The back-to-school shopping period already has begun, but it typically peaks in the first two weeks of August, and those are close upon us. Fully two-thirds of consumers will be spending on back-to-school and back-to-college items in the first half of next month.
The back-to-school shopping season generated $84 billion in sales last year, and research firm Coresight expects spending to rise by 3% to 4% this year. The National Retail Federation (NRF) has forecast a slight decline to $82.8 billion.
Coresight sees positive economic indicators such as lower unemployment, still-high consumer sentiment, improved consumer spending, higher wages, and more tax-free shopping days. Negative indicators are gas prices and the impact of increases in home improvement sales that don’t count in back-to-school sales.
Nearly a third of consumers surveyed by Coresight (31.5%) plan to spend more this year than they spent last year, and more than half (53.1%) plan to spend the same amount.
One category will suffer, however. Apparel, traditionally the largest spending category for the season, is seeing a “de-prioritization” this year. On a per-household basis, NRF has forecast spending to decline from $688 last year to $685 this year, divided among apparel (35%), electronics (27%), shoes (20%) and school supplies (18%).
Back-to-college spending is forecast to focus most heavily on electronics (27%), clothing (16%) and furnishings (12%). College students are expected to spend $229 per household on electronics, $153 on clothes and $109 on dorm and apartment furnishings.
Consumers plan to purchase items at department stores (57.2%), online (55.4%), discount stores (52.4%) and clothing stores (50.7%).
As always, consumers are determined to find discounts, fueling competition among retailers and forcing them to focus more on convenience, according to Coresight.
For retailers with the right products in the right place at the right price, the back-to-school season should yield good results this year.