A combination of pent-up demand
and a growing population of school children put 2012 back-to-school spending in
the history books, leaving parents in 2013 with an array of school supplies that
still work, and a significantly shorter shopping list.

According to the
National Retail Federation’s 2013 Back-to-School Survey conducted by Prosper
Insights & Analytics, families with school-age children will spend an
average of $634.78 on apparel, shoes, supplies and electronics, down from
$688.62 last year. Total spending on back-to-school is expected to reach $26.7
billion.

Total back-to-school and back-to-college spending combined will
reach $72.5 billion.

“he good news is that consumers are spending, but
they are doing so with cost and practicality in mind. Having splurged on their
growing children’s needs last year, parents will ask their kids to reuse what
they can for the upcoming school season,” said NRF President and CEO Matthew
Shay.

“As they continue to grapple with the impact of increased payroll
taxes, Americans will look to cut corners where they can, but will buy what
their kids need. It’s important to note, however, that spending levels are still
well above where they were a few years ago.”

The biggest portion of
back-to-school shoppers’ budgets will go toward new apparel and accessories:
95.3 percent of those with school-age children will spend an average of $230.85
on fall sweaters, denim and other chic pieces of attire. Additionally, families
will spend on shoes ($114.39) and school supplies ($90.49).

Fewer
families with children in grades K-12 will purchase electronics (55.7%), and
those that are going to invest in a new tablet or smartphone are going to spend
slightly less than last year ($199.05 vs. $217.88 in 2012).

Economy is
still a concern

It’s clear the economy is still weighing heavy on the
average family’s mind; the survey this year found eight in 10 school shoppers
(80.5%) say economic conditions will change their spending in some way. Turning
to the Internet to save money, 36.6 percent say they will do more comparative
shopping online and 18.5 percent will shop online more often.

Shopping
has begun

According to the survey, families are already out and about
shopping for school items: 23.9 percent of families with children in grades K-12
say they will begin shopping at least two months before school (i.e., right
now), up from 22.3 percent last year and the highest percentage seen in the
survey’s 11-year history. Half (49%) will shop three weeks to one month before
school, 21.8 percent will shop one to two weeks before school, 2.8 percent will
shop the week school starts, and 2.6 percent will shop after the start of the
season.

“We continue to see a shift in shopping patterns during big
spending ‘events,’ where consumers typically head out early to take advantage of
fresh inventory options and initial markdowns, then see a lull only to rev back
up again when final sales appear,” said Prosper Consumer Insights Director Pam
Goodfellow.

“Hoping to spread out their budgets but still reap the
benefits of getting the products their children want, parents this
back-to-school season will comparison shop online and around town at their
child’s favorite stores, potentially even more than once, as they seek to find
bargains and products that offer the best value.”

Department stores
still popular; teens heavily influence decisions

Though most school
shoppers (67.1%) will visit their favorite discount store for school items as
they did last year, department stores will be popular with teens and their
parents this season as well: 61.7 percent will shop at department stores, up
from 59.9 percent last year and the highest in the survey’s history.
Additionally, 51.5 percent will shop at a clothing store, 40.6 percent will shop
at an office supply store, 37.3 percent will shop online and 25.9 percent will
shop at an electronics store. One in five will hit their local drug store
(19.6%) and 13.7 percent will look for goods at thrift/resale
stores.

Stylish teens and tweens know what they need to impress their
friends when it comes to new school gear, and this year parents need to be up
for the challenge. According to the survey, 59.6 percent of parents say their
children influence at least half of their back-to-school purchases.

And
for those extra small purchases, children plan to chip in some of their own
money as well. Teens will dole out $30.13 of their own money, and pre-teens will
spend an average $18.45 — both slightly down from last
year.

Back-to-College Spending Plans Drop, but Interest in Home
Furnishings Points to Style-Savvy Millennials

Much like families with
children in grades K-12, college students and their parents will trim their
budgets this year as well, looking for ways to reuse what they have and spend
only on what they need.

According to NRF’s 2013 Back-to-College survey
conducted by Prosper Insights & Analytics, college students and their
families will spend an average $836.83 on apparel, electronics, dorm furnishings
and more, down from $907.22 last year. Total spending for back-to-college is
expected to reach $45.8 billion.

“While spending on college is down from
last year, it is still higher than what we saw in 2011, indicating that parents
this year are simply purchasing only what their college-age children need,” said
Shay. “The back-to-college market continues to grow, with specialty, discount,
department, office supply and even drug stores luring students and their parents
with attractive deals on everything from microwavable food products to personal
care items and of course, home furnishings. In such a competitive space, we
expect the deals over the next few weeks to really turn some
heads.”

Sprucing up their living spaces
When it comes to where
college students plan to live this year, on average, fewer will be in dorms or
college housing, and more will live at home. According to the survey, 22.5
percent will live in dorms, down from 25.9 percent last year, 24 percent will
reside in off-campus housing, down from 24.8 percent last year, and 47.7 percent
will commute to campus from home, up from 42.9 percent last year.

Though
almost every category will see a decrease in spending, there’s one area that
will increase for retailers: dorm and apartment furnishings. Two in five (42.0%)
families will spend an average $104.76 on new bedding, small refrigerators and
microwaves, up from $100.27 last year. Spending on food items is expected to
increase as well ($104.44 vs. $100.18 last year).

The largest portion of
college shoppers’ budgets will go toward electronics ($203.28). Other
traditional college expenditures will include clothing and accessories
($122.70), shoes ($65.60), gift cards ($65.12), personal care items ($65.08),
school supplies ($62.92) and collegiate gear ($42.94).

“Multiple factors
go into a family’s decision on where their child will live during college, and
it is likely the economy has something to do with parents wanting to keep their
costs down and forgo the traditionally expensive room-and-board route,” said
Goodfellow. “That said, we do expect those living on campus this year to do so
in style. Millennials are extremely different from previous generations when it
comes to personal style and décor, and retailers are answering their call with
trendy college-related products that will put a personal touch on their
temporary living spaces.”

College shoppers look to home furnishings
stores, online

The survey found college shoppers are already getting
ready for the school year. Nearly three in 10 (29.8%) students and their parents
say they will begin shopping at least two months before school, or right now, up
from 29.0 percent last year and the highest in the survey’s history. More than
one-third (34.5%) will begin three weeks to one month before school and 19.9
percent will begin one to two weeks before school.

Overall, parents and
their college-age children will shop around for their needs, but most will look
to discount stores (48.3%) and department stores (42.7%). Three in 10 (30.8%)
will shop at clothing stores, one-third (33.3%) will head to office supply
stores and 37.1 percent will shop online. The most in the survey’s history —
17.2 percent — will shop at home furnishings or home décor stores, up from 16.4
percent last year. Additionally, 20.4 percent will shop at electronics stores
and 18.5 percent will shop at drug stores.

Economy still a
factor

Though many economic indicators point to a growing economy, it is
clear consumers are still wary about their finances. The survey found more than
three-quarters (76.5%) of college shoppers say the economy will impact their
spending in some way, which is down from 83.5 percent last year, but still shows
caution with spending plans. Specifically, 32 percent will buy generic or store
brand products, and 37.5 percent will shop for sales more often; 10.1 percent
say the economy is impacting where their student lives for the school
year.

The survey found college seniors and their families will spend
slightly more than last year ($702.81 vs. $680.70) but will look for ways to cut
corners because of the state of the economy. Specifically, 44.8 percent plan to
make do with last year’s items, up from 38.9 percent last year, and more than
half (51%) will spend less overall on the items they do buy, up from 42.6
percent last year.

(Source: National Retail Federation,
07/18/13)

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