As always retailers have vied for the consumers’ attention by rolling out early promotions and luring the price-conscious consumers; and this year it seems to be no different with brands pushing Back-to-School (BTS) sales as early as possible. According to the National Retail Federation’s annual survey conducted by Prosper Insights and Analytics, the BTS spending for K-12 and college is expected to reach US $ 75.8 billion, up from last year’s US $ 68 billion as the average family is anticipated to spend more freely on school and college supplies this year.
Contrary to the earlier predictions, the average family with children in grades K-12 has completed almost half (48 per cent) of their shopping as of early August, slightly down from last year (50 per cent) as per NRF’s recent survey. “It is evident that many families are still considering price and value when shopping for their Back-to-School and college needs. Shopping early and often, is a trend we have seen from many budget-conscious consumers over the last few years. In the weeks ahead, parents will take advantage of the aggressive deals that retailers will offer as they get ready to welcome the Fall season merchandise,” confirms Matthew Shay, President and CEO, NRF. This year parents are expected to spend an average of US $ 673.57 on electronics, clothes and notebooks, compared with US $ 630.36 spent last year. In total, parents of kindergarten through 12th-grade students say they will spend US $ 27.3 billion on school supplies this year, up from US $ 18.4 billion in 2007.
To tap consumers, retailers are providing an array of products from a US $ 195 headband to a US $ 1 glue stick catering to all consumer segments. Such is the case that luxury brands like Kate Spade that are known for its luxury handbags are also offering gold-accented staplers, monogrammed planners and US $ 30 ballpoint pens to help raise sales during the increasingly important BTS shopping season. The discount retailer Dollar Tree is focusing on the other end of price spectrum by offering products such as a US $ 1 pack of tape, glue sticks and pencils rather than just fancy notebooks. A growing list of designer notebooks, luxury desk accessories and even beanbag chairs, catering to wealthy Back-to-School shoppers is quietly coming to power against the budget departmental store’s products. Now shoppers can buy a US $ 195 Gucci Headband, US $ 572 Versace backpack and US $ 28 Terez pencil case on the Saks website, while Restoration Hardware has a new teen line that includes US $ 2000 ‘riveted aluminium’ desk and US $ 250 faux fur beanbag chairs.
While Nordstrom stores are providing a mix of US $ 495 Burberry girl’s cross body bag, US $ 32 backpack and a set of US $ 17 gel pens, traditional retailers catering to the middle-class consumers are struggling to slash prices in this aggressive race vying for consumers. Sales at many such stores have slumped and once-famous retailers such as Macy’s and Sears have had to shut down their stores.
Nonetheless BTS items are also expected to buoy sales at discount retailers such as T.J. Maxx, whose appeal is increasingly wide and which aims at the growing number of poor students and families in the US. According to the Department of Education’s National Center for Education Statistics, in 2007 around 9 million public school students came from low-income households and in 2014 there were more than 11 million. In order to tap in more consumers, these discount retailers have pushed their promotions earlier in the season that has in turn pushed people to research more about the products. According to the recent data released by Google, BTS search queries rose sharply in the week of July 11, a full week earlier than last year. Others such as Walmart, the world’s largest retailer, have used tax-free holidays to encourage shopping of school-related items.
According to NRF’s recent survey:
• Families with children in grades K-12, plan to spend an average US $ 673.57 on apparel and accessories, electronics, shoes and school supplies, up from last year’s US $ 630.36 for a total of US $ 27.3 billion.
• Consumer confidence in the economy continues to grow and is a significant factor in how families, will spend for Back-to-School this year.
• College students and families with children in college plan to spend an average of US $ 888.71
• Similar to K-12, 30 per cent of college consumers say the economy will not affect their shopping plans, up from 26 per cent and the highest level in the survey’s history.
Most importantly, many retailers are promoting uniforms heavily with retailers such as Target promoting 50 per cent off-prices on the uniforms. “Our people said that whether its Burlington or Target or JCPenney or Sears, the uniform section was the hottest part of the competitive space for Back-to-School. About twice as many stores this year as last are doing specials on uniforms,” reveals Craig Johnson, President, Customer Growth Partners, a retail consulting group.
With retailers offering an assortment of products and strategizing it in the best way to vie for the consumers attention, each retailer whether discount, luxury or mid-segment are trying their best to offer the best to its consumers so that they not only visit the store but also convert it into a sale. As Back-to-School season is the second biggest shopping period of the year behind Christmas, while families will spend more than before; how they will do it and where they will do it, remains to be seen.
