- Comparing 2018 back 2 school projections with 2017 - 2016
- Back-to-school season: opportunities for retailers
- Top tips for back-to-school marketing campaigns
Retailers with products or services aimed at K-12 children are entering the second busiest shopping season of the year. In 2017, the Field Agent Back-to-School Report predicted that spending last year would be around $27 billion.
In this year’s report, the National Retail Federation is projecting $30 billion of spending on school essentials. If you factor in back-to-college (including those going to college as a fresher) spending, this retail season is worth around $84 billion. Now we are through the first half of 2018, this is the start of the most competitive period for retailers, with Black Friday and Cyber Monday on the horizon, followed by the madness of holiday season retail.
The BTS season should be getting into full swing. Field Agent interviewed 1,001 mothers with children in the K-12 school age groups. In this article, we outline what they are predicting and how this compares to last year, plus some valuable tips for US retailers.
Comparing 2018 back 2 school projections with 2017 - 2016
- In 2016, the BTS report was expecting parents to spend $25 billion. Similar to Black Friday and Cyber Monday, that figure has been moving upwards recently, with $27 billion spent in 2017 and projections of $30 billion in 2018.
- Two years ago, a considerable number of parents - 24% Strongly Agree and 53% Agree that BTS spending “is a strain on my personal budget”, with those figures going up in 2017: 25% strongly agreed and 57% agreed with that statement. Field Agent reduced the number of options to answer that question in 2018; however, with 80% agreeing with that statement it shows how much price and bargain hunting plays an important and consistent influence on what parents spend.
- Online spending has been gradually increasing since 2016. Two years ago, 64% of parents said they would buy some supplies online, increasing to 72% in 2017 and now 74%.
- In 2018, Amazon is expecting to be the third most popular retailer for BTS supplies, with 57% of parents expecting to turn to them for necessities. Walmart (91%) and Target (65%) are the two market leaders, with Dollar Tree, Dollar General, Staples, Walgreens and Office Depot popular choices, although far behind the market leaders. These figures are similar to 2017 - 16, with Amazon taking a larger percentage of market share from other retailers.
- Increasingly popular and convenient for busy parents are omni-channel methods, with more than ever favouring the following: Order online, pickup in-store (52% in 2018 vs 42% in 2017); App-based ordering (41% vs 39%); curbside pickup (24% vs 18%) and ordering using voice-apps, such as Amazon Echo (now up to 12% of parents).
- The majority of parents will visit between two and five stores for school supplies. Including this year, responses to three years worth of surveys show that around 85% of parents shop in up to five brick-and-mortar stores during BTS season.
- Top product categories - (few changes from 2017-16) - include the following: Basic supplies (e.g. stationary); clothes; footwear; hygiene products (e.g. sanitizer, tissues); backpacks; food; electronics; sports gear; and medication and vitamins.
- Based on Deloitte’s 2017 BTS survey, parents spent around $532 on average, up from $501 in 2016. This year’s report is not yet published, although we can anticipate another annual increase, with potentially $6 billion - or more - of spending undecided, since around 20% of parents don't know where they are going to buy supplies.
Back-to-school season: opportunities for retailers
Parents want to find what they want quickly and easily. For some parents, the BTS experience is a chance to spend quality time with their children, which means they enjoy taking them to several stores. It is a tradition, and one that retailers can encourage, putting on in-store sales and events that encourage parents with children to stay longer and spend more.
At the same time, more parents want the speed and convenience of online shopping. Or as we are increasingly seeing, online purchases with in-store or other forms of omni-channel delivery and pickup.
Something retailers should be well aware of is the influence of price. Budget has a huge influence on where and when parents buy BTS supplies. Plus, the date children go back to school means in some states purchases happen later into August, or they're timed around tax-free shopping seasons in the state of residence or nearby state. In the Field Agent report, 56% of parents will make some purchases during tax holiday seasons, up from 54% in the 2017 report.
Price is more important now than ever. In 2016 and 2017, 55% of parents ranked price as the highest priority when they bought BTS supplies. Now 59% rank price as the most important factor, with quality taking a hit, down to 26% from 38% in 2016. In comparison, only 2% are loyal to particular brands or retailers, or shop somewhere out of habit.
Top tips for back-to-school marketing campaigns
With 80% of parents saying shopping for a new school year puts a strain on their budgets and 59% picking retailers according to price, this is information you can’t ignore.
Your customers are price sensitive. If you don't adjust and prepare accordingly they're going to shop elsewhere, even if they're good customers the rest of the year.
Here are a few back-to-school marketing ideas we recommend retailers use during this shopping season:
- Get stock ready. Review what sold well last year, current year-on-year trends, best sellers in the store, region and state, and what customers are buying online compared to a year ago. Keep a close eye on what is actually happening compared to trends and predictions, to avoid over or under stocking for what customers need.
- Keep prices competitive. Flash sales, discounts, regional promos and other special offers are going to keep a retailer ahead of rivals. Knowing what competitors are charging (online and offline, in and out of the state), with a clear view of margins and volumes will ensure you are agile, flexible and responsive to changing customer needs and price sensitivities
- Run proactive promos. If you aren't running a promo of some kind, customers might assume you’re charging full price and will shop elsewhere. Adjust your back to school advertising strategy to engage your most loyal customers: Send emails, text and remarketing adverts online and across social networks. Reach your BTS customers across every channel, advertising current deals and regional promotions.
Parents rarely enjoy back-to-school season shopping. It is an expensive necessity, so make it easy for them to spend as much of their BTS budget with you. Run promos and offers, keep prices consistently competitive and promote a convenient multi-channel experience, whether they're bargain hunting on a smartphone or visiting five stores in a single day and are keen to get the shopping over with.
How you perform during this promotional period is a useful test-run for Black Friday, Cyber Monday and the competitive build up to the Holiday Season. Get your intelligent and responsive pricing strategy worked out now and you could be onto a winner during the busiest retail season of the year, after back-to-school is over.