Children run to catch a school bus. Inflation continues to eat into parents’ budgets, with many planning to spend more for the same amount of items. FatCamera via Getty Images
Dive Brief:
- With ongoing inflation woes, parents plan to spend 15.7% more this year compared to last year’s back-to-school season, according to a new JLL back-to-school survey of more than 1,000 parents of school-aged kids.
- According to the report, more than half (55.2%) of parents plan to spend more money this year, in part to accommodate higher prices, but nearly a quarter (23.8%) plan to spend less and 18.6% are keeping their budget about the same.
- Many survey respondents said they planned to shop with a mass merchandiser (78.3%) or an online retailer (68.7%). Among the top three retailers where back-to-school shoppers planned to buy were Walmart (58.6%), Target (54.2%) and Amazon (46%).
Dive Insight:
In addition to seeking bargains, the JLL survey found that some parents are shopping earlier for their school supplies. The cumulative share of parents shopping during June and July is 34.1% and 61.1%, respectively. However, 90.7% of parents plan to shop in August, and 92.2% of parents will shop for back-to-school supplies in September.
“Consumers will look for the sales, deals and other ways to save this back-to-school shopping season,” Naveen Jaggi, president of retail advisory services at JLL, said in a statement. “They are looking to maximize the value of their spending, particularly during a challenging economic environment, but this has made value retail appealing to families seeking affordability and creates an opportunity for retailers to adapt for growth and success.”
Though consumers are spending more on back-to-school shopping this year, the pursuit of bargains signals the ongoing toll inflation has taken on their budgets. An NPD report released last August found that more than 40% of consumers were holding back from back-to-school shopping until they spotted markdowns. Despite rising prices that stretched consumers’ wallets last year, they continued to spend, but they also switched retailers and brands in search of affordability.
In addition to inflation, another major factor that will influence consumers’ buying habits: student loan debt relief. The Supreme Court is expected to rule on President Joe Biden’s student debt relief plan soon. If the court decides to strike down the plan, resuming student loan repayments could further strain consumers’ already stretched budgets.
Though Amazon was one of the top three retailers for back-to-school shoppers, fewer consumers plan to shop there than last year. JLL’s survey found that 46% of consumers planned to shop for their back-to-school items at Amazon this year, down slightly from 50% the year prior. Walmart also saw a small decline, while Target gained slightly.
All three will be competing for customers again this year through summer sales timed to the same period. This month, Amazon announced that it will host its Prime Day sale on July 11 and July 12. Meanwhile, Target will host its Target Circle Week sales event between July 9 and July 15, and Walmart is debuting a new Walmart+ Week event, which takes place July 10 to July 13.
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