What Canadians Spent on Cannabis and Clothing Pre and During the COVID-19 pandemic.
A data storytelling project using Tableau.
Earlier in the year, I published my first article on RFM analysis. After the publication, I started to think about my next project, and not long after, I had a eureka moment (aka the aha moment). I thought it would be interesting to work on a project that explores Canadians spending during the COVID-19 pandemic. I was curious to know if the pandemic in any way has influenced Canadians spending habits. I started searching for datasets and I found this retail spending dataset from Statistics Canada.
About the Dataset
The dataset used for this analysis is a monthly retail spending survey that collects data on retail commodity spending in Canada. The survey is a sample survey with a cross-sectional design and is statistically representative of the Canadian population. Hence, the monthly spending amount on the commodities only includes a sample of the population and not the entire Canadian population as you might observe the monthly spending amount on the commodity items may seem lower than what is expected. You can explore the Retail Commodity Survey here.
The reference period of the data is from Jan 2019 to date. For the purpose of this project, I explored the data for March - December 2019 (pre-pandemic) and March - December 2020 (during the pandemic). I intentionally chose March as the start month of my analysis because lockdown restrictions were imposed in Canada at that time. You can explore the full dataset here.
Data Exploration and Visualization
The dataset consists of 27 commodity categories of which I selected a few that I was curious about such as food, alcoholic beverages, clothing, books, and cannabis products (cannabis and cannabis products are used interchangeably in the article).
I had one research question on my mind:
did spending on these commodity items increase or decrease significantly in 2020 (during the pandemic) when compared to the spending on the same products in 2019 (pre-pandemic)?
To answer the research question, I explored and visualized the sales data for 5 commodities — food, alcoholic beverages, cannabis products, clothing, and books using Tableau (if you don’t know, Tableau is my favorite data visualization tool 😊). During the exploration of the data, I observed a substantial difference between sales of cannabis in 2019 and 2020 and sales of clothing in 2019 and 2020. Also, I noticed a contrast in the spending pattern between the two commodities during the pandemic. For these reasons, I chose cannabis and clothing as the two commodities to focus on. To start off, I calculated a Year over Year (YOY) difference and percentage of cannabis sales (2019 vs 2020), and clothing sales (2019 vs 2020). Below are the screenshots of the monthly amount spent on cannabis and clothing, the YOY difference, and YOY%.
Further, I explored a few charts for the visualization of the data. I decided to chose the bar-in-bar chart for cannabis and a line chart for clothing because they clearly showed the variation in spending between the two years.
Cannabis Spending Bar-in-bar Chart
Cannabis Spending Insights:
- Canadians spent 53.3% more on cannabis products in 2020 (March- December) when compared to 2019 (March - December).
- In March 2020, the amount spent on cannabis products increased by 66.5% when compared to March 2019. The spending did triple from $60,764 in 2019 to $181,180 in 2020.
- In December 2019 and 2020, Canadians spent the highest on Cannabis products.
Clothing Sales Line Chart
Clothing Insights:
- Canadians spent 37% less on clothes in 2020 (March - December) when compared to 2019 (March - December).
- In April 2020, the amount spent on clothing declined by 327.4% when compared to April 2019.
- The amount spent on clothing began to slowly increase by May 2020 and by June 2020, there was a 74% increase from April ($531,033) to June($2,081,744). Could this spike be attributed to summer shopping?
- The highest amount spent on clothing was recorded in December for both years. Is this increased spending due to seasonal shopping for Christmas and the holidays?
Research Outcome
The objective of this project was to discover if Canadians spending on cannabis and clothing increased or decreased significantly when we compare the amount spent in 2019 (before COVID-19) and 2020 (during COVID-19). Did the pandemic influence the variation in spending behaviors?
The visualized data clearly shows substantial variation between the amount spent on cannabis products and clothing in 2019 and 2020. Therefore, my research question was answered. Indeed, the spending on cannabis increased significantly in 2020 by 53% when compared to 2019 spending, and spending on clothing decreased significantly in 2020 by 37% when compared to 2019 spending. (The reference data for both years are from March-December).
Below is the screenshot of the dashboard, you can explore the dashboard via my Tableau public.
What factors contributed to the variation of Cannabis and clothing spending during the COVID-19 pandemic?
You might be wondering why the sales of Cannabis (products) spiked up in 2020 by 53% especially in March 2020 when there was a record of 66.5% increased spending. Also, what happened to the sales of clothing? Why was there a drastic decline in sales by 327.4% in April 2020 when compared to sales in April 2019? The answers to these questions may seem obvious, and if you are thinking “the pandemic”, you are absolutely right! Indeed, the pandemic shifted people’s shopping priorities and influenced some unique purchasing patterns. Here’s what I think happened:
In Canada, cannabis stores were declared as an essential business when the lockdown restriction was imposed in March 2020 therefore there was no access restriction to purchasing cannabis either in-store or online¹. Also, increased social acceptance and the soar of cannabis stores, and the range of products in the past year has made cannabis more accessible to many more consumers². From a mental health perspective, I question if there is a relationship between the spike of cannabis consumption and reported mental health issues (anxiety, depression, and boredom) due to self-isolation and social restriction? The answer is yes! According to Statistic Canada, 65% of cannabis consumers reported stress, 58% reported boredom and 39% reported loneliness as factors that contributed to their increased cannabis consumption in 2020. About 34% of Canadians who previously consumed cannabis before the pandemic said that their consumption increased, 45% of respondents who increased their consumption said they “often” or “always” felt they lacked companionship since the beginning of the pandemic². The social and physical restriction of not seeing family and friends, not engaging in in-person sport, religious and social activities increased stress levels, loneliness, and boredom. Further, the quarantine measures imposed during the pandemic especially during the first wave affected most Canadians routine which influenced the increased consumption of cannabis during the pandemic.
On the contrary, clothing stores were categorized as non-essential businesses. The government imposed restrictions on in-store shopping, and consumers only had the option to shop online during the early months of the lockdown and also for the most part of the lockdown. When the lockdown was announced in March 2020, Canadians priorities for clothing apparel shifted for obvious reasons. Most people were working remotely from home and there seemed to be no urgent need to buy new clothing apparel for work, weddings, parties, prom, and graduation ceremonies³. Sales reported by Statistic Canada⁴ show a plunge in sales in April 2019 from $2.2m to $531,033 in April 2020. This data is shown in the line chart above and in the dashboard. Further, about half of retailers in clothing and clothing accessories stores reported their stores were closed for an average of 6 days in December 2020 and 20 days in April 2020⁵. The latter supports the sharp decline of clothing spending by 327 % in April 2020 as shown in the line chart.
Closing remarks
It is undeniable that Canadians spending habits and behaviors have shifted since the beginning of the pandemic. We now know that Canadians spent more on cannabis and less on clothing during the pandemic in 2020. This shift did not happen naturally, however it was influenced by government rules involving the purchase of “essential” and “non-essential” items, and Canadian’s accessibility to these items. For example, cannabis was categorized as an essential commodity whereas clothing was non-essential which is one of the reasons why the cannabis industry flourished and the clothing retail industry declined during the pandemic. Although, I don’t think people would have spent the same amount on clothing in 2020 as they did in 2019 even if clothing was categorized as an essential item. This is because most Canadians stayed more at home during the lockdown period, and there was no pressing need to buy new clothing. In the case of cannabis, government restriction on social and physical interactions increased stress, anxiety, boredom, and loneliness which led to higher purchase and consumption of cannabis which led to the bloom of the cannabis industry. I am of the opinion that government restrictions on stay-at-home orders, and businesses lockdown played a pivotal role in what Canadians spent on cannabis and clothing during the pandemic in 2020.
On a final note, it would be interesting to know what story the data will tell us about cannabis and retail clothing in the next 1 or 2 years when life gets back to normal (without any restriction). Would the spending on cannabis continue to soar or will it decline? Would the percentage of respondents who increased their consumption of cannabis due to lack of companionship decline? Would the increased spending and consumption of cannabis become a norm? For clothing, I am curious to know if the shift from working in the office to a fully remote and hybrid work style would influence Canadians purchases of clothing. Would Canadians spend more or less on clothing if they are working from home frequently or often? These are the questions on my mind and I hope to analyze this data in the future to answer these questions.
I hope you enjoyed reading the article as I enjoyed writing it. I would love to know your thoughts about the data, the insights, and the factors you think contributed to the spending shift of cannabis and clothing. I look forward to reading your comments.
References
[1]Canadian Centre on Substance Use and Addiction, Cannabis Retail During COVID-19 (Jan 2021), https://www.ccsa.ca/sites/default/files/2021-01/CCSA-COVID-19-Cannabis-Retail-Policy-Brief-2021-en.pdf
[2]Statistics Canada, Alcohol and cannabis use during the pandemic: Canadian Perspectives Survey Series6 (2020), https://www150.statcan.gc.ca/n1/daily-quotidien/210304/dq210304a-eng.htm
[3]Bob Kirke and Elliot Lifson, The Way We Wore: The COVID Crisis in Canada’s Clothing Industry (2020), https://www.policymagazine.ca/the-way-we-wore-the-covid-crisis-in-canadas-clothing-industry/
[4]Statistics Canada, Retail commodity survey, monthly retail sales (x 1,000)(2021),https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=2010001701
[5]Statistics Canada, Retail trade, December 2020 (2021), https://www150.statcan.gc.ca/n1/daily-quotidien/210219/dq210219a-eng.htm
