When each day is a sale, stores fight to get shoppers to buy in
Chip Bergh, the CEO of Levi Strauss & Co., remembers when back-to-school shopping was a one- or two-week thing. Now, it seems to go on forever.
“Back to school used to be a moment,” Bergh said, recalling the briefer periods of yore “where it was like a fistfight in the stores.” Today, “it’s morphed into five weeks.”
The prolonged back-toschool season mirrors what’s happened with other annual sales events, as retailers drag out the moments that bring shoppers in the door as long as possible. Black Friday, still the kickoff for the crucial year-end period, is now followed by the online deals of Cyber Monday — but the lion’s share of holiday sales come in discount-fueled December.
Even Prime Day, the midsummer event invented by Amazon, has been stretched to encompass two days, with competitors extending their promotions on the front and back ends.
For apparel chains, this often means that sales bleed into each other, and companies struggle to get shoppers excited for the next round of discounting before the current one has ended.
“Everything is so over-promoted these days,” said Craig Johnson, president of Customer Growth Partners. “People can be promoted out. They get bored with it.”
The endless sales have changed shoppers’ attitudes, with many now expecting discounts available at any given moment, rather than at designated times of the year.
“Consumers are numb to all the promotional activity,” Levi’s Bergh said. “So a 20% back-toschool offer is no different than whatever is going to happen in early September, when it’s going to be 20% off anyway.”
This is forcing retailers to manage their inventories more nimbly and keep the pipeline of new products flowing so the selection feels fresh for shoppers who visit several times during any given season.
The stakes are high to get it right: This year, American parents are expected to spend $507 on average for clothing, electronics and other school-related items, according to a study from RetailMeNot. That’s up from $465 in 2018.
Deloitte, meanwhile, sees back-to-school spending for kindergarten through 12th grade totaling $27.8 billion this year, a rise of 1.8% from 2018.
Failing to move product quick enough can be detrimental for retailers — piled-up inventory erodes profitability because it costs money to store and organize it, and companies have to discount deeply to get rid of it. Gap and J.C. Penney have gone through costly buildups of inventory in recent years that required markdowns to clear up.
American Eagle Outfitters, which caters to mostly teenagers and young adults, is seeing shoppers opt for multiple trips to the store per season instead of just one, according to Chad Kessler, the company’s global brand president. Part of the repeat visits is driven by peer pressure.
With repeat back-to-school shopping visits becoming the norm, that means “making sure that we have delivery every month, so every time the customer comes back, they have something new,” Kessler said.