NRF Projects Ro­bust B-t-s Spend­ing But Slightly Un­der Last Year

This year the out­look for re­tail has shifted from gloomy to bright.

WWD Digital Daily - - News - BY DAVID MOIN

The back-to-school sea­son will be a good one for re­tail­ers but not quite as good as last year, ac­cord­ing to the Na­tional Re­tail Fed­er­a­tion.

The NRF projects to­tal spend­ing on clothes, shoes, sup­plies and elec­tron­ics such as cal­cu­la­tors and com­put­ers for those at­tend­ing grades kinder­garten through col­lege and grad­u­ate school will reach $82.8 bil­lion. That's nearly as high as last year's $83.6 bil­lion. One rea­son — many par­ents and stu­dents will wait for the best deals.

“With the econ­omy thriv­ing thanks to tax re­form and grow­ing con­sumer con­fi­dence, we ex­pect to see a very strong sea­son,” NRF pres­i­dent and chief ex­ec­u­tive of­fi­cer Matthew Shay said Thurs­day. “Col­lege spend­ing is ex­pected to be at its high­est level ever, and back-to-school will be one of the three high­est years on record.”

The fig­ures are from the NRF's b-t-s sur­vey of 7,320 con­sumers con­ducted June 29 to July 8 in con­junc­tion with Pros­per In­sights and An­a­lyt­ics. It has a mar­gin of er­ror of plus or mi­nus 1.2 per­cent­age points. The an­nual sur­vey has been con­ducted since 2003.

For chil­dren in el­e­men­tary through high school, the NRF said the av­er­age fam­ily spend would be $684.79, com­pared with last year's $687.72. The to­tal spend is seen hit­ting $27.5 bil­lion, com­pared to last year's $29.5 bil­lion, and $30.3 bil­lion in 2012, the record high since the sur­vey was taken.

Spend­ing re­lated to stock­ing up for col­lege and grad­u­ate school stu­dents will reach $942.17 per house­hold, down from last year's $969.88. How­ever, with more peo­ple at­tend­ing col­leges and grad schools, the NRF said, the to­tal spend will reach $55.3 bil­lion, up from last year's $54.1 bil­lion.

The NRF's to­tal es­ti­mate on spend­ing for kinder­garten to high school stu­dents, at $27.5 bil­lion this sea­son, is con­sis­tent with the es­ti­mate from Deloitte is­sued Wed­nes­day of nearly $28 bil­lion. How­ever, Deloitte said the to­tal in 2017 was $27 bil­lion while the NRF placed it at $29.5 bil­lion.

Ac­cord­ing to the NRF sur­vey, b-t- s shop­pers plan to spend the most on cloth­ing — $236.90 — on av­er­age. Shop­pers also plan to spend $187.10 on elec­tron­ics such as com­put­ers, cal­cu­la­tors or phones; $138.66 on shoes, and $122.13 on sup­plies such as note­books, pen­cils, back­packs and lunch boxes.

“The big­gest change we are see­ing in back-to-school spend­ing this year is com­ing from elec­tron­ics,” said NRF's vice pres­i­dent for re­search Mark Mathews. “Items like lap­tops, tablets and smart­phones are now an ev­ery­day part of house­hold life and aren't nec­es­sar­ily a pur­chase par­ents save for the start of the school year, re­sult­ing in the slight de­crease in spend­ing for this cat­e­gory.”

Un­like el­e­men­tary and high school­ers, col­lege shop­pers will spend the most on elec­tron­ics — $229.21 on av­er­age. They'll also each spend $153.32 on cloth­ing and ac­ces­sories; $109.29 on dorm or apart­ment fur­nish­ings; $102.82 on food; $83.41 on shoes; $78.70 on per­sonal care; $69.46 on school sup­plies; $62.61 on gift cards, and $53.34 on col­le­giate-branded gear.

NRF said the top des­ti­na­tions for con­sumers shop­ping for b-t-s from K to grade 12 are:

• Depart­ment stores (57 per­cent) • On­line re­tail­ers (55 per­cent) • Dis­count stores (52 per­cent) • Cloth­ing stores (51 per­cent) • Of­fice sup­ply stores (35 per­cent)

Sim­i­larly, the most pop­u­lar shop­ping des­ti­na­tions for those shop­ping to get ready for col­lege are: • On­line re­tail­ers (49 per­cent) • Depart­ment stores (40 per­cent) • Dis­count stores (35 per­cent) • Of­fice sup­ply stores (31 per­cent) • Col­lege book­stores (30 per­cent)

“One trend that we con­tinue to see dur­ing the back-to-school sea­son is the strong in­flu­ence chil­dren have on their par­ents' spend­ing de­ci­sions,” Pros­per In­sights ex­ec­u­tive vice pres­i­dent of strat­egy Phil Rist said. “This shouldn't come as a sur­prise when so­cial me­dia tools such as Pin­ter­est and In­sta­gram have al­lowed Gen-Zers to be more se­lec­tive in the items they want. How­ever, the pay­back for be­ing picky is that par­ents now ex­pect their kids to con­trib­ute to­ward their back-to-school lists.”

The sur­vey found teenagers will spend $35.60 of their own money on av­er­age for b-t-s, while pre-teens will spend $25.06.

Over­all re­tail spend­ing through the b-t-s pe­riod is ex­pected to reach a record $595 bil­lion, ac­cord­ing to Cus­tomer Growth Part­ners. That rep­re­sents a 4.3 in­crease from 2017. CGP's es­ti­mate in­cludes all re­tail cat­e­gories and de­mo­graph­ics, b-t-s and oth­er­wise, but ex­cludes au­tos, gas, restau­rants, food, bev­er­age and home im­prove­ment.

“Af­ter a slow start due to the long win­ter, re­tail has in­flected sharply up since late April and has hardly looked back,” said Craig John­son, pres­i­dent of CGP. “This is the most mo­men­tum we've seen in seven years and spans al­most all re­tail sec­tors.” He char­ac­ter­ized this year's b-t-s sea­son as “a key turn­ing point not just for re­tail­ers but for over­all con­sumer spend­ing, which drives 69 per­cent of the econ­omy.”

CGP's re­search is based on sur­veys by 18 re­searchers cov­er­ing 100 bench­mark mall and off-mall lo­ca­tions.

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