Jul 5, 2016
The back-to-school season is a crucial time for the traditional supplies industry, accounting for 35% of the $11,8-billion in yearly sales and nearly half of unit sales in the US, according to global information company The NPD Group.
While the season’s importance to the industry is consistently high, at the same time how and where consumers shop, combined with other influencers from teachers to online shopping, is shaking up the industry.
“To the average consumer, back-to-school shopping may seem like a fairly consistent and predictable routine, but for retailers and manufacturers it is an extremely dynamic environment,” says Leen Nsouli, director, office supplies industry analyst, The NPD Group.
Birth of a back-to-school season online
While back-to-school shoppers are still shopping primarily at brick-and-mortar, they are increasingly purchasing supplies online. From July through September 2015, the e-commerce channel gained $90-million in dollar share growth versus brick-and-mortar.
“Consumers are spending more online and it is occurring later in the season, with a seasonal arc forming from the first week of August and lasting through mid-September. Back-to-school online share will continue to grow, making it even more essential for retailers and manufacturers to optimize their omni-channel strategies,” says Nsouli.
Shifts in school start dates and tax-free holidays
School start dates differ by region and grade level around the US, causing variations in spending patterns and influencing when consumers are in stores and shopping for supplies.
Areas such as New York and Seattle are among the latest start dates, while Atlanta and Phoenix are among the earliest. This year there will be two less shopping days between the Fourth of July and Labour Day. “Each year back-to-school spending occurs later, and a late Labour Day holiday in 2015 pushed out the spending even later than prior years. I anticipate this will also be the case this year,” says Nsouli.
At the same time, there will be differences in the handful of states that offer tax-free days during July and August. This year there will be nine less days by state versus 2015, and some others have shifted their days. This pertains not only to brick-and-mortar stores; e-commerce sites will also be offering tax-free savings on items. “All of these factors reinforce the importance of timing for retailers and manufacturers as they plan their assortments, in-store and online merchandising, and back-to-school marketing campaigns,” added Nsouli.
Influence of school lists and supply packs on purchases
“With 70% of teachers providing school lists and 30% offering school supply packs, it is no surprise that these are the primary stimuli for back-to-school supply purchases,” says Nsouli. K-6 school list items vary by region, which impacts the demand and sales for certain items in those areas.
For example, a higher percentage of thesauruses are on school lists in the Northeast, and watercolours in the West, according to NPD’s Back-to-School Supply List Database 2015. There is also a regional relevance when it comes to school supply packs, which are offered to parents for purchase by the school. According to NPD’s Back-to-School Monitor 2015, nearly 50% of consumers with this option purchased one for all or some of their children.
Inspiration from social media
“Social media engagement has added yet another dimension to every industry and season, and back-to-school is no exception. A perpetual stream of trends on platforms such as Pinterest and Instagram means that teachers and other consumers alike are being influenced in new and different ways. This has also helped to put the fashion back in function when it comes to supplies; consumers are willing to spend more on aesthetically pleasing, or fashionable, products,” says Nsouli.
In fact, last year NPD found that over one-third of US teachers used Pinterest and 20% used Facebook for classroom curriculum and school list inspiration.