of change in our lives. That it is the only constant in life. That with transience, meaning emerges in the present.
On that note, welcome to Change, 2022-style — bigger, faster, and even more ever-present.
Entropy.
It’s an odd juxtaposition in the COVID-induced years of 2020 to 2022, when we have gone through more significant changes as a society than ever before — world leaders, wars, health of the planet, supply-chain shortages, inflation, protests, and a pandemic— while at the same time, most of us stayed in place, with our day-to-day lives put on pause because of the surrounding uncertainty. In Canada, we have not been immune. Costs of living continue to rise; debates around vaccine and masking mandates feel like they’ll never cease; Alberta oil, foreign oil, or no oil at all; and, most importantly, what institutions’ and individuals’ roles are in figuring all of this out.
This dissonance is what sets the stage for 2022 being the year of entropy. In an era of greater, non-linear change, we see consumers increasingly looking for brands to help them on their way to finding meaning and authenticity amidst the turbulence.
Power to the People
When comparing the enshrining principles of Canada and the United States, a contrast that is often brought up is the difference in the guiding objective in the two countries’ founding documents. Stateside, the phrase “life, liberty, and the pursuit of happiness” stands out as the nod on individuals’ rights, while north of the border (and across the British Commonwealth), the operative phrase is instead “peace, order, and good government” — signifying a more collectivist bent.
While Canada has seen many of the similar trends that took place south of the border during the two-years-and-counting COVID era, there are also distinctive nuances that separate it from its neighbors.
First off, the similarities: Canada has jumped onto the “meme stocks” bandwagon with options trading in GameStop, AMC, and — appropriately enough — the homegrown Blackberry. While the volatility in share prices, it turns out, was driven largely by the technical mechanisms of the options market, it was framed more compellingly as a “retail vs. hedge fund” fight. On one side, corporatized hedge funds trying to “short”, or keep the prices low, to profit from their negative bets; and on the other, individual retail traders fighting back to “squeeze” prices higher.
The meme stock phenomenon, alongside increasing economic inflation — chief among them rising property prices blamed largely on foreign investors, against whom the government is largely perceived as taking tempered, ineffective actions — set the stage of inequality against the common people. To cap it off, a survey near the end of 2021 showed three in five Canadians are seeking a second source of income, illustrating the hunger to even up their take.
The key distinction, for Canada, is that much of the movement to “get even” has been limited within the economic realm so far. While it’s undeniable that from a social lens, the discourse has taken on a course of increased polarization, with a focus on government ineffectiveness, the reality is that the rate has been slower than the U.S., and its effects less widespread.
Take the Freedom Convoy for example: a protest formed largely by truckers to protest the various federal and provincial vaccine mandates through a “blockade” in a number of Canadian cities. It took in its fair share of headlines across the country and the world, and served as a rallying cry for many anti-mandate proponents. But as it turns out, 62% of Canadians oppose the convoy, and in fact, the majority of truckers are vaccinated. And in an ironic twist, the government has since banned the convoy organizers’ access to their cryptocurrency donations — crypto symbolizing the “DeFi” movement, which promises financial tools that bypass centralized institutions.
As the overall theme of the decentralization of power continue to resonate and gain traction in Canada, it’s important to note that the underlying objective is likely different than the U.S.. As evidenced by how the convoy protest played out, there is less desire to “stick it to the man” in an adversarial manner, but more simply to make things easier and more profitable through the democratization of access. And it’s important to note that, compared to their U.S. counterparts, the Canadian government and public institutions are likely to be more proactive in retaining control over its financial mechanism. Therefore, for regular Canadians, the utopian vision painted by some crypto advocates may face a lot more regulatory challenges.
So then, what does a brand make of all of this? When considering “Power to the People”, there is still value in gaining a consumer’s trust by putting an organization’s value front and center, and subsequently turning customers into advocates. However, especially for brands adapting messaging from the U.S., the focus needs to be more focused on the tangible benefits instead of an empty rallying cry. Instead of jump-starting a revolution, begin with fostering a community.
Lifecycle loyalty
Between the growing anxiety of the climate crisis, to the rapidly increasing inflation rate, it’s safe to say that the Canadian consumer’s purchasing mindset has evolved over the recent years. Even if a product is meant to be disposable, there is still a growing appetite to maximize its longevity before its expiration date.
Not only are consumers increasingly paying attention to their carbon footprint — 61% of Canadians have paid more attention to the environmental impact of what they consume — they are also looking to companies to help address sustainability concerns. While this should represent an easy sell for brands looking to capitalize on the trend, these same consumers are often deterred by concerns around high prices, poor quality, and lack of trust.
In many ways, this is a very Canadian dilemma: The desire to become more socially and environmentally responsible, countered by a perceived disappointment from brands failing to provide consumers with the right solutions. The appetite is certainly there to prolong the life cycle of products, but most companies still have a long way to go to fulfil that growing consumer demand.
Customer education is a good place to start. Given the widespread perception of some brands engaging in “greenwashing,” a form of PR spin designed to convince consumers that a company is doing more to help the environment than is actually doing, brands need to do a better job of being more upfront with the initiatives they are taking on.
The need to be more transparent in a brand’s green efforts (and in some cases, the need to refrain from the conversation when there is nothing for brands to contribute) is more important than ever, as consumers are only becoming more knowledgeable in the space. The key here is to truly lead with values, and be transparent and authentic about addressing any shortcomings. The Canadian fashion company Canada Goose, for example, launched the Humanature Capsule line, where its jackets are created 100% from either recycled or sustainably sourced materials. While companies sourcing materials in a sustainable manner isn’t anything new, for a company that has been a target of criticism from animal-rights groups, it’s aimed to address a shortfall its brand identity, while providing consumers an ethical comfort in continuing their relationships with the brand.
Second, the importance in anticipating consumer needs is also growing. The proliferation of connected devices, both in and out of the home, along with the advances in machine learning, means that brands will have more signals and opportunities to anticipate when a customer would need an upgrade, additional functionalities, or just a pick-me-up from a brand. The end goal here is to be able to gather enough contextual data on customer preference and habits to accurately predict moments of receptivity after the transaction when they make the initial purchase.
Take H&M for example. Looking to shed its image as a “fast fashion” entity, H&M launched its Rewear platform that enables users to sell used H&M clothing directly to each other, with the retailer providing input in suggesting pricing, and incentivizing people to transact by offering discounts for future purchases. This illustrates of the advantages of first-party brands helping users extend the life of their products through transactions, and fosters the relationship well before their second transaction.
In the case of Harry Rosen, a Canadian high-end men’s clothing retailer, its drive to digitally transform its operations had led to the brand putting its CRM data to good use. From bespoke landing pages to clothing recommendations via chats with their style advisers, the retailer aims to personalize customers’ online and offline experience and prolong customer relationships, whether it’s in the section that a sales associate would take the consumer to first, or in the products that get shown when they log onto the website. Simply put, it’s a subtle and smart way to make use of first-party consumer intelligence to create bespoke experiences.
Similarly, many brands have ramped up their CRM efforts as a result of third-party cookie deprecation. For Canada specifically, however, this will be interesting to watch to see how privacy regulations catch up with the increasing connection points. While the country is by no means a leader in privacy laws, it does tend to be more regulated than the United States in certain aspects, and therefore global brands will need to be able to adopt their personalization approaches to adhere to any forthcoming regulations. For now, brands can focus on building up their CRM data and testing out AI solutions, with the two prongs working together to improve the accuracy in anticipation of consumers’ future needs.
The Multiplayer Internet
It’s easy to conflate between the concept of the Multiplayer Internet with, you guessed it, the metaverse. And while the two certainly have overlaps, we termed the phrase “the multiplayer internet” to describe many of the metaverse-lite vehicles where consumers show off their virtual presences and participate in group-oriented social experiences, in ways that were traditionally limited to a physical form. It unlocks the idea of “time-shifted togetherness,” allowing consumers to experience live events at their own pace.
In late January, when the Canadian Men’s Soccer Team took on their U.S. rivals in a World Cup Qualifying match, Alphonso Davies, arguably Canada’s best player, was ruled out of the match with myocarditis. And instead of watching his team from the stands (it was a freezing negative 13 degrees Celsius in Hamilton, which probably didn’t help), Davies did what anyone with an internet connection would do: he took to Twitch with his father, and livestreamed their viewing of the live match.
In many ways, this is a perfect encapsulation of the current phase we are in with regards to the internet: building the behavioral stepping-stones that will eventually become part of the metaverse, in the bringing together of online presences.
The increasing awareness of online presence also unlock new types of experiences that brands can tap into. It’s the myriads of “co’s” that you may have heard plenty of times already: “co-watching”, “co-viewing”, “co-shopping”, for example. No matter the verb that follows, the idea is similar: socially driven virtual experiences designed to bridge the physical divide. Artery, a Toronto-based cultural “meetup” event organizer, were bringing together strangers in people’s homes and other venues for cultural experiences, like music and dance performances during the pre-pandemic era. As part of the lockdown-induced pivot, the team created Bramble, a video conferencing platform that works like a hybrid between Zoom and Animal Crossing, allowing users to walk around, mingle, and interact with each other in a virtual space, while still serving up cultural experiences through the screen.
Whatever these experiences may be, it also helps tackle what is very much a quintessential Canadian marketing conundrum: the significant concentration of population in a few cities. Traditionally, this issue has impacted Canadian brands negatively in both retail and marketing strategies — stores and their messaging have only so many cities available to be present within, and it resulted either in higher costs due to competition, or lack of availability, or likely both. At the very least, the trend towards a greater focus in online presence should help address this inventory supply issue. Plus, in the world of virtual concerts, livestreamed workouts, and live commerce, buzzworthy events can take place at scale, reaching the relevant audiences from coast to coast, transcending the limits of geographical scatteredness in Canada.
There’s an old quip that while most new, buzzy consumer fads are two years away from mass adoption, in Canada, it’d be two years from being two years away, thanks to a mix of infrastructure, regulatory, and product availability. However, in the case of the multiplayer internet, where the concept and behaviors rely on essentially current technologies, it will likely prove to be an exception to the rule. Therefore, brands that tend to wait for Canadian adoption will need to prepare as quickly as their global counterparts, as the traditional lag time will diminish.
Another interesting caveat is in considering how content in those digital venues will be regulated in Canada. While legislations are on tap to regulate a variety of digital content, from streaming audio, video, and user generated content on social networks, these regulations are aimed at produced content that are meant to be consumed after the fact. It remains to be seen how the more immediate nature of these new multiplayer experiences fall into regulatory discussions, and how much more stringent these may be compared to the U.S.
As we shift towards a world where our digital presences are prioritized, and many of the traditional constraints are smashed, brands will need to take action today by figuring out the key intersections between audience need and brand proposition. No matter the variation, multiplayer digital experiences have one common thread that connects them: a sense of community. For a brand to succeed in tackling the burgeoning multiplayer internet (and later on the metaverse), it needs to constantly define and keep in mind its purpose in relation to consumer habits.
The Great Escape
The cottage — for those unfamiliar, generally a second-home for a family that’s located in a rural, picturesque area — has long been a symbol to many Canadians as a metaphor for disconnecting from the world at large. Families would travel out to cottage country, predominantly during the summer, to spend time amongst nature and loved ones.
So it’s with little surprise that, according to Statistics Canada, as part of the COVID-induced “Great Relocation”, four of Canada’s top 10 fastest growing regions happened to be in Ontario’s “cottage country”.
What does that tell us? That the yearn for an escape has been increasingly present amongst many facets of Canadian life. Physically, there are a number of Canadians that are reimagining how their lives are lived, trading the perks of working and living in a city to the more peaceful, not to mention affordable, world of rural townships. It’s indicative of a mindset that is slowly shifting from the always-hustling, results-oriented mentality, to one that is more deliberate in what in life, exactly, needs to be valued.
If the past two years and its on-and-off shutdowns have taught us anything, it’s that the desire to pursue invigorating experiences has never gone away. As seen with the uptick in travel-related demand once each lockdown has lifted, the yearning to get away remains. As a result, stemming from both an adoption to consumer behavior and self-preservation, companies have pivoted to offer escapist experiences in whichever way they can. Fine-dining restaurants serving takeout, art galleries and museums offering virtual tours.
The Drake Hotel, a well-known boutique hotel in downtown Toronto, offered a virtual New Year’s Eve party with to-go dinner and drinks, as well as live-streamed entertainment, that illustrated how a company can cater to both the physical and digital escape. In a backdrop of constant COVID-induced uncertainty and anxiety, having a “normal” New Year’s Eve party is nothing to scoff at.
Of course, there are those who would rather escape fully into the digital world. As the effects of entropy becomes more pronounced, it’s tempting to forego the efforts to look for normalcy, and instead just take some time off in a place where there’s more control over what you’re exposed to. This is something that the digital world does well at — resembling a simulation of the real one, but giving users a lot more power what they keep out.
That being said, it’s important to keep in mind not only what consumers are escaping from, but also escaping to. More often than not, there is something else that fills the space. Escapes to more curated online communities, away from everyday discourse, can mean more exposure for groups that have traditionally gathered online as a sanctuary. So these escape acts don’t need to be fundamentally nihilistic — depending on the way in which that space is filled, it’s entirely possible that the energy can be put to something meaningful. For example, Helping Hands, an online community in VRChat — an online world similar to its predecessors, Second Life and Habbo Hotel –has grown and become a connecting place for the D/deaf and hard-of-hearing communities with other visitors, and has created a VR world functioning on Sign Language, using this as an education opportunity.
As we attempt find semblances of peace in this era of entropy, the idea of purpose acts as the north star. For so long, the general populace has been fine with being told what matters, but now they are more likely to exercise some control over the messages and channels that they expose themselves to. This great escape, a reflexive reaction to the general fatigue that has plagued us in this era of entropy, has profound implications for brands and how they choose to speak to their consumers.
We have seen a shift from brands espousing their values in a one-way manner, to now the consumer having more power in deciding whether this supposed purpose aligns. The takeaways for companies are twofold. One, if you’re going to stand for something, you better do it well. From a values standpoint, consumers now have become very savvy (and opinionated) in detecting authenticity.
Second, it’s not enough to just be authentic, relevance also matters a great deal. Being everything to everyone was never a great idea to start with, and now with this backdrop of fatigue amongst the many connection points we’re exposed to, brands risk being tuned out more than ever. For companies in Canada (especially those with a global connection), this goes back to the same old theme of ensuring there is a sufficient understanding of the local culture — consider again the idea that when a consumer escapes from something, there needs to be something at the other end for them to gravitate to.
To simply adapt a global message is not enough, it needs to get to the heart of what makes Canadians tick. The challenge is in understanding the nation’s culture, its passion points, the rituals that we partake in, and consequently bringing it together to locate the place where a brand would authentically fit. Because without a thorough understanding of what it all means — like cottages, for example — it will be difficult for brands to be a partner in this great escape, and instead get tuned out as just one more noisy advertiser.
If this refrain sounds familiar to some of the previous trends, that’s because it is: to succeed in a world where entropy is the norm, purpose is paramount.
