Back-to-School is in Session
For kids, the coming of August marks the dreaded end of summer; but for retail, it is a welcome windfall as Back-to-School (BTS) shopping reaches its peak. Second only to Holiday in overall revenue, the total combined spending for K-12 and college BTS in 2017 is expected to reach upwards of $83.6 billion–an increase of 17% from 2016. To maximize impact and get the most out of this critical season, it is important for retailers to consider key market trends and tactics.
BE THE EARLY BIRD
BTS has traditionally spanned from late July to end of September, with peak sales occurring in mid-August. However, an increase in early shopping over the past few years has pulled back the start of the season. Many retailers are now setting BTS in early July, and there is evidence they will benefit from a greater portion of sales. Consumer surveys from National Retail Federation and Deloitte have found shoppers who hit stores before August are likely to spend an average of 16% more than those who start shopping later—a significant amount when the average total spend per child exceeds $500. Southern shoppers in particular tend to tackle their BTS shopping lists early, and this region alone accounts for 44% of all BTS spending.
CATER TO NEW CONSUMERS
Though parents ultimately hold the pocketbooks, the power of the younger generation should not be underestimated. According to NRF’s 2017 survey, 65% of BTS shoppers claim their children directly influence a majority of their purchase decisions. It is therefore critical for retailers to adapt their selling strategies to attract the tech-obsessed, experience-seeking members of Generation Z. Create a “pop-up” store for school supplies. Experiment with creative, Instagram-able P.O.P. displays. If a celebrity endorses your brand, ask them to make an exclusive in-store appearance. The BTS shopping season provides retailers an invaluable opportunity to learn about the habits and preferences of young consumers in order to prepare for the shopping experiences of tomorrow.
REALIZE UNTAPPED POTENTIAL
While traditional, in-store shopping will continue to dominate over online BTS sales in 2017, consumer venue preference is shifting away from department stores and specialty boutiques toward mass merchants and budget retailers. A critical opportunity exists in the form of undecided shoppers, who make up an estimated 1/5 of all consumers and represent $5.4 billion in untapped revenue. Creating an exciting shopping experience and improving integration of digital and in-store (convenient buy online/store pickup services; easy site navigation; engaging social media campaigns, etc.) can help retailers sway these undecideds and foster customer loyalty beyond the BTS season.
LEARN FROM EXPERIENCE
As a long shopping season with predictable merchandise categories, BTS presents a useful opportunity for retailers to track outcomes and determine whether their marketing strategies work or require improvement. What areas are generating store traffic? What communication channels are generating the most customer response? This feedback not only allows retailers to better position themselves for BTS 2018, but also provides valuable insights to consider when preparing for Holiday.