The back-to-school season has long been a powerful retail driver, accounting for more than half of annual school-related shopping.
According to the National Retail Federation (NRF), U.S. families with children in elementary school through high school spent a total of $27.5 billion on back-to-school shopping in 2018. But this year, the uncertainty over schools reopening promises to upend typical shopping patterns. Many school systems anticipate combining part-time and in-person socially distanced instruction with online learning curricula.
Here are four ways retailers are preparing for this unusual back-to-school season.
1. Planning for shifting demand.
New items will be in demand this year as parents seek out safety and sanitation products and prepare for more robust remote learning.
A survey of 6,700 American consumers by Shopkick, a shopping rewards app, found that 83% of respondents intend to buy health and sanitation items, such as hand sanitizer (97%), disinfecting wipes (89%), and masks (71%).
With remote learning slated to continue, 38% of survey respondents said they plan to shift a chunk of their back-to-school budget to software, computer equipment, and portable learning items.
"We'll be running specials and features on networking hardware, cybersecurity software, remote work apps, and other products designed to help people connect over the 'net," says Rex Freiberger, CEO of GadgetReview, a technology and lifestyle publication. "I think the number of sales for things like headsets and microphones, webcams, and WiFi boosters will go up."
Meanwhile, demand for typical school supplies may also rise as students learn at home, says Toopan Bagchi, senior advisor for The Navio Group, a retail consulting firm. Regarding back-to-school clothes, he anticipates a greater shift to athleisure apparel.
2. Bundling items.
Even before the coronavirus, pre-packaged back-to-school items were attractive to shoppers: 21% of parents surveyed by Deloitte in 2019 said they intended to purchase pre-packed kits of school supplies.
Now that families need an even more diverse array of items, including face masks and electronics, packaged kits may be an even higher-value offering.
"Where I think there's tremendous opportunity is combining and packaging up the remote learning in this unique back-to-school situation," says Josh Lamb, SVP of marketing for Shopkick. "It comes down to creative packaging. You can create value via convenience."
3. Paying particular attention to pricing.
With many out of work or uncertain about the future, parents are likely to be particularly frugal this year. Even before the pandemic, 88% of consumers during the 2019 back-to-school shopping season considered price the most important factor, according to a 2020 Deloitte survey.
This year, 40% of respondents to Shopkick's survey report they anticipate spending less than $75 per child, while 34% say they'll spend between $75-$150. With an average of two kids per U.S. family, that means most families plan to spend $300 at most in total this year, less than half of the 2018 average back-to-school spending per U.S. family of $684.79, as reported by the NRF.
Retailers should pay particular attention to pricing in this environment, finding ways to reduce costs so they can offer discounts and sales.
4. Getting ready for online sales and in-store shoppers.
Online sales are set to increase 18% this year as people stay home, according to a report released by eMarketer. For retailers, creating streamlined online shopping experiences will be key to serving customers.
However, in-store shopping for back-to-school will be surprisingly robust as shoppers get used to wearing masks and practicing social distancing as they browse the aisles. Shopkick reports that 66% of survey respondents are planning to shop in-store for back-to-school items. Retailers should prepare safety measures for a busy late-summer season.
Some types of retailers such as grocery stores can capitalize on already-robust business by adding more back-to-school items. While only 20% of Shopkick's survey respondents anticipate doing back to school shopping at the grocery store, they may buy items they need if they see them there.
"A grocery store might not have the electronics and accessories that somebody might need for remote learning, [but] why not have them right now?" says Lamb. "Same with additional school supplies. Maybe they build a bigger section because they know they're going to get the foot traffic. If they want to continue the momentum to drive revenue, it's a tremendous opportunity to pick that up."
Regardless of the creative ways they go about it, retailers' focus should be on making life easier for families, students, and teachers this fall. That looks a lot different this year than it usually does as we are all tasked with adjusting to a new normal.