Let’s Hope Retailers Have Ordered A Lot Of Erasers
Back to-school season is upon us, and parents are learning a lot about the science of prediction. The shifting sentiments that come with it should cause retailers to exercise new actions when it comes to building the right customer experiences.
For one thing, exactly where and when will school start? Nearly 70% of parents do not intend to begin school shopping until three weeks before classes are scheduled to start, because they don’t know what to expect, according to research by the National Retail Federation (NRF).
Not that they won’t spend when they feel ready. The NRF survey indicates parents of pre-K to high school students will spend more on back-to-school items this year – nearly $790 on average compared with $697 in 2019. That adds up to $33.9 billion, from $26.2 billion in 2019.
However, this doesn’t necessarily mean all retailers will record a seasonal sales gain, though it could present a fresh opportunity for certain retail sectors. An exploration of some of the research results regarding school spending reveals why.
2+2 Adds Up Differently Across Households
Because states and communities are enforcing varying guidelines on schooling, a single retailer can find it is marketing to dozens of sharply different needs. These six findings speak to those anticipated needs, which some retailers are already acing.
- Uncertainty’s learning curve. As of mid-July, more than half of parents had not finished their back-to-school shopping because they don’t know what to expect. This is why 68% are waiting until three weeks before school starts to even start. Many retailers and brands are offering competitive promotions, but the ones that show they understand the turmoil behind the shopping trip will stand out. Backpack brand JanSport is proving it identifies with the stress factor through a campaign called “Lighten the Load,” which promotes mental health wellness among young people managing in the pandemic.
- The price of being a teacher. It’s likely a lot of spending on back-to-school supplies is shifting from teachers to parents as more kids learn from home. Indeed, parents expect to spend about $10.4 billion just online for back-to-school supplies, up 28.4% from last year’s $8.1 billion, according to the 2020 Deloitte back-to-school survey. The NRF survey indicates spending for basics such as pencils, paper and other supplies will climb to $131 from $117 (up 13%). Retailers could benefit by sharing with parents what they know about how teachers shop.Staples, Amazon AMZN +0.9% and Walmart WMT +0.2% are among retailers marketing pencils, Sharpies and notepads in bulk, for example. Or retailers can learn from Bags in Bulk, which sells a complete 45-piece school supply kit.
- Big-ticket items compute. Computers will be a big contributor to back-to-school spending this year – 63% of parents plan to buy laptops and other electronics, the NRF survey shows. (Of parents who expect their kids to learn at home, 72% plan to buy computers and home furnishings.) A computer purchase often requires research, and retailers that provide that service will probably click with shoppers. Best Buy BBY +0.6%’s online Student Hub helps customers shop “new tech for a new way to school,” with an online questionnaire – which includes “what’s your style?” questions – to determine needs and preferences before offering suggestions.
- The pandemic is adding to traditions. Untraditional purchases, such as safety supplies (masks, sanitizers and gloves), also are nabbing part of the traditional back-to-school budget. Nearly 90% of parents will purchase safety products, according to a PayPal -0.4%PYPL survey, and 59% will invest in remote learning technology. Ace Hardware, not a traditional destination for back-to-school shopping, is taking advantage with push emails that promote “health and safety essentials” (masks, gloves, disinfectants) and a $5 coupon. It also is sending tips on setting up, and cleaning, a home classroom.
- Home-schooling changes fashion. Apparel spending is predicted to decline – by 10% year-over-year based on Deloitte’s survey, though the NRF projects a more modest 2% decline. Parents may spend more, however, if they see clothing ideas that anticipate any environment. Macy’s M +3.1% is kicking off the shopping season with the upbeat campaign, “No matter how we school, let’s be ready,” which offers clothing and accessory suggestions so customers can “be ready” in ways that matter now – from “for any kind of classroom,” to “with max confidence” to “for every chill and study sesh.”
- Stores will be history. Not completely, but the accelerated shift toward e-commerce, launched in the spring, will continue. More than half of parents (55%) told the NRF they plan to shop online, compared with 49% in 2019. Just 36% of shoppers plan to visit discount stores, compared with 50% in 2019, and 37% expect to go to department stores, from 53% a year ago. Retailers that want to entice back-to-school shoppers into the stores must find ways to make the experience unique and helpful. There’s a reason Amazon Prime AMZN +0.9% in March counted 118 million members (compared with 109 million a year before). Its “ready for school” site covers all the categories, including snacks and cable modems, in one click.
New Schooling Means New Calculations
This school year will be a case study in perseverance – and creativity – for every party involved, from the brands that make the goods retailers sell to the students who use them. So far, many in the retail industry have proven they can adapt quickly.
Those that make history will likely be the ones that see the schooling challenge through the eyes of parents and students, to encompass all concerns from safety to job security to style, rather than through corporate performance measures.
It’s a pretty simple lesson, and it hasn’t changed in generations: If shoppers feel they are cared for, they will come.
Bryan Pearson is a Featured Contributor to The Wise Marketer and currently serves as a director and strategic advisor to a number of loyalty-related organizations. He is the former CEO of LoyaltyOne.