Get ready for another bump in back-to-school shopping
If you’ve been an eSeller for any length of time, you know that the back-to-school shopping season is a tremendous opportunity to attract new customers and drive revenue. Outside of major holidays, this is one of the busiest shopping times of the year. Conversely, if you’ve never developed a strategy to target consumers during this period, now is the time to get in on the action.
To achieve the results you want, it’s important to plan ahead and look at anticipated behaviors for the upcoming season. There’s ample data available that provides insights on what consumers plan to buy, when they plan to buy it, and what motivates their purchasing decisions. The following is a look at expectations, data, strategies, and tips to help you prepare a successful back-to-school plan.
Record sales expected
In 2016, US retailers generated a record high level of sales during the back-to-school shopping season. It’s projected that this year, consumers will push that record even higher with a 4% increase in total spending. That would make a whopping $857 billion in total retail sales just during the months of July in August. This number doesn’t even include money spent on in the travel and event sectors.
Categories of interest
Beyond just recognizing the massive revenue-generating potential in front of you as an eCommerce provider, it’s important that you plan your stock or offerings according to product categories that get the most interest. Naturally, this means loading up on school equipment, gear, supplies, clothes, accessories and more.
Five specific product areas with heavy back-to-school concentration produced $32.44 billion of last year’s July and August retail sales. They were:
- Apparel and accessories
- Entertainment (books, music, video)
- Computers and electronics
- Office equipment and supplies
- Toys and hobbies
Buying in these categories alone is expected to grow by 15.8% this year, according to eMarketer. When you include college students, the National Retail Federation projects $83.6 billion in school-centered buying activity. Thus, whether you are a general merchandiser provider that needs to focus on each of these opportunities or a specialist that needs to gear up in your niche areas, it’s important to plan ahead.
The NRF, in its annual Back-to-School Spending Survey, was able to dig a bit deeper to find more data on the types of retailers and product categories in which consumers anticipate spending the most money. Nearly half, 45.5 percent of respondents (not shown in the graph below), indicated an intent to make purchases online. This data means that nearly $40 billion of the combined $83.6 billion in projected spending will occur through e-commerce providers.
The fact that 46% of respondents said they play to shop at clothing stores reveals that this is one of the high-spend areas that typical eSellers can leverage in ramping up for the season. Office supply stores, at 35.6%, and electronics stores, at 24.6%, are other retailer categories of high interest.
Timing of back-to-school spending
Understanding the timing of when consumers make their school purchases is at least as important as knowing what they buy. This awareness helps you better plan appropriately inventory levels, on-site merchandising and layout, and promotional strategies.
From a general perspective, the heaviest concentration of K-12 purchasing activity takes place between 3 weeks and 1 month before school starts, according to the NRF. Forty-six percent of survey respondents reported that this was their intended time to shop. Another 21% indicated a plan to buy just 1 to 2 weeks in advance. Thus, 67% of all activity will take place in the final month before school. The early crowd, which gets in a couple months ahead of school, includes 27.1% of consumers. Purchasing continues even after school starts, with 5.2% planning to get supplies the week of or week after doors open to students.
If you plan to compete in the back-to-school college space, much of the buying activity for dorm furnishings takes place in August. Office and home furniture are high-price investments typically made for dorms. Additionally, students need cleaning supplies and desk supplies like computer and laptop accessories, organizers, binders, notebooks and writing utensils. If you offer textbooks, the majority of students buy them between mid-August and the start of September. An increasing number of shoppers prefer to look online to find better prices than they typically see in on-campus bookstores.
The “discount crowd”
One advantage of attracting customers early is that they are more willing to pay regular price for back-to-school items. Shoppers that wait until late August, and even early September, are more likely ingrained with the mindset of waiting for late-season discounts.
As you look to clear out excess inventory or drive more revenue in the latter part of the season, you will likely have to offer steep discounts. Consumers tend to continue buying clothing for the year well into the fall, so you can often wait to discount apparel and accessories until late September or October.
Free shipping is one of the simplest promotions to offer that entices customers yet helps you maintain strong gross profit margins. The NRF asked consumers which types of promotional offers they plan to take advantage of this season, and 90.5% indicated a desire for free shipping on their orders. Offering expedited shipping may also help you beat out competitors, with 14.1% of consumers noting a desire to receive items in a hurry.
The ability to anticipate the behavior of your customers in advance of its occurrence gives eSellers a major advantage. With nearly half of all spending this year expected to take place online, now is the time to ensure you have plenty of product available, and that you are taking steps to promote your offerings through digital marketing strategies such as blog posts, email, social media, display and paid search advertising.