The National Retail Federation (NRF) has just released a report on back-to-school spending forecast for 2015. They believe families will be choosing to spend less to get their children ready for school this year following a shopping splurge back in 2014.
The NRF had its Back-to-School and Back-to-College surveys conducted last June 30 to July 8, 2015. It involved a poll of about 6,500 consumers who helped the NRF effectively “gauge consumer behaviour and shopping trends related to back-to-school spending and back-to-college spending.”
The recently concluded NRF Back-to-School Survey that was conducted by Prosper Insights & Analytics revealed that families with children who are in grades K-12 see the need to only spend around $630.36 on electronics, apparel and other school needs last year, when they were willing to spend as much as $669.28.
Furthermore, families this year are seeing a lesser need to spend on electronics following their purchase back in 2014 when 58.3% parents have said they are going to spend an average $212.35 for their children who are going to school. This year, families have decided to cut on gadget spending, saying they only expect to spend an average of $197.24.
The recent trend actually makes sense as NRF President and Chief Executive Officer Matthew Shay explains, “As seen over the last 13 years, spending on ‘back to school’ has consistently fluctuated based on children’s needs each year, and it’s unlikely most families would need to restock and replenish apparel, electronics and supplies every year.”
Moreover , he added, “Parents this summer will inventory their children’s school supplies and decide what is needed and what can be reused, which just makes good budgeting sense for families with growing children.”
Nonetheless, family back-to-school spending has gone up by 42% over the past ten years.
Among those who have stated they will be doing some shopping to restock on various things their children will be needing for school, 92.7% have said they will spending an average of $217.82 on new apparel while an average of $117.56 will be spent on new shoes. Meanwhile, 94.1 of those who will be doing some shopping have also said they expect to spend an average of $97.74 on new school supplies.
Stores can expect some of the back-to-school shopping to start as early as 2 months ahead of the school year. The NFR survey revealed that at least 19.6% of parents plan to do exactly this while 42.8% prefer to start their back-to-school shopping anywhere between three weeks to one month before school starts. Still, 30.3% of families are confident they can complete their back-to-school shopping just one to two weeks before school starts.
Of the parents who plan to do their shopping two months ahead, 64.9% have said that doing this allow them to spread out their budgets while 51.1% simply want to avoid crowds when they are doing their shopping.
As for shopping destinations for back-to-school items, 62.2% of families plan to check out a discount store while 56.4% will head to department stores. Meanwhile, 35.6% of parents prefer not to go out for their back-to-school shopping and simply purchase everything online. With regard to online shopping, the NRF survey has also found that about 48.4% of families who plan to shop online will be using the retailer’s buy online, ship to store or store pick up options.
As Prosper’s Principal Analyst Pam Goodfellow explains, “Savvy and budget-conscious parents today have plenty of experience when it comes to looking around for great deals and value-add promotions, and it seems mom and dad will use that to their advantage this summer to take advantage of retailers’ omnichannel services. To ease hectic schedules and long shopping lists, it’s likely that we’ll continue to see consumers try out and regularly use services like free shipping, reserve online and even same-day delivery — options busy parents have been waiting for.”
Meanwhile, those who are expected to take advantage of online shopping are parents who are millenials. For the survey, millenials have been broken down into 18-24 and 25-34 age groups. Interestingly, about two-thirds of millenials in the 18-24 age group prefer to pick up in store or ship to store option while 15.4% of the 25 to 34 age group will opt for the reserve online option.
For college students, the NRF also found that there is also less spending involved when it comes to electronics and supplies compared to last year. This year, college students and their parents are looking at spending just an average of $899.18. Last year, they were willing to spend an average of $916.84.
Nonetheless, Shay believes that college back-to-school shopping will still involve a splurge on other items. He said, “We fully expect families to take advantage of retailers’ unique promotions on home furnishing items, apparel and even electronics, while still reusing what they can in good frugal fashion.”
In fact, spending on home goods for college is expected to exceed any previous year. The NRF back-to-college survey revealed that about 51.3% of college shoppers plan to spend an average of $126.30 for dorm or apartment furnishings. This amount is higher by 30%, compared to last years planned spending of $96.70. Moreover, more college students (31.3%, compared to last year’s 23.9%) are also planning to stay in a dorm room or college housing during the school year. Nonetheless, 21% of college students prefer to live off-campus while 46.8% prefer to go back home after class.
The NRF believes that total spending for K-12 and college will reach as much as $68 billion.