It’s not only parents who will be happy to see their children go back to school next month. Retailers are celebrating too because the average spend consumers say they’ll make for back-to-school clothing and supplies is up 10% over a year ago, at $584.
What’s causing the change? A combination of an improving economy, slightly increased consumer confidence, on-going discounting and promotional activity, and growing children (with a real need for new clothing, outgrown shoes, and depleted supplies) has increased anticipated back-to-school spend. The consumer’s view of the traditional retail 3R’s used to be ‘retailer,’ ‘rates,’ and ‘requirements,’ – which retailer was offering the best prices for stuff the kids really required. As consumers have already earned their Ph.D.’s in smart shopping, this year ‘requirements’ has moved to the top of parents’ lists.
Our annual survey (10,000 households with school-aged children in pre-school through 12th grade, drawn from the nine US Census regions) show that, unlike other major purchase events like Mother’s Day, there’s a more lopsided distribution in terms of which retailers will be the beneficiaries of consumers’ back-to-school shopping, with ‘preferred’ retail distribution looking like this: Discount Stores95%, Department Stores 60%, Office Supply 55%, Online 50%, Specialty Retailers 45%, and Catalogs 35%.
When asked where they intended to shop among retailers included in Brand Keys Customer Loyalty Index, consumers identified the following choices. And while these measures account for multiple category responses, they represent the top-10 retailers showing the greatest increases in consumer intent-to-shop since last year:
While the economy always impacts overall spend any time of the year, given the ubiquity of back-to-school merchandise offerings and pricing strategies, what brands get what piece of the academic pie is ultimately determined by what retail brands actually stand for in the minds of the parents –quality, selection, service, and the like. Brand aspects like those can quickly matriculate into surrogates for added-value in today’s marketplace. These days you don’t need a crib-sheet to discover that consumers seek out brands that possess meaning and act more positively to those retailers who do as well.
And that behavior should be a fundamental lesson for all retailers.