Back-to-School: Good News for Green Products, Discount Retailers

On Monday Deloitte announced survey results indicating that although economic concerns continue to affect shopping plans, fewer consumers expect to reduce spending on back-to-school items compared to last year.

“Consumers may be casting a glimmer of hope for retailers, but the survey results indicate that value will top their shopping lists this year,” said Stacy Janiak, vice chairman and U.S. Retail leader, Deloitte LLP. “Although retailers may not see as many wallets snapping shut as they did in late 2008, consumers still plan to stretch their dollars, telling us that that their shopping remains constrained. Retailers should focus on delivering the best incentives and in-store experiences to get the most out of the back-to-school season this year.”

In addition to general inflation-related concerns for keeping back-to-school spending under control, consumers surveyed by Deloitte cited additional reasons for spending less this year:

  • 22% indicated a loss of job in their household
  • 17% expressed fear of a job loss
  • 32% said they are saving more (up 10% from last year)
  • 33% are paying down debt

Those who said the economy was weak or in a recession represented 85 percent of respondents, down 10 percentage points from last year. Fourteen percent currently believe the economy is starting to recover.

Discount Stores Rejoice

The winners in this recovering-but-not-quite-there economy may be discount retailers. At least if you believe the 90 percent of respondents who indicated they will do their back-to-school shopping at discount/value department stores.

Other changes for those polled included:

  • Buying more items on sale
  • Buying only what their families need
  • Buying more lower-priced back-to-school items
  • Using more store coupons
  • Shopping at different (less expensive) stores than they usually do
  • Buying private label brands
  • Comparison shopping online 
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What’s Getting Cut?

As you can imagine, clothing will be hit the hardest (81% of people say they’ll cut back on clothes), followed by shoes (49%). School supplies and backpacks take less of a hit, but around a third of respondents said they’d be cutting back on both of those as well.

“In today’s tough environment, retailers’ principal marketing strategies should include coupons, sales and loyalty programs,” said Janiak. “And with more than three-quarters of shoppers expecting to do the bulk of their shopping in August, retailers can implement promotions now that may encourage customers to spend a greater share of the back-to-school budget in one place. Campaigns that are both strategic and creative, such as mobile alerts or coupons, can target a specific customer segment, better engage shoppers and build loyalty.” 

Green Brings in the Green

The survey pointed to consumers’ continued interest in the green category. More than four in 10 (41 percent) survey respondents said they will likely seek out “green” products this back-to-school season, and more than three in 10 (31 percent) said they will likely seek out green retailers, both numbers remaining steady from 2008.

“Given the importance of understanding what consumers value, retailers should consider how they might be able to capitalize upon the sustained interest from their customers in not just eco-friendly items but practices that define the company, such as store design, materials and energy efficiency.”

For more information about Deloitte’s Retail sector, please visit www.deloitte.com/us/retail.

Image Credit: laffy4k, Flickr

  • Jenny Woo

    “Given the importance of understanding what consumers value,…”

    great article. and let’s not forget the importance of security for onine retailers. I am looking for extended validation ssl on every site I shop at, the “GREEN” url bar proving the site has been certified as trustworthy. Buy green, keep your green and look for the green. my favorite color!

  • “Given the importance of understanding what consumers value,…”

    great article. and let’s not forget the importance of security for onine retailers. I am looking for extended validation ssl on every site I shop at, the “GREEN” url bar proving the site has been certified as trustworthy. Buy green, keep your green and look for the green. my favorite color!
    P.S. – Sorry, forgot to tell you great post!