August 10, 2020

Back-To-School By The Numbers

Pankaj Mathur - Vice President, Sales
Back-To-School By The Numbers

Did you know back-to-school shopping is the third highest-grossing sales event in the U.S.? Bested only by Black Friday and Cyber Monday. A total of $80 billion is spent averaging approximately $700 per household[1] and even during the COVID-19 pandemic, with the school year clouded with uncertainty, back-to-school sales could hit a record $100 billion.[2] Unlike Black Friday and Cyber Monday, back-to-school sales span across a few weeks, giving retailers more time to engage and convert their target audience.

Typically, parents, children, and teachers spend the last precious weeks of summer trying to enjoy the end of the season while also preparing for the fall school season. However, in the midst of the COVID-19 pandemic, there’s a lot of uncertainty surrounding this year’s back-to-school season. Brick and mortar stores that would usually see a boom during August and September have instead registered a 30% reduction in foot traffic.[3] And while this is an unprecedented shopping season, marketers can still look at past behavior to help them inform their campaigns. Let’s examine how consumers have typically behaved during back-to-school.

Who are the big spenders?

Consumer spenders include moms, dads, grandparents, teens, young adults, teachers, nearly anyone who is going back-to-school or has a child, grandchild, brother, sister who is going back to school. While the average spend is $700 per household, the pattern of spend is interesting. The NRF estimated the average 2019 back-to-school spends[4]:

  • Teachers – on average spend $500
  • Parents & guardians – on average spend $700 per household
  • Pre-teens – on average spend $27 of their own money
  • Teens – on average spend $37 of their own money

What are they buying?

The NRF states that “a quarter of all US households send their children back with brand new supplies, clothing, accessories and gadgets.[5]” So, what has the breakdown of spend on each of these categories been historically?

  • School supplies – $120
  • Shoes – $136
  • Clothing and accessories – $240
  • Electronics – $205
  • College Freshman – the list is much longer including:
    • Dorm room supplies – cleaning supplies, laundry detergent, bowls, utensils, etc.
    • Food – easy mac, granola bars, etc.
    • Transportation – car, airline tickets, bus fare, gas money, etc.
    • Furniture and appliances – refrigerator, microwave, toaster, bedding, towels, etc.
    • Collegiate Gear – new clothing with college logo

How 2020 spending might look

Because of the pandemic, 2020 back-to-school spending is shaping up to look different than it’s been in past years. Spend on clothing and accessories has dropped by 10 percentage points and spend on school supplies is down 13 percentage points. However, consumers are still spending. Spend on computers and electronics is up by 38 percentage points and 4 percentage points, respectively.[6] The probability of virtual learning is driving these changes in consumer spending habits. Although spending in certain categories has decreased, consumers are still buying. For marketers to succeed in 2020, they need to adapt to the new reality and develop both products and campaigns that better resonate with their audiences’ needs. For example, a retailer which has previously relied on backpacks and back-to-school apparel to increase revenue during this season can market a comfort-forward home line that meets the needs of those who will be learning online – from loungewear and a fresh ‘home classroom’ décor, to board games and fun desk accessories, back-to-school may look different but there is still plenty of opportunity for brands to grow revenue.

When do consumers start shopping?

  • Many consumers plan their shopping around sale events and free shipping (for online purchases). Last year, 59% of Americans[7] did their back-to-school shopping during Amazon Prime Day. Although many indicated that they were waiting for sales, or instruction from their child’s school.

  • In 2020, the uncertainty around the upcoming school year means consumers have been putting off back-to-school shopping, with analysts predicting consumers will wait until August before they start to purchase. Brands are cutting back on their back-to-school campaigns as well. July back-to-school sales campaigns experienced a 93% decline between June 1 and July 22, compared with the same period last year.[8] Savvy brands can still capture consumers back-to-school spending dollars by delaying their campaigns to match this new consumer behavior.

Where are they buying?

In a typical year, brick and mortar department stores are where consumers are buying. Many schools have partnered with these department stores to have their back-to-school checklist easily accessible in their stores. However, online shopping is more convenient, and many buyers take advantage of the free shipping. The NRF[9] reported that parents are saying online shopping takes away from the “school shopping experience.”2020 is an outlier. As a result of the pandemic, online sales shot up 76% in June, as shoppers prioritize safety over the in-store shopping experience.[10] To address this shift in behavior and condition consumers to shop online for their products, brands need a digital-forward marketing and e-commerce strategy that streamlines the online shopping experience and offers attractive deals such as free shipping or BOGO.

What are the key drivers of consumers’ purchase behavior for back-to-school?

Deloitte[11] tells us that convenience matters. Consumers are influenced by these four things:

  1. Price – In Deloitte’s recent holiday study, 74 percent of the respondents said that price discounts were the most appealing offer by retailers.[12] In 2020, price is more important than ever as an unstable economy has made parents more budget conscious. Make sure the price is competitive, so consumers don’t choose your competition or wait until an item goes on sale.
  2. Product – Consumers have an abundance of choice, when it comes to back-to-school products. A study by FirstInsight found that 53% of consumers believe quality is more important than price.[13] As schools struggle to balance virtual and in-classroom learning, shoppers need products that are durable, multi-purpose and can be used both in the classroom or at home.
  3. Convenience – A survey by the NRF found that 83% of shoppers say that convenience while shopping is more important today than it was 5 years ago.[14] Making your product accessible and easy to obtain is a must, especially in 2020 when consumers have limited in-store shopping options.
  4. Safety & Social Distancing – this is new in the COVID era and retailers need to take the safety of their customers and employees very seriously. Large brands, such as Walmart, Home Depot and Lowes are setting the tone for the industry as they require anyone entering their stores to wear a mask.[15]

Who should you target? 

None of the techniques listed below will have any impact unless your company knows their digital audience. COVID-19 has changed the game for retailers. There have been demographic shifts in who is actually doing the shopping.[16] While women are usually the buyers for the household, men are shopping more and are more likely to go for the best deal than remain loyal to a brand.[17] Consumers who might not have worried about their budgets before, are tightening their belts and looking for greater value.

If you do not have demographic attributes for your current customer and prospect lists, you can expand your knowledge of your audience through demographic data from reputable 3rd party data providers, such as Infogroup, who can help you target your most high-value prospects. Infogroup has audiences specifically for back-to-school season.

Where should you advertise?

Products that consumers would normally grab at a brick and mortar store are now being ordered online. Brands need to tighten their digital marketing strategy in order to maximize their market share.

  • Display ads & social media marketing

Display ads and social media marketing are always recommended as a great place to start your back-to-school promotions. In fact, HubSpot reports that 84% of marketers were able to generate increased traffic with as little as six hours of effort spent on social media per week.[18]

Retail’s heaviest hitters, such as Amazon, Walmart, Macy’s and Staples will all be running creative back-to-school campaigns designed to catch their target audience’s attention with promises of quality products at a fair price.

Brand Example: Jansport Offers to #lightentheload

Many parents and teachers are worried about the effects of virtual learning on the mental wellbeing of children and teens. The potential loneliness and isolation under virtual learning is something that cannot be ignored. For their 2020 back-to-school campaign, apparel company Jansport launched their #lightentheload campaign. Jansport featured real stories of real teens and their struggles with mental health. Jansport sent production kits to real customers and compiled a video that they have uploaded to Youtube and shared on their social media channels. The campaign also includes sessions with therapists held over Instagram Live.

  • Email Marketing – Email is a proven revenue-generator that can drive more than 50 times its return on investment. Make sure to promote your sales offerings ahead of time. Use catchy subject lines such as “20% off back-to-school items” or “Free Shipping!” to grab the attention of your audience. Smart, performance-driven email design is the best way to engage potential customers.

Brand Example: TOMS Multi-Generational Approach

For their back-to-school campaign, California-based shoe company TOMS sent an eye-catching email with products for every age – from preschool to college. The email has an “S” layout to help guide viewers’ eyes down the email and products are divided by age group so that the reader could select which education level applies to them and quickly find what they need.

 

 

 

 

How do you stand out from the competition?

  • Convenience –Any brand offering a convenient and easy experience for harried parents and school teachers will have an edge over the competition. Consider offering delivery, curbside pickup, fast shipping, etc.

Brand Example: Target’s ‘Study from Home’ Delivery & Pick-up Options

Retail giant, Target, has an entire webpage devoted to back-to-school supplies for students who will be studying virtually this fall. Not only does Target tout their sales and breadth of products on this page, but they stress the safety and convenience of ordering with Target.[19] For consumers who want their order now, they can drive to their local store and have Target employees load their order directly into their trunk. Target is also offering same-day delivery, for customers who don’t have time to jump in the car. Many parents are working from home and watching their children all day, and same-day delivery is the ultimate convenience for them. Target, who is in close competition with other big-box retailers, might be able to edge out the competition by offering quick, convenient and contactless shopping options.

  • Think outside the box – Stand out from the crowd by offering services your competitors might not think to offer. Such as free installations and extended warranties. Consider highlighting safety and social distancing in your creatives as well.

Brand Example: Dick’s Sporting Goods Backpack Selector

Dick’s Sporting Goods started their back-to-school campaigns in July last year. But, one thing in particular that stood out from their normal promotions was the Backpack Selector module. The Backpack Selector is a quiz for the consumer to take to find the best backpack for them, taking some of the guesswork and anxiety over picking the best backpack for kids.

 

 

 

 

  • Personalization – More consumers than ever before have indicated that personalized messaging is crucial in marketing communications. In fact, almost half are willing to switch to brands that personalize their messaging. When it comes to back-to-school, for example, teachers might want ads focused on school supplies while teenagers want to see electronics, shoes, and clothing. This means having the right segments, with custom messaging, communicated in the most appropriate channel for that segment, is key to running a successful back-to-school campaign.

Click here for a suggested list of audiences for back-to-school. If you have any specific need(s) or have other ideas, feel free to email us.

 

 

 

 

 

 

[1] https://nrf.com/media-center/press-releases/record-spending-expected-school-and-college-supplies

[2] https://www.cnn.com/2020/07/15/business/back-to-school-shopping-pandemic/index.html

[3] https://www.glossy.co/fashion/citing-high-e-commerce-sales-and-low-foot-traffic-many-dtc-brands-wont-reopen-in-nyc-today

[4]  https://www.businessinsider.com/gofundme-clearthelists-campaign-helps-teachers-pay-for-school-supplies-2019-8

[5] https://nrf.com/media-center/press-releases/record-spending-expected-school-and-college-supplies

[6] https://www2.deloitte.com/us/en/insights/industry/retail-distribution/back-to-school-survey.html

[7] https://www2.deloitte.com/content/dam/Deloitte/us/Documents/consumer-business/us-retail-industry-outlook-2020-final-100720.pdf

[8] https://www.mediapost.com/publications/article/354240/what-back-to-school-shopping-looks-like-this-year.html

[9] https://nrf.com/insights/retail-holiday-and-seasonal-trends

[10] https://www.digitalcommerce360.com/article/coronavirus-impact-online-retail/

[11] https://www2.deloitte.com/content/dam/Deloitte/us/Documents/consumer-business/us-retail-industry-outlook-2020-final-100720.pdf

[12] https://www2.deloitte.com/us/en/insights/industry/retail-distribution/holiday-retail-sales-consumer-survey.html

[13] https://www.firstinsight.com/press-releases/quality-more-important-than-price-study

[14] https://www.marketingcharts.com/industries/retail-and-e-commerce-111664

[15] https://www.cnn.com/2020/07/24/business/masks-walmart-home-depot-lowes-cvs/index.html

[16] https://www.uschamber.com/co/good-company/launch-pad/changes-in-consumer-buying-after-coronavirus-pandemic

[17] https://lifestylemonitor.cottoninc.com/men-women-brand-loyalty/

[18] https://blog.hubspot.com/marketing/social-media-roi-stats

[19] https://www.target.com/c/at-home-learning/-/N-wiae5?Nao=0