News | July 14, 2009

NRF's 2009 Back-To-School And Back-To-College Surveys

The rules of back-to-school shopping have officially changed: buy only what you need, check for coupons and sales before hitting the stores, and, if you can find the perfect computer at the right price, grab it! According to the National Retail Federation's 2009 Back to School Consumer Intentions and Actions Survey, conducted by BIGresearch, the average family with students in grades Kindergarten through 12 is expected to spend $548.72 on school merchandise, a decline of 7.7 percent from $594.24 in 2008. Total spending on back to school is expected to reach $17.42 billion.*

2009 back-to-college and back-to-school spending combined will total $47.50 billion.

According to the survey, the economy is having a major impact on back-to-school spending as four out of five Americans (85%) have made some changes to back-to-school plans this year as a result. Some of those changes impact spending, with 56.2 percent of back-to-school shoppers hunting for sales more often, 49.6 percent planning to spend less overall, 41.7 percent purchasing more store brand/generic products and 40.0 percent are planning to increase their use of coupons. Others say the economy has impacted lifestyle decisions, with 11.4 percent saying children will cut back on extracurricular activities or sports and 5.7 percent saying that the economy is impacting whether their children will attend a private or public school.

"The economy has clearly changed the spending habits of American families, which will likely create a difficult back-to-school season for retailers," said Tracy Mullin, President and CEO of NRF. "As people focus primarily on price, strong promotions and deep discounts will ultimately win over back-to-school shoppers this year."

Spending in most back-to-school categories is expected to decrease, with one bright spot: electronics. With personal laptops and desktop computers increasingly affordable for most families, spending on electronics and computer equipment is expected to increase 11 percent. According to the survey, the average family plans to spend $167.84 on those purchases, compared to $151.61 last year. Families will also spend an average of $204.67 on clothing and accessories, $93.59 on shoes, and $82.62 on school supplies.

While discount stores (74.5%) will be the most popular destination for back-to-school shoppers, the number of people planning to buy school items at drug stores is expected to rise substantially. According to the survey, nearly a quarter (21.5%) of families will shop at drug stores for back–to-school, an 18 percent increase over last year's 18.2 percent. Drug stores have become more popular recently as their merchandise mix has broadened beyond health and beauty products to include school supplies, small electronics, and even groceries.

In addition to discounters and drug stores, more than half of back-to-school shoppers will head to department stores (54.4%), nearly half (48.4%) will shop at a clothing store and 41.2 percent will visit office supply stores. Additionally, 22.2 percent will shop online, 20.8 percent will shop at electronics stores and 18.2 percent will shop at a thrift store.

"Americans will be looking far and wide for the best back-to-school deals, using newspaper ads, online promotion codes, and a lot of comparison shopping before making decisions," said Phil Rist, Executive Vice President, Strategic Initiatives, BIGresearch. "This year, many parents hope to begin back-to-school shopping early to spread the spending out over a longer period of time."

While the first days of school may seem eons away, many Americans have already started shopping. According to the survey, the majority of Americans (44.4%) will begin their shopping three weeks to one month before school starts, trying to take advantage of retailers' early promotions and spend over time. An additional 31.8 percent will shop one to two weeks before school starts and 2.5 percent will shop after school starts, hoping to take advantage of clearance sales and postpone purchases as long as possible.

Average College Spending Increases Slightly, Students More Likely to Live at Home

Even with the uncertainties the economy continues to present, college-bound students and their families are prepared to shell out a little extra this year. NRF's back-to-college survey, conducted by BIGresearch, found that college students and their parents will spend an average of $618.12 this year, up three percent over last year's $599.38. With fewer people planning to attend college this fall, total college spending is expected to decrease to $30.08 billion*. While the number of people attending undergraduate schools is not expected to change significantly, according to the survey, the amount of people who say they will participate in an advanced degree program is expected to drop this year (48.1% of respondents last year versus 38.9% this year).

"The economy is forcing young adults to make hard decisions about which schools to attend, where to live, and what's really a "necessity" for college," said Tracy Mullin, President and CEO of NRF. "This year, college students are just as focused as their parents on finding good deals and making smart choices with their money."

As with people who have school-aged children, 83 percent of Americans with students already in or planning to attend college say they the economy is impacting back-to-college plans**. According to the survey, back-to-college buyers say the economy will cause them to spend less overall (48.0%), shop for sales more often (46.1%), and comparative shop with ad circulars/newspapers (30.8%). The economy will also cause some students to make do with last year's school items (33.6%), share or borrow textbooks instead of buying new ones (17.4%), and will impact students' choice of college (15.0%).

In addition, 12.8 percent of survey respondents say the economy will impact where a student lives, with many choosing to save money by living at home. Nearly three out of five (58.5%) college students will be living at home this year, compared to 54.1 percent last year and 49.1 percent in 2007. As a result, fewer students will live in a dorm room or college house (15.8% vs. 18.0% in 2008) and in off campus apartments or homes (22.4% vs. 24.3% in 2008).

"Parents want to give their children everything necessary for the best education, but, this year, living at home may need to be a concession students need to make," said Phil Rist, Executive Vice President, Strategic Initiatives, BIGresearch. "The trend of students living with their parents will disproportionately impact home furnishings retailers, as fewer people may be purchasing kitchen items, home décor and furniture."

Much like back-to-school shoppers, families of college students will heavily increase their dependence on drug stores this year. According to the survey, 23.4 percent of back-to-college buyers will shop at drug stores, a 38 percent increase from last year's 14.3 percent. Back-to-college shoppers will purchase from discounters (53.4%), college bookstores (44.5%), department stores (43.1%), and office supply stores (32.5%) most frequently.

As in previous years, families of freshmen will spend the most on back-to-college purchases ($820.77 on average), largely due to major purchases of computer and dorm furnishings. Sophomores will spend the second-highest amount ($496.16), followed by juniors ($470.56), then seniors ($442.00). College students and their families will spend an average of $118.56 on apparel, $57.85 on shoes, $34.52 on collegiate gear, $61.05 on school supplies and $80.06 on dorm or apartment furniture. Spending on electronics or computer-related items is increasing for students ($266.08 on electronics compared to $211.89 last year) as laptops become a requirement for many colleges and universities across the country.

About the Survey

NRF's 2009 Back to School and Back to College Consumer Intentions and Actions Surveys were designed to gauge consumer behavior and shopping trends related to back to school spending and back to college spending. The surveys were conducted for NRF by BIGresearch. The poll of 8,367 consumers was conducted from June 30 – July 7, 2009. The consumer polls have a margin of error of plus or minus 1.0 percent.

BIGresearch is a consumer market intelligence firm that provides unique consumer insights that are gathered online utilizing very large sample sizes. BIGresearch's syndicated Consumer Intentions and Actions survey monitors the pulse of more than 8,000 consumers each month to empower its clients with unique insights for identifying opportunities in a fragmented and changing marketplace.

The National Retail Federation is the world's largest retail trade association, with membership that comprises all retail formats and channels of distribution including department, specialty, discount, catalog, Internet, independent stores, chain restaurants, drug stores and grocery stores as well as the industry's key trading partners of retail goods and services. NRF represents an industry with more than 1.6 million U.S. retail establishments, more than 24 million employees - about one in five American workers - and 2008 sales of $4.6 trillion. As the industry umbrella group, NRF also represents more than 100 state, national and international retail associations.

* Total spending is based on extrapolation of population 18+
** This is the first year the question about how the economy would impact spending was asked.

SOURCE: National Retail Federation