5 Things You Need To Know About Back-To-School Shopping This Year

As one of the largest spending events of the year revs up, retailers and brands have a lot on their plates. And they’re not alone. Parents, kids and college students are weighing a host of new and traditional back-to-school shopping options this year, as companies vie for share of their wallets in unprecedented fashion.

With newly launched shopping apps and special in-store promotions in their arsenals, footwear and apparel retailers are hoping back-to-school 2016 will boost otherwise lackluster margins.

Here are five things you need to know right now.

Spending Forecast To Reach An All-Time High

According to the National Retail Federation, total spending for K-12 and college is expected to reach $75.8 billion this year, up significantly from last year’s $68 billion.

As unemployment maintains a steady low and wage hikes are taking effect across parts of the country, experts say a relatively healthy and more confident consumer is partly boosting this year’s rise.

Meanwhile, the NRF also notes that back-to-school spending is on a “stock up” cycle rather than a “make do” cycle, meaning that families are willing to spend more loosely this time around as they aim to store up extra goodies for the school year.

Price (And Off-Price) Will Dominate Decision Making

A survey conducted this summer on behalf of cash-back Web platform Ebates found that cost is often the deciding factor for parents when it comes to back-to-school shopping.

Specifically, 55 percent of Americans surveyed said price was the most influential factor in their b-t-s purchases compared with just 20 percent who selected product quality as the most influential factor.

Add in that the off-price channel continues to dominate brick-and-mortar retail trends, and you have the go-to savings formula for shoppers this season. (The NRF says discount stores are the most popular destination for both back-to-school and back-to-college shopping.)

Online Shopping Will Come Down To Shipping Options

It is well known at this point that consumers are heading online at increasing rates for their footwear and apparel as well as other shopping needs. (An NRF survey found that interest in online shopping this b-t-s season has seen a more than 30 percent year-over-year jump.) But new research suggests that shipping options are perhaps the real game changer for many consumers when it comes to utilizing the e-commerce channel.

An NRF survey found that more than 80 percent of back-to-school and college shoppers plan on taking advantage of free shipping this year. A study by Bizrate Insights found that 55 percent of consumers use in-store pickup options in order to avoid shipping charges.

Gen Z More Apt To Ditch Labels

Research shows today’s youthful consumer is far less interested in logos and labels than previous generations. A desire to stand out from the crowd instead of fitting in — the mantra of millennials who were raised in the ’90s — is leading Gen Z shoppers to seek out more niche labels and even generic brands that lack bold logos.

One way footwear and apparel companies can circumvent big-brand phobia is by offering customizable goods.

Matt Powell, a sports industry analyst with The NPD Group Inc., suggested that athletic companies offering customizable product will have sticking power by allowing teens to sport the “it” brand of the moment but with creative personal touches.

“Products that give them the option to wear a color that nobody else has or a shoe they can make their own are important to this generation,” Powell said. “And so far, Nike and Adidas are at the forefront of this.”

Weather Expected To Impact Apparel Sellers The Most

According to Cowen and Co. analyst Oliver Chen, apparel could remain deflationary if weather does not cooperate this season. But so far, forecasts point to a favorable backdrop.

“We worry for most apparel retailers (especially department stores), if we are plagued with yet another unseasonably warm winter,” Chen wrote on Aug. 2. “However, weather across the country as a whole, and especially in the Northeast, is expected to be more favorable for apparel retailers in 2H16 (cooler temperatures year-over-year in early September, to help fall and [b-t-s] sales, and more importantly, cooler temperatures year-over-year in November and December), and could help drive higher sales of cold-weather goods such as outerwear.”

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