This back-to-school season, let’s root for the procrastinators. For they may be the ones who make retail sales add up.
At this point in the back-to-school timeline, late-season shoppers can indeed be a retailer’s last hope to meet projections, which are modest to start with. Back-to-school spending is expected to decline by 10% in 2023, to $597 per child from $661 in 2022, according to a Deloitte’s 2023 back-to-school survey.
To pocket sales early, many retailers launched big back-to-school (BTS) sales in July to compete with Amazon Prime Day. That event, on July 11 and 12, generated a record-breaking $12.7 billion, according to Adobe Analytics. And sure enough, by early July, 55% of BTS shoppers said they’ve already begun fulfilling their lists, according to the National Retail Federation’s annual BTS survey.
But back-to-school shopping, just like December holiday shopping, is defined as much by last-minute spenders as early-birders. Indeed, the biggest retail deals are expected to run through August, DealNews reports.
Cliff Notes On Consumer Behavior: The 2023 Edition
The main factor shaping this year’s BTS season is soooo 2022: budget-eating inflation that just won’t go away. Back in 2022, the price of Sharpies rose by 55%, and Elmer’s Glue by 30%, CNN reported. Based on these surges, this year’s “deal” prices could well be equal to 2021’s full prices.
But retailers can be smart cookies. Here are a few ways they might cram last-minute sales into shopper baskets – even into September – based on the leading survey findings.
Show and tell why products matter. Nearly six in 10 parents are willing to splurge for the right reasons, Deloitte reports. By unpacking the elements that trigger splurge tendencies, retailers and brands can engage consumers willing to spend extra for the right reasons, such as nostalgia and self-expression. Cramming lesson: Retailers can create parent-appealing nostalgia in their displays, or borrow nostalgia from partner enterprises. There is a reason why more than 100 retailers and brands, including Bloomingdale’s, Kohl’s and Gap, have licensing agreements to sell Barbie-themed products timed with the release of the movie. Many items in the Gap’s Barbie collection, including a “Ken” T-shirt, had sold out by mid-July, CNBC reports.
Make elective items feel like requirements. Inflation is causing parents to focus on necessities, such as school supplies, and this could come at the expense of tech categories. But that risk can be managed with sub-category targeting. Consider this: Nearly 70% of respondents to the NRF survey plan to buy some electronics or computer-related accessories this year, up from 65% in 2022. The bump may be due to parents having put off such purchases in 2022, in hopes prices would come down (they didn’t). Cramming lesson: While parents say they will cut back on school apparel and tech spending by as much as 14%, according to Deloitte, these categories present the highest opportunities for splurge spending. So as first period approaches, retailers can underscore the urgent necessity of affordable tech.
Offer alma mater pricing. The prices of school supplies have risen by 23.7% in the past two years, according to Deloitte’s survey. Still, parents plan to spend 20% more on these essentials, including backpacks, art supplies and writing instruments. The difference between the 23.7% in price hikes and the 20% more parents are willing to spend suggests shoppers are likely doing extra homework to find the best deals. This is good for retailers, because homework takes time, and it could push some purchases to the last minute. Cramming lesson: Social media-inspired events, such as “throw-back prices” – a spin on the popular “throw-back Thursdays” theme – can attract BTS shoppers through opportunities to buy certain supplies at lowered prices on designated days.
Learn new delivery formulas. While most people (59%) said they will only shop retailers that offer free shipping, they are amenable to making a minimum purchase amount. In 2023, that amount is $32 – just below the $35 many retailers require. Free shipping is in fact why 58% of consumers pay for memberships in loyalty programs. Cramming lesson: By promoting reduced spending requirements for free shipping late in the season (“Last-minute offer!), retailers can clean out potential overstocks. Retailers also could compete by offering easier return options, as well, such as the curbside return service that Target, Walmart and Dick’s Sporting Goods already offer.
Don’t forget the ramen. Nearly 20 million students are estimated to attend college in 2023, and their families are expected to spend $1,367 per household, on average, compared with $1,199 in 2022, the NRF estimates. Furnishings and electronics will account for more than half of the increase in spending for college students – but so will essentials such as food. (Dorm room) cramming lesson: Displays of “complete dorm-room survival kits” that include lower-priced décor and go-to meals (ramen, granola bars, peanut butter and jelly), will have a good chance of capturing shopper interest. So would dorm room “all-nighter” sales that promote deep discounts from midnight to, say, 6 a.m.
Read The Play-Book Instructions
If retailers and brands can convince budget-conscious shoppers that their back-to-school offerings make economic and emotional sense (you can’t put a price on a child’s delight, right?), then they have a fighting chance of goosing up Deloitte’s conservative spending predictions.
Really, these approaches are copied from the same reliable chapters that retailers have long turned to in their playbooks: understand the customer’s needs and limitations, offer practical options, connect on an emotional level, make the occasional splurge feel rewarding.
In October (when kids are still asking for new back-to-school clothes), retailers will likely review their notes from this year’s playbook. Here’s hoping they get high marks.
This article originally appeared in Forbes.
