Back-to-school spending is expected to reach new heights this year against financial headwinds and uncertainty following two years of COVID-19.
Shoppers will shell out upwards of $34.4 billion for K-12 students, a 5.8% increase over last year and 24% since 2019, according to the 2022 Deloitte Back-to-School Survey, released last week. The approximately $661 spend per child is 8% better than last year and 27% since 2019.
Deloitte’s College Survey counterpart showed that shoppers plan to spend $28.3 billion (6% increase over 2021; 13% over 2019), or $1,600 per student (up 10% from 2021 and 18% from 2019) for back-to-college goods.
Inflation is weighing on the minds and wallets of many back-to-school shoppers, the survey said. Over half (57%) of surveyed K-12 parents expressed concern about price hikes for BTS products. While 33% said their financial situation has declined in the past year, 37% of respondents plan to spend more this year.
After two years of disruptions spurred by the pandemic, parents are ready for a more “normal” shopping approach to the coming school year, Deloitte’s research revealed. Still, the unstable economic and social climate stands to bring more complexity to the back-to-school season. For example, 36% of K-12 parents said they’re worried about making school-related payments, and 54% think the economy will weaken further in the next six months, up from 28% in 2021.
“Even as economic and inflationary pressures sit top-of-mind, parents seem resilient and determined to ensure their children get the school supplies needed to succeed this coming year,” explained Nick Handrinos, vice chair and U.S. leader of retail, wholesale and distribution and consumer products at New York-based Deloitte LLP. “Retailers that remain conscious of this determination, while being mindful to address shoppers’ ongoing economic concerns, could earn trust and position themselves strongly.”
The 2022 Deloitte Back-to-School Survey polled 1,200 parents with at least one child attending school in grades K-12 this fall, while the 2022 Deloitte Back-to-College Survey polled a sample of 950 parents of children heading to colleges and universities in the fall.
K-12 shoppers said they will purchase more clothing and accessories (up 18% year over year) and traditional supplies (up 7%) as technology spending wanes (down 8%) following two years of growth, as most parents (81%) said their schools provide the necessary devices and other technology, Deloitte reported. Conversely, robust tech spending is expected to continue among college shoppers (up 22%).
By retailer, 81% of consumers polled named mass merchants (versus 74% in 2021) as their preferred destination for BTS shopping, followed by 56% for online-only retailers (vs. 49% in 2021), 40% for dollar stores (vs. 41% in 2021), 30% for specialty apparel stores (vs. 26% in 2021), 30% for office supply/technology stores (vs. 26% in 2021) and 28% for department stores (vs. 21% in 2021). Almost half (49%) said they expect to spend most of their BTS dollars this year at mass merchants, compared with 16% for online-only sellers, 5% for department stores, 5% for fast fashion apparel retailers, 4% for specialty clothing stores and 4% for dollar stores.
Other key takeaways from the Deloitte surveys:
• The back-to-school shopping season is returning to normal if still slightly earlier with 53% of spending expected by the end of July.
• In-store BTS shopping is expected to see a resurgence, accounting for 49% of spending, up from 43% in 2021.
• Nearly two-thirds (64%) of survey respondents expect out-of-stocks this year. Higher costs and lack of inventory will put brand loyalty at risk, as 77% said they will trade brands in those cases.
• And 50% of K-12 parents and 47% of college shoppers will choose environmentally friendly or responsibly sourced products when possible. K-12 shoppers are expected to spend 22% more on these products than the average shopper and college shoppers 19% more.
K-12 parents’ online spending is expected to decline to 35% this year from 39% in 2021, according to Deloitte’s survey. Free shipping is a must; 79% of respondents said it’s more important than fast shipping.
Only 35% of parents plan to leverage social platforms for their shopping, compared with 41% in 2021. Generation X shoppers will use social media to seek deals, while Millennials are more likely to look for reviews and advice.
“Digital shopping channels reached a saturation point,” Deloitte stated. “Although still higher than pre-pandemic levels, consumers indicate digital fatigue.”
On the college side, while in-store's share of spending is expected to increase to 44% this year from 39% in 2021, 59% of respondents aim to shop via smartphones (up from 49% in 2021), 30% via social media (up from 22%) and 44% via emerging technology (up from 29%).
Many college shoppers (68%) expect out-of-stocks, and 56% of planned spending will likely occur by the end of July.
Much of back-to-college spending still goes to digital products.
“As the pandemic continues to reshape higher education, the influence of digital trends remains,” Deloitte noted. “Despite economic concerns, parents of college-age students seem determined to spend, driven by digital integration in the college experience.”
College shoppers expect to spend 22% more on technology products this year, following 16% growth in 2021, outpacing household appliances and supplies (up 12%), clothing (up 10%), and dorm or apartment furniture and supplies (down 15%). Forty-one percent of students will attend college online or in a hybrid mode, so parents plan to spend the same or more on online learning resources (51%) and buy fewer traditional college supplies (53%).