Last year, we discussed the impact of back-to-school shopping online and how more parents are looking online for clothing, school supplies, and other items compared to previous years. In 2014 and moving forward, it appears as if back-to-school (July and August) shopping will be even bigger, with sales projected to rise exponentially. Let’s take a look at the latest back-to-school eCommerce projections for the 2014-2015 school year…
- U.S. back-to-school online sales are expected to increase 16% to $50 billion – While the percentage increase is down from 18% last year (according to eMarketer), back-to-school sales will surpass $50 billion for the first time ever. This is a significant milestone for the online retail industry as back-to-school sales only recently surpassed $30 billion mark back in 2011. The 16% growth rate is also almost triple the 5.9% growth rate expected for the online retail industry as a whole in the third quarter of 2014.
- Key product categories will make up the majority of back-to-school sales – Of the $50 billion projected to be spent on back-to-school items this year, $27 billion will come from key back-to-school product categories (apparel/accessories, entertainment, electronics/toys, and office equipment/supplies). This is an increase of $4 million from 2013 back-to-school sales in these key combined product categories.
- The “back-to-school” phenomenon is evolving into a mini-holiday season – According to the NRF, back-to-school is now the second busiest shopping season of the year. With this growth comes retailers looking for new opportunities – much like how holiday promotions can now start in October, back-to-school deals are now starting to creep into late June. For comparison purposes, back-to-school revenue is about one-ninth as much as holiday season revenue.
- Increased school enrollment may be aiding in online sales growth – The U.S. Department of Education has estimated that for the fall of 2014 enrollment rates will be approximately 77 million students (55 million in K-12 schools, 22 million in postsecondary institutions). These are the highest enrollment totals ever for U.S. schools and despite the increasing college costs, more than three million additional students will be attending college than compared to 2007 (18 million students).
- Parents research and make back-to-school purchases at different times – July is all but the unofficial month for researching back-to-school products. A recent study by Google and Ipsos Research concluded that 65% of U.S. internet users started their back-to-school research in the month of July. Many of these researchers, however, waited until August to make purchases – 48% of U.S. internet users made back-to-school purchases in August, only 35% made purchases in July.
- Specific parental triggers spark back-to-school purchases – Research by Thomson Reuters and Ipsos indicated certain triggers influenced back-to-school purchases. Sales and special offers were the leading influencers in aiding a purchase (54% of all parents were influenced by these factors), followed directly by teacher recommendations (48%). The research yielded a surprising result as only 7% of all parents were influenced by recommendations from other parents, with 34% of parents just opting for items their child or children request.
In conclusion, back-to-school shopping continues to evolve into an experience that is becoming more conducive to shopping online. As millions of additional children enroll in school and new parents continue to rely less on peer recommendations for back-to-school purchases, it enables online retailers with timely marketing strategies to understand and capitalize on consumer tendencies to increase sales. The back-to-school phenomenon isn’t set to go away anytime soon – if anything more retailers will start paying attention to the summer season and possibly use it as a testing ground for Cyber Monday and/or holiday initiatives.