Retailers should brace for strong back-to-school sales according to a National Retail Federation survey that shows a surge in K-through-12 and college spending.
Total spending this year is projected to increase 21.7% to $83.8 billion with spending in the larger back-to-college market growing at about half the pace of the smaller K-through-12 market. Total spending related to K-through-12 students is expected to increase 32.9% to $30.1 billion from $22.8 billion last year, while back-to-college spending is forecast to increase 16.3% to $53.5 billion from $46 billion last year.
Although far fewer kids head of to college each fall than enroll in K-through-12, the sales figures for back-to-college are substantially higher than the K-through-12 figure because college kids have a wider range of needs. Accordingly, NRF asks about spending intentions across a broader range of categories. For example, in addition to the apparel, footwear, supplies and electronics needs of the K-through-12 students, those heading back to college are also asked about spending intentions related to gift cards, personal care, food, licensed products and home goods to furnish a dorm or apartment.
The expectations of an exceptionally strong back-to-school season conflict with otherwise dour economic reports about the state of a still struggling U.S. economy and widespread uncertainty around the trajectory of a presumed rebound.
“When it comes to their children, there’s nothing more important to a parent than making sure their children have everything they need, even in a tough economy -- and especially when it comes to back-to-school shopping,” said NRF president and CEO Matthew Shay. “Backpacks rip, pencils break, and children grow, there’s no way around it, but as they begin tackling their shopping lists, parents will make sure to spend smarter than they ever have before. We fully expect retailers to be aggressive with their promotions both in-store and online, keeping an eye on inventory levels as families look to spread out their shopping throughout the entire summer.”
Back-to-school season begins almost as soon as the school year ends. New merchandise hits stores in June and promotional efforts begin in July, which is when NRF began asking shoppers about their intentions. The trade group retained research firm BIGinsight to conduct the survey of 8,509 people from July 2 to 9.The study provides insight into how much consumers plan to spend, where they plan to shop and what they plan to buy.
This year’s results show that those with kids in K-through-12 plan to purchase products at discount stores (67.1%), department stores (59.9%), clothing stores (52%), office stores (42%), electronic stores (26.3%) and drug stores (22.7%). Forty two percent of those survey said they would shop online.
The mix of retailers for college kids looks a lot different for college kids due to the type of products they buy. For example, discount and department stores are much less important, while college bookstores are understandably mentioned by 40.9% of people as a spending destination. In addition, college students and their families will also head to discount stores (51.9%), department stores (45.4%), office supplies stores (40.3%), clothing stores (34.8%), drug stores (22.3%), electronics stores (21.1%), home furnishings stores (11.2%) and thrift stores (15%).
The mix of spending for those in K-through-12 skews heavily toward clothes and shoes, according to the survey. Parents estimated they will spend an average of $375 on clothes and shoes followed by $217.88 on electronics and $95 on supplies.
College kids expect to spend less than K-through-12 on clothes and shoes, about $208, and less on electronics, about $216. Shoppers will also spend on dorm furnishings ($100.27), food items ($100.18), personal care items ($81.76), school supplies ($75.73), gift cards ($71.23) and collegiate branded gear ($52.87).