For many retailers, the back-to-school season offers a rush of customers buying new products, services and wardrobes to help see them through the latest semester. However, customers are spending in smaller volumes this year, demonstrating that business owners need to devise new ways of attracting shoppers and driving their customers toward their checkout registers and credit card processing services.
Families with school-age children will spend an average of $634.78 on apparel, shoes, supplies and electronics for school purposes this year, down from the $688.62 recorded in regards to the same statistic at this time last year, according to a report from the National Retail Federation compiled by Prosper Insights & Analytics. Total domestic back-to-school spending is expected to exceed $26 billion. When you include back-to-college spending, then the number increases to over $72 billion.
"The good news is that consumers are spending, but they are doing so with cost and practicality in mind," said Matthew Shay, the CEO and president of the National Retail Federation. "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."
Retailers also need to be ready to accommodate their customers with as many payment processing methods as possible, such as mobile credit card processing, lest they risk missing out on the large amounts of revenue. The report noted that many consumers are using the internet to find the best deals, and as such are spreading out their spending over a much longer timeframe than is normal. Roughly 24 percent of responding families with children in grades K-12 noted that they began their shopping more than two months before classes began, the highest such percentage recorded in the survey's 11-year history.
"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 Pam Goodfellow, director of Prosper Consumer Insights. "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."
Consumer spending, like back-to-school shopping rates, have remained stagnant. Consumer spending increased by a relatively low 0.1 percent during July 2013, down notably from the 0.6 percent increase experienced during June, according to the U.S. Department of Commerce.
