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Back to School 2021 Hindsight Report

Shopping Predicted to Hit Record Numbers as Transitions are Made Back to the Classroom
The National Retail Federation predicted that consumers would plan to spend record amounts for both school and college supplies as families and students returned to in-person classrooms this fall. According to NRF’s annual survey, total back-to-school spending in 2021 was expected to reach a record $37.1B, up from $33.9B last year, an all-time high in the survey’s history. While online shopping remained a top destination for back-to-school shopping, families were much more comfortable shopping in store this year than last year during the peak of the pandemic.

So, what were they predicted to spend on? Overall, consumers were predicted to spend more on items like electronics and clothing as they made plans for students to resume activities in person this fall. For those in grades K-12, back-to-school shoppers planned to spend $21 more on average on electronics this year compared with 2020 and $19 more on clothes. Those in the market for back to college (BTC) were to spend slightly more on electronics and 15% more on dorm/apartment furnishings, while only 5% more on clothing.

Back to Stores for Back To School Supplies and Apparel Sales Leading the Way
Alliance Data conducted a survey from September 7 to 10 to find out how shoppers dealt with the 2021 back-to-school season. Our proprietary consumer research showed a majority of those polled has already completed their BTS shopping and did so within the early August time frame. As predicted by NRF, 48% spent more this year than last year and 66% did so in stores versus online at 34%. Seventy-seven percent purchased school supplies while over 58% purchased apparel and 36% spent their dollars on personal care and beauty.

  • Twelve percent used buy now, pay later (BNPL) to pay for BTS shopping this year. Eighty-five percent said they accessed a BNPL service directly from a retailer’s website, while 15% said they accessed the service through a BNPL service provider.
  • Fifty-three percent of those that used a BNPL service for BTS shopping said it was their first time using it, and 42% said they have used a BNPL service before.
  • Thirty-two percent said that they heard about the BNPL service through social media, 19% directly from a BNPL app or web experience, 18% directly from a retailer’s website or mobile app, and 15% from a store associate.
  • Consumers who said they used a BNPL service for BTS shopping also used other services like free shipping (48%), retailer apps (41%), and buy online, pick up in store (BOPIS) (35%).
  • BNPL consumers were slightly more eager to do some of their holiday shopping during BTS season—62% said they had and 37% said they had not.

Social Media Influences the Use of BNPL Services as well as Retailer-Based Sites
Of those surveyed, 12% mentioned BNPL services as being the method of payment for BTS shopping. BNPL services were accessed mainly from the retailer website (85%) as opposed to directly from a BNPL service (15%).
Millennials led the way from a generational perspective to use a BNPL service (18.9%) and Gen Z followed with 17%. Those that did not utilize were Gen X (8%) and baby boomers (2%).

Overall, 53% said it was their first time using a BNPL service and 40% said they had used one before. Social media was the lead channel generating awareness and use of the BNPL service (32%). Customers also heard about the service directly through retailer sites (18%), from BNPL program sites (18%), and from store associates (16%).

Brands Help Brands and Students "Get Back To Life" Through Omni-Commerce
While there was still much uncertainty surrounding the coming academic year, many consumers were hoping to see the promise of “back to life.” This promise, coupled with delayed fashion spending in 2020, created a dynamic this back-to-school season for brands to capitalize on. Brands helped consumers get back to life with a surround-sound, “omni–commerce” approach to back-to-school. Brands pulled all levers—commerce, community, and collaboration—to recruit and retain shoppers this BTS shopping season.
Other brands looked to unique differentiators to drive customer engagement, including:

  • Commerce — Offering new ways to buy every step of the way.
    Customers are more familiar with omnichannel and they are using it a lot more. Brands responded and made reasons to buy more prevalent within every aspect of the shopping journey. Buy online, pick up in store continues to be more noticeable and present.
    Target’s buy online and pick up in person near their respective colleges allows first-time dorm room decorators to allow for parental involvement.
  • Community — Shopping is a team sport (business to business)
    Shopping directly from social media platforms is becoming increasingly popular, particularly as e-commerce becomes the preferred method of shopping. But it wasn’t just shopping directly from the social apps that made social media platforms so appealing during this season’s back-to-school.
    Snapchat offered a checklist that brands could review when planning their back-to-school social campaigns, including offering ways for their customers to share excitement about being back in school and to communicate their purchases and recommendations to Snapchat friends and followers.
  • Collaboration — New duos were on the scene
    Brands were looking for new ways to steal attention and traffic from both direct-to-consumer (DTC) and other specialty retail brands during this season. Brands partnered up—including Walmart and Justice and Ulta and Target, respectively—to bring in new consumers and gain their share of the back-to-school wallet.
    These powerful collaborations act as strategic imperatives for brands and retailers to create relevant connections and bolster their understanding of their core shopper. Plus, they create opportunities to expand a brand’s audiences now and moving into the holiday season.
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