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Dive Brief:

  • Inflation’s effect on consumer behavior has hit back-to-school spending, as such purchases have fallen behind sales of other goods, according to research from the NPD Group. Back-to-school spending is below last year, while other general merchandise sales rose 4% year over year, NPD said.

  • Early in the season, items like water bottles and art supplies were among the fastest growing school-related purchases, NPD researchers said. But that spending failed to keep pace with growth in beauty and automobile-related goods, they said.

  • A little over 40% of those abstaining from back-to-school shopping were holding out for discounts, according to NPD. They may be waiting for Labor Day, as 45% of those who plan to shop over the sales weekend say they’ll compare prices, while 31% will stock up on sale items, 18% will wait for an item to go on sale and 29% will buy only necessities, according to research from Numerator.

Dive Insight:

School is underway in many areas, but students may be starting the year less well-equipped as their parents postpone many purchases in order to contain their household budgets and focus on other areas. Over the summer that included putting money toward travel and other social activities, according to Marshal Cohen, chief retail industry adviser for NPD.

“Consumers are balancing their return to school, work, and social activities, while retaining some pandemic-related behaviors, and prioritizing their purchases accordingly,” he said in a statement.

This behavior continues a new tradition of consumers spreading out their seasonal purchases, according to Cohen. In 2020, at the height of the pandemic and before vaccines were available, retailers launched early deals, sapping some energy out of Black Friday.

“This is another example of here-and-now shopping leading to shallower retail spending peaks, with sales realized over a longer stretch of time,” Cohen said of this year’s back-to-school season. “Consumers are still spending on summer fun, and the back-to-school focus has yet to kick into high gear — but it will.”

Retailers are already resorting to promotions to drive sales, Cohen said. That could be the name of the game in retail for the rest of the year, as consumers seek out deals and even switch brands.

“While retailers have clearly begun to use promotions to drive more sales, marketers need to continue entice the acceleration of back-to-school purchasing in general, and create some urgency for apparel, technology, and other high-volume stragglers,” Cohen said.



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