This is the third report in our series examining RBC’s cardholder data1.

To understand underlying trends, we examined spending differences between small businesses and personal credit cardholders.

Signs of stabilization for households

  • Monthly spending in April was down nearly 30%, worse than the monthly read for March, reflecting that COVID-19 impacted activity over all of April versus only part of March.
  • At the end of April, consumer spending had rebounded somewhat from levels early in the crisis, but remained well below pre-pandemic levels.
  • Automotive spending paid for by card (e.g., maintenance, gas) seemed to have turned the corner, household construction was still strong, and spending on household goods was higher than before the crisis.
  • Discretionary spending had stabilized, albeit at low levels. Spending on restaurants and entertainment was down 50% from before the crisis.



Businesses try to keep the lights on

  • Small business spending on essentials held up better than that of households, as firms cut discretionary spending.
  • Small business spending on software held to pre-COVID trends, while households spent significantly more kitting out home offices.
  • Businesses slashed dining and entertainment expenses, but kept their vehicles running more, cutting gas, automotive and parking expenses less than households.
  • Small businesses avoided cutting telecom spending (while households streamed more content) and trimmed utilities as little as possible.




 

Read report PDF

Download


‡ Methodology

RBC’s consumer spending tracking report uses RBC Data & Analytics’ proprietary database of anonymized card transactions by Canadian clients. The data are an accounting of merchant transactions that are divided into various spending categories covering tens of millions of weekly card transactions worth billions of dollars each week. Transactions, both in person and online, are classified into 11 broad spending groups: Dining, Education, Finances, Groceries, Health, Household, Shopping, Transport, Travel, Utilities, and Other. Within each group, the data are further classified: for example, shopping covers merchants classified as clothing stores, hobby shops, electronics stores, and jewellers, among others.

We examined changes in the value of all transactions in these areas for 7-day periods starting January 1st, comparing spending to the weekly average spending in the first 11 weeks of 2020 (i.e., prior to significant social distancing measures). To examine the impact of important events, we looked at how spending changed on specific days, both on a daily basis and on an annualized basis relative to that same weekday a year ago.

Protecting your privacy and safeguarding your personal information is a cornerstone of our organizational ethics and values and will always be one of our highest priorities. The underlying data for this analysis was aggregated based on transaction date, region and merchant category, and cannot be used to identify any individual client or merchant. For additional information please visit www.rbc.com/privacy.

1Reflects fully anonymized credit and debit card spending.

May 4, 2020

This is the second report in our series examining RBC’s cardholder data1.

  • Consumer spending was still hurting in late April, down 17% from pre-crisis levels but firmer than ~30% in late March.
  • Spending only rose significantly in a few categories, like household construction, suggesting people used at-home time to complete projects, or bought scarce goods wherever they could find them.
  • The concentration of spending and modest changes elsewhere make us wonder whether these green shoots signal braver consumers, or if spending will fall back down soon. Fresh data for the rest of April, due in a few weeks, will complete the picture.


Tiles, not turtlenecks

  • Spending on household goods and services climbed to pre-crisis levels, driven by spending at construction material, appliance, and furniture stores.
  • Software spending remained strong, while discretionary goods like clothing only increased slightly.


Driving, not departures

  • Automotive and gas expenditures rose, likely reflecting gas prices that recovered from crisis lows.
  • Local and international travel spending remain down more than 80%.


On demand, not on display

  • Canadians continued to seek at-home entertainment, spending strongly at merchants selling books, music and other goods, and on services like cable and streaming.
  • Spending at movie theatres and art galleries was decimated by mandatory closures; some other entertainment and art merchants saw an uptick in the week of April 21 likely reflecting digital subscriptions.


Delivery, not dinner out

  • Spending on groceries remained robust as most Canadians dine in.
  • Restaurant spending remains down more than 50%, but ticked up recently as consumers started using take-out and delivery services.


Read report PDF

Download


‡ Methodology

RBC’s consumer spending tracking report uses RBC Data & Analytics’ proprietary database of anonymized card transactions by Canadian clients. The data are an accounting of merchant transactions that are divided into various spending categories covering tens of millions of weekly card transactions worth billions of dollars each week. Transactions, both in person and online, are classified into 11 broad spending groups: Dining, Education, Finances, Groceries, Health, Household, Shopping, Transport, Travel, Utilities, and Other. Within each group, the data are further classified: for example, shopping covers merchants classified as clothing stores, hobby shops, electronics stores, and jewellers, among others.

We examined changes in the value of all transactions in these areas for 7-day periods starting January 1st, comparing spending to the weekly average spending in the first 11 weeks of 2020 (i.e., prior to significant social distancing measures). To examine the impact of important events, we looked at how spending changed on specific days, both on a daily basis and on an annualized basis relative to that same weekday a year ago.

Protecting your privacy and safeguarding your personal information is a cornerstone of our organizational ethics and values and will always be one of our highest priorities. The underlying data for this analysis was aggregated based on transaction date, region and merchant category, and cannot be used to identify any individual client or merchant. For additional information please visit www.rbc.com/privacy.

1Reflects fully anonymized credit and debit card spending.

April 16, 2020

Note: In order to provide the most accurate and robust insights, the methodology for the COVID Consumer Spending Tracker was recently updated to reflect delays between when transactions occur and when they are recorded in our database. To ensure archived versions of the Tracker are comparable with future versions, we have updated the data below. The key conclusions remain unchanged, though some estimates reflect new data.

It’s not often a Canadian prime minister abruptly upends consumption patterns. Justin Trudeau appears to have inadvertently done that when he went into self-isolation on March 12 after his spouse was diagnosed with COVID-19. That news, along with a 2,350-point plunge in the Dow Jones Industrial Average, served as a one-two gut punch to Canadian consumers struggling to absorb a spike in pandemic-related developments.

Given the lag in the release of official Canadian retail sales figures, we’ve used RBC’s proprietary spending data1 to provide a snapshot of how the COVID-19 pandemic has altered Canadian consumption. We believe RBC’s broad Canadian client base serves as a proxy for national consumption. This is the first report in our series examining spending data up to March 31.



Highlights:

  • March 12 will go down in the record books as a pivotal day for Canadian retail spending.
  • Canadians spent 13% more on March 12 than the same day a year earlier, mainly on groceries.
  • Ottawa’s March 16 announcement that it would close borders to most non-citizens dealt big blows to dining and transportation spending.
  • Ontarians and Quebecers increased their shopping by close to half on the day business closures were announced.
  • Card spending fell ~40% in week ended March 31 versus the same period last year.


Baking, not bistros

  • Grocery spending increased 80% in the week ending March 17th as Trudeau began self-isolating, and stayed notably elevated for two weeks.
  • While grocery shopping patterns subsequently normalized, the slowdown in restaurant spending persisted despite takeout/home delivery options.


Software, not streetwear

  • Software and data services spending held up better than other discretionary categories, as Canadians equipped themselves to work from home.
  • Canadians spent 81% less on apparel, gifts, and jewelry in the week ended March 31.
  • After a brief spike in shopping at big box stores, department store sales were down 21% versus a year earlier.


Streaming, not screenings

  • Spending at movie theatres and art galleries had already slowed ahead of social-distancing measures.
  • Spending on books and music (including streaming and online services) has increased slightly.


Read report PDF

Download


‡ Methodology

RBC’s consumer spending tracking report uses RBC Data & Analytics’ proprietary database of anonymized card transactions by Canadian clients. The data are an accounting of merchant transactions that are divided into various spending categories covering tens of millions of weekly card transactions worth billions of dollars each week. Transactions, both in person and online, are classified into 11 broad spending groups: Dining, Education, Finances, Groceries, Health, Household, Shopping, Transport, Travel, Utilities, and Other. Within each group, the data are further classified: for example, shopping covers merchants classified as clothing stores, hobby shops, electronics stores, and jewellers, among others.

We examined changes in the value of all transactions in these areas for 7-day periods starting January 1st, comparing spending to the amount recorded over the same seven days in 2019. We excluded purely financial items (e.g., cash advances, insurance premiums, currency exchanges, fines). To examine the impact of important events, we looked at how spending changed on specific days, both on a daily basis and on an annualized basis relative to that same weekday a year ago.

Protecting your privacy and safeguarding your personal information is a cornerstone of our organizational ethics and values and will always be one of our highest priorities. The underlying data for this analysis was aggregated based on transaction date, region and merchant category, and cannot be used to identify any individual client or merchant. For additional information please visit www.rbc.com/privacy.

1Reflects fully anonymized credit and debit card spending.


Colin Guldimann is an economist at RBC. He works primarily on issues related to housing markets, energy, and climate change. Prior to joining RBC, Colin worked on housing policy and macroeconomic research at the Department of Finance in Ottawa.

This article is intended as general information only and is not to be relied upon as constituting legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. Information presented is believed to be factual and up-to-date but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or any of its affiliates.