NRF: BTS/BTC spending to be driven by electronics and school supplies
July 17, 2014,
Washington – Millennials expect to spend up to $913 million of their own money on school items for the back-to-school/back-to-college season this year, driven by increased demand for electronic items and parents’ need to restock their children’s school supplies from last year.
This and other findings stem from the National Retail Federation’s newly released 2014 Back-to-School Survey.
“Slow improvements in the economy may have contributed to the growth in confidence among back-to-school shoppers, and while we are encouraged by the overall tone of the results and expect to see continued improvement in consumer spending through the year, we know Americans are still grappling with their purchase decisions every day,” said Matthew Shay, NRF president and ceo. “Throughout the history of this survey, spending has fluctuated based on family needs each year, and this summer, we expect parents to continue to use caution, but also make smart decisions for their family budget that is a good balance between what their children ‘want’ and what they actually need.”
As the survey found, combined spending for back to school and college is expected to reach $74.9 billion.
But having a longer list of items to buy that are also commonly known to be pricier than their younger counterparts, college students and their families are the real “golden geese” when it comes to school shopping, NRF noted. That said, the average college student and their family will spend $916.48 on dorm furniture, school supplies, electronics and more -- up 10% from $836.83 last year. Total college spending is expected to reach $48.4 billion.
“The ‘varsity’ class often gets overlooked each summer as back-to-school shoppers drive the news, but the truth is that today, college students and their parents contribute a significant amount to the economy” Shay continued. “Not immune to economic challenges, college students themselves and their parents will take great care when checking items off their lists. Retailers, hoping to get a head start on this extremely competitive shopping season, will attract these Millennials [those born between the early ‘80s and late ‘90s] with promotions through Instagram and other social channels, as well as through content that speaks to these tech-savvy, fashion-forward students.”
When it comes to purchases of electronic items and computer-related equipment, college students and their parents plan to spend an average of $243.79 on laptops, desktop computers, netbooks, tablets, smartphones and more, up 20% over last year’s $203.28 and the highest amount since 2009. Graduate students will spend the most on electronics ($275.24). After cutting back last year, spending on school supplies is expected to increase 19% to $74.80 on average.
“Likely driven by fashion-forward Millennials hoping to head to college in style,” NRF said, parents and their students will spend 13% more on apparel ($138.73 vs. $122.70 last year). Others will spend on food items ($103.87 vs. $104.44 last year), shoes ($77.60 vs. $65.60), personal care items ($78.08 vs. $65.08), and gift cards ($55.56 vs. $65.12.)
With an array of items to stock up on before classes start, parents will take their college students all over town to get the best deals: Most (50.5%) will shop at discount stores, up from 48.3% last year, and department stores (46.6%), up from 42.7% last year. Online will be a popular destination for shoppers, with more than two in five (44.6%) planning to check out retailers’ websites for special promotions, up from 37.1% last year and the highest in the survey’s history.
When it comes to mobile usage, nearly six in 10 (57.8%) will use their smartphone in some fashion as they shop for college items. Of those with smartphones, the survey found one-third (33.8%) will research products, the highest since NRF added mobile shopping questions to its survey in 2011. Additionally, one in five (22.4%) will purchase items, up from 19.1% last year and another survey high, and 29.8 % will look up retailer information, up from 20.9% last year.
More than half (54.5%) of tablet owners will use their tablet to shop for college items. Specifically, 37.4 % will research products, and 27 % will use their tablet to purchase items.
Turning to the younger set, this summer families will spend slightly more on back-to-school items than last year. More specifically, the average family with children in grades K-12 will spend $669.28 on apparel, shoes, supplies and electronics – up 5% from $634.78 last year. However, total spending on back to school will drop slightly to $26.5 billion as the survey found there are slightly fewer students in households this summer.
Overall, every category will see an increase in spending, including healthy increases in average spend on supplies and electronics, NRF’s survey found. Back-to-school shoppers will spend an average $212.35 on electronic items, up 7% from $199.05 last year, with total spend expected to reach $8.4 billion. High school students and their families specifically will spend an average $229.88 on electronic items.
“Perhaps due to school districts’ growing requests for classroom supply contributions,” NRF noted, spending on school supplies will increase 12% to an average of $101.18, compared to $90.49 last year. Additionally, shoppers will spend an average of $231.30 on clothes, up from $230.85, and $124.46 on shoes, up from $114.39 in 2013.
While department and discount stores will be the most visited among school shoppers, Millennial students may be driving an increase in planned spending at specialty stores. The survey found: 53.8% of back-to-school shoppers will shop a clothing store, up from 51.5% last year and a survey high; and 27.5% will shop at electronics stores, up from 25.9% last year and another survey high. Six in 10 (64.4%) will visit discount stores, 59.1% will shop at their favorite department store, 42% will shop at office supply stores, 38.2% will shop online, and 20.5% will shop at drug stores.
Timing is another factor shoppers are considering. One-quarter (25.4%) will take advantage of retailers’ late summer deals and shop one to two weeks before school, up from 21.8% last year; one in five (22.5%) will shop at least two months before school starts, and another 44.5% will shop three weeks to one month before school starts. Additionally, 4.3% will shop the week school starts, and 3.4% will start after the start of the school year.
“Tweens and Millennials to play a big role in back-to-school shopping this summer,” NRF said. “There’s no question that today’s Millennial high school students are unique in many ways, and when it comes to shopping, these kids want to make sure they are a part of their parents’ buying decisions…When it comes to the influence these students have on their parents’ purchasing decisions, the evidence is indisputable.”
As such, teenagers are planning to spend $913 million of their own money on school items, ensuring their style shines through all year long, with the average 13-17 year-old planning to spend an average of $34.40, up from $30.13 last year. Pre-teens will spend an average $22.27 of their own money, totaling $544 million.
But parents will still provide a large part of the funding for BTS/BTC, and they will heed their kids’ opinions on these purchases more than ever, the survey found: 9.7 % of parents admit their child influences 100% of what they buy for back to school, up from 7.6 % of parents last year and the highest in the survey’s six-year history.
“It’s safe to say this generation takes back-to-school shopping much more serious than their older brothers and sisters did, with many kids today influencing almost everything their parents buy for the upcoming school year,” said Pam Goodfellow, Prosper Insights consumer insights director. “Students will make sure to keep one eye on social media and the other on retailers’ websites as they seek out what’s new and exciting in their hunt for fresh, fashionable and relevant back-to-school gear.”
This is also expected to be a “big year” for mobile back-to-school shoppers, NRF said, with families planning to turn to their handhelds to aid in their shopping. The survey said 36.7% of smartphone owners shopping for school items will research products using their mobile device, up from 34.7% last year and the highest since NRF started asking in 2011. One in five (21.8%) will make a purchase via their smartphone, up from 18.2% last year and another survey high. And while many will simply shop online directly through their smartphone, one-quarter (25.1%) will use their device to find information about a physical store.
School shoppers that own tablets will also use their device more to shop this summer; 31.4 % will purchase school items via their tablet, up from 29.9 % last year, and 45 % will research products, up from 41.8 % last year.
Related Content By Author
The Countdown to the ICON Honors Continues featuring Christophe Pourny