Are Newcomers a Valuable Target Market for Canadian Businesses?
A misunderstood segment with outsized growth potential
Canada is changing fast. Over the past decade, population growth has been increasingly driven by immigration. Today, newcomers are not just contributing to Canada’s cultural fabric, they are actively reshaping its economic landscape, its cities, and its consumer behavior.
And yet, many Canadian businesses are still approaching this audience the wrong way.
They treat newcomers as a niche. They treat them as a translation problem. They treat them as a single, uniform segment.
All three assumptions are flawed.
Because the reality is this: Newcomers aren’t a niche; they are shaping Canada’s mainstream.
For retail brands and CPG companies, this isn’t just a diversity conversation. It’s a growth conversation. And for those who get it right, it’s one of the most significant untapped opportunities in the market today.
1. The Shift: Why Newcomers Matter More Than Ever
Let’s start with the data. Canada has one of the most ambitious immigration strategies in the world. In 2024 alone, Canada welcomed approximately 483,000-484,000 new permanent residents, one of the highest levels in its history.
But the bigger story isn’t just how many people are arriving, it’s what’s driving the country forward.
Immigration now accounts for over 97% of Canada’s population growth, making it the single largest contributor to the country’s expansion.
Nearly 1 in 4 people in Canada (about 23%) are first-generation immigrants, one of the highest shares among G7 nations.
In major urban markets, that number is even higher. Cities like Toronto and Vancouver are already majority immigrant or near-majority immigrant populations. This isn’t a future trend. It’s the current reality.
But the real story for businesses isn’t just population growth; it’s economic impact.
Newcomers:
Are entering the workforce rapidly
Are forming households at higher rates
Are driving incremental demand across grocery, household goods, and essential categories
Are often highly educated and upwardly mobile
Even with the federal government tightening temporary resident intake, especially through new international student limits, newcomers remain a strategically important growth market. In 2025, IRCC set a target of 437,000 study permits, down 10% from the 2024 cap, and Statistics Canada reported that Canada’s population growth slowed sharply in early 2025 as temporary and permanent immigration levels were reduced.
But this is not the same as saying newcomer demand has become marginal. Canada still admitted 483,640 permanent residents in 2024, and the 2025–2027 Immigration Levels Plan calls for 395,000 permanent resident admissions in 2025, with more than 40% expected to come from people already in Canada as students or workers transitioning into longer-term status. In other words, the pipeline is being recalibrated, not erased. For brands, that means the market remains large and economically relevant, and still reshaping mainstream demand, particularly because immigrants already represent nearly one-quarter of Canada’s population, and recent immigrants have been a major driver of both labour-force and population growth. For CPG and retail brands, this translates into something very specific:
New demand, new preferences, and new pathways to purchase at scale.
And importantly, these behaviours are not confined to “ethnic aisles” or specialty stores. They are increasingly shaping mainstream retail environments.
2. Where Businesses Are Getting It Wrong
Despite the scale of the opportunity, many brands are still stuck in outdated thinking.
Mistake #1: Treating Newcomers as One Segment
“Newcomers” is not a segment. It’s a label.
It includes:
Different countries of origin
Different languages
Different income levels
Different cultural norms
Different stages of acculturation
For example, the top source countries for newcomers to Canada include India, China, and the Philippines, but each group has distinct consumer behaviours, preferences, and brand expectations.
Yet many strategies still group them together under a single “multicultural” banner.
The result?
Generic messaging that resonates with no one.
Mistake #2: Treating It as a Language Problem
Language plays a critical role in marketing to newcomers.
It improves:
Message clarity
Accessibility
Initial engagement
In many cases, it’s the difference between being understood or ignored.
But high-performing brands don’t stop there.
Because language alone doesn’t drive conversion.
What ultimately influences purchase decisions is how well a brand aligns with:
Category expectations (e.g., food preferences, usage habits)
Shopping behaviors across channels
Trust signals within specific communities
Household decision dynamics
Perceptions of value and quality
Language supports communication.
Strategy drives performance.
The brands that win are the ones that integrate both using language to remove barriers, while aligning their marketing and product decisions to how different consumers actually shop.
Mistake #3: Underinvesting in the Opportunity
Many organizations still treat newcomer marketing as a side initiative rather than a core growth driver.
Budgets are limited. Efforts are fragmented. Measurement is unclear.
Meanwhile, the size and influence of this audience continues to grow.
Immigration levels have nearly doubled over the past two decades from roughly 250,000 annually in the early 2000s to over 400,000+ today.
There’s a widening gap between where the market is going and where brands are investing.
3. Understanding the Newcomer Shopper Journey
To unlock this opportunity, businesses need to rethink how newcomers actually engage with brands.Because their journey often looks different from the “traditional” Canadian shopper model.
Stage 1: Discovery Is Community-Driven
For many newcomers, discovery doesn’t start with advertising.
It starts with:
Family and friends
Cultural communities
Social platforms
Messaging apps
Word-of-mouth carries disproportionate weight. Trust is built socially before it’s built commercially.
Stage 2: Research Is Intensive and Intentional
Newcomers often spend more time researching products before making decisions.
Why?
Because they are:
Navigating unfamiliar brands
Comparing value across categories
Trying to minimize risk in a new environment
This leads to:
Higher reliance on reviews
Greater use of digital tools
Cross-channel behaviour (online to in-store and back again)
Stage 3: In-Store Is Still Critical
Despite digital engagement, physical retail plays a major role.
Stores are not just transactional spaces; they are learning environments.
Shoppers are:
· Exploring unfamiliar products
· Comparing formats and sizes
· Looking for cues they can trust
This is where merchandising, assortment, and in-store communication become critical.
Stage 4: Loyalty Is Earned Differently
Loyalty among newcomers can be incredibly strong but it’s not automatic.
It’s built through:
· Consistency
· Cultural relevance
· Positive early experiences
Brands that win early often become long-term staples.
Brands that miss the moment may not get a second chance.
4. What Newcomers Actually Value
If we move beyond assumptions, a clearer picture emerges of what drives decision-making.
1. Familiarity and Comfort
Newcomers often seek products that:
· Reflect home-country experiences
· Align with cultural preferences
· Provide a sense of familiarity
2. Value, But Not Just Price
Value is critical, especially in early settlement stages.
But value isn’t just about low cost.
It’s about:
Quality relative to price
Quantity and pack size
Versatility across meals or uses
3. Trust and Credibility
Trust is everything.
And it’s built through:
Peer recommendations
Consistent product experience
Clear, transparent communication
4. Representation and Relevance
Shoppers want to see themselves reflected, but authentically.
This includes:
Product assortment
Marketing imagery
In-store experiences
Surface-level representation isn’t enough. Relevance needs to be built into the full experience.
5. How Retail and CPG Brands Can Win
This is where strategy becomes execution.
1. Move from “Multicultural” to “Multisegment” Strategy
Instead of one broad approach, brands should identify:
Priority cultural segments
Key geographic clusters
Category-specific opportunities
2. Rethink Assortment and Merchandising
Growth isn’t just driven by marketing; it’s driven by what’s on the shelf.
Winning retailers:
Expand culturally relevant assortments
Integrate products into mainstream aisles
Use merchandising to guide discovery
3. Design for the Real Shopper Journey
Brands need to align with how newcomers shop:
Invest in digital research touchpoints
Ensure strong in-store navigation and clarity
Support cross-channel behaviour
4. Build Trust Early
The first purchase matters more than most brands realize.
Strategies to consider:
Trial-driving through promotions
Leveraging community influencers
Encouraging reviews and advocacy
5. Measure What Matters
Traditional metrics may not fully capture performance in this space.
Brands should consider:
Segment-specific growth
Basket composition changes
Regional performance
Repeat purchase rates among newcomer households
6. The Future: From Niche Strategy to Core Growth Driver
The trajectory is clear. As immigration continues to drive population growth, the influence of newcomers on Canada’s consumer landscape will only increase.
Canada’s foreign-born population already exceeds 8.4 million people, representing a massive and growing consumer base.
Over time:
Cultural preferences will further shape mainstream assortments
Retail environments will continue to evolve
The definition of the “average Canadian shopper” will shift
The brands that recognize this early and act on it will be the ones that lead.
The ones that don’t will find themselves constantly trying to catch up.
Where TerraNova Fits In
At TerraNova, we see this challenge and opportunity every day. Helping brands unlock growth in this space isn’t about translation. It’s about cultural intelligence applied to real business decisions.
It’s about:
Identifying where growth is coming from
Understanding how different consumers shop
Translating insight into actionable retail and CPG strategies
Because growth doesn’t come from recognizing change.
It comes from responding to it.
Final Thought
Newcomers are not a side segment. They are not a temporary trend. And they are not a simple marketing adjustment. They are a fundamental part of Canada’s economic and consumer future.
Newcomers aren’t a niche; they are shaping Canada’s mainstream.
The only real question for businesses is:
Are you treating them that way?
Let’s Talk
If your organization is looking to better understand and unlock growth with newcomer audiences, TerraNova can help.
From insight to execution, we work with retail and CPG brands to turn cultural understanding into measurable business impact.
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