According to the 2024 Deloitte Back-to-School Survey, spending for K-12 students will likely remain flat, estimated to reach a collective $31.3 billion in the United States, or approximately $586 per student this year.
The survey found that parents plan to make the most of early discounts, with 66 per cent of spending expected to occur by the end of July.
The results likely mirror the trend that will take place in Canada this year as well.
Key results of the survey include:
- Surveyed parents plan to decrease their spending on technology products by 11 per cent year-over-year while increasing spend on other categories like personal hygiene and educational furniture by 22 per cent. Spending on clothing and school supplies remains unchanged.
- Shoppers surveyed prioritize retailers offering value and convenience as mass merchants (77 per cent) and online retailers (65 per cent) are top destinations. In search of deals, parents plan to shop across 4.7 retail formats on average, up from 3.9 in 2023, and may sacrifice loyalty to stay within budget.
- Despite financial concerns, 85 per cent of surveyed parents would splurge on their child’s must-have back-to-school products, and 50 per cent would shop for themselves.
- In addition to spending on back-to-school products, 86 per cent of surveyed parents enrolled their children in extracurricular activities and plan to spend $582, including fees and equipment.
- While more parents say their children use Generative Artificial Intelligence (GenAI) for their schoolwork than last year (23 per cent versus 15 per cent in 2023), they are divided on its benefits.
“We expect back-to-school spending to be flat to down modestly when adjusted for inflation, mainly driven by middle-income families juggling financial priorities and ongoing inflation perceptions. Retailers can expect headwinds to volume and loyalty as consumers seek to save money. However, wanting to please their kids, retailers will likely have opportunities to harness the indulgences parents are willing to make,” said Stephen Rogers, managing director, Deloitte Insights Consumer Industry Center, Deloitte Services LP.
The survey also found:
- More surveyed parents plan to make the most of early discounts, with 66 per cent of spending expected to occur by the end of July, up from 59 per cent in 2023. 59 per cent believe the best deals occur earlier in the season, compared to 41 per cent who think they appear later.
- On the hunt for deals, parents plan to shop across 4.7 retail formats on average, up from 3.9 in 2023.
- While 62 per cent of parents surveyed respondents plan to shop within a fixed budget, they may sacrifice loyalty to do so: 67 per cent will shift brands if the preferred brand is too expensive, 62 per cent will shop at a more affordable retailer, and 50 per cent will shop for private labels over name brands, underscoring the need for retailers to offer incentives to keep shoppers engaged.
- Back-to-school shoppers overwhelmingly cite mass merchants (77 per cent) as their most preferred retail format, followed by online retailers (65 per cent) and off-price retailers (tied with department stores at 39 per cent). Overall, seven in 10 surveyed seek convenience (convenient locations, delivery options, and easy returns) — making it the number one driver for where they plan to spend the most.
- Multi-channel retailers account for 80 per cent of the total back-to-school intended spend, up from 73 per cent last year, and 70 per cent of families plan to shop in-store and online, up from 66 per cent.
- Circularity comes to the forefront as more families plan to purchase used items to maximize value further: four in 10 (across income groups) surveyed expect to buy a used or refurbished item this season, up five percentage points among both middle- and high-income families. Technology and apparel lead the charge among pre-owned products (both at 28 per cent).
- Social commerce is on the rise among K-12 parents, with one in three surveyed planning to use social media sites to assist in their back-to-school shopping, up eight percentage points year-over-year. In addition, one in eight plan to make a purchase on social media, up six percentage points from last year.
- GenAI is nascent for back-to-school shopping, with 18 per cent of parents planning to use the technology when purchasing.
- Nearly one-quarter of parents (23 per cent) say their children use GenAI for schoolwork, up from 15 per cent in 2023. However, parents are divided on its benefits: 35 per cent agree that GenAI is a positive tool for academic performance and overall learning experiences, compared to 33 per cent who disagree.
“Families are searching for deals and prioritizing value and convenience to save wherever possible. This dynamic creates an opportunity for retailers to take some of the anxiety out of the season by extending loyalty programs and incentives. In addition, building a seamless omnichannel approach could better position retailers to see consumers coming back throughout the season,” said Brian McCarthy, principal, Retail Strategy, Deloitte Consulting LLP
Nikki Baird, formerly at Forrester and RSR which she co-founded, now VP of strategy and product at Aptos, said the holiday season is always make-or-break for retail. Back to school gets attention as another major spending period, but it doesn’t always get due recognition for the unique role it plays in nurturing consumer trust and delivering on store expectations.
“Shopper emotions run high during the back-to-school season, driven by the nerves kids feel when entering a new school year and the stress parents feel over making that transition as smooth as possible,” said Baird.
“There’s an unmatched opportunity for retailers to play a special role in elevating the sentimental moment that takes place between child and parent in preparation for a strong school year.
“If retailers deliver a subpar experience during the back-to-school season, it will negatively impact their standing when consumers consider their holiday shopping plans.”
Matt Pavich, formerly at Target in merchandise buying, now senior director of strategy and innovation at Revionics, said regardless of how it is defined, consumers are looking for value even if the impacts of inflation are less pronounced than the previous two Back to School seasons. As consumers look for value, they are increasingly less loyal to individual retailers and open to finding value anywhere.
“BTS is a uniquely challenging event for retailers to plan for because it’s highly localized, as the school start dates differ . . . Having an analytics-informed localized pricing strategy is critical to succeeding during BTS. The decision to grow sales during BTS via lower pricing or extra promotions differs by retailer and by products. The best approach for most retailers is to stay true to their brand while leveraging analytics to find opportunities to drive optimal results,” he said.
“Clearance is an often-overlooked element of BTS pricing strategy, but it can be the difference for retailers between a highly successful and a poor-performing BTS period. In many ways, BTS remains a highly tactile in-store holiday due to the tradition of parents and children spending time together trying on clothes, debating what’s cool, and ultimately deciding on items to buy. This offers a great opportunity for retailers to drive traffic and adopt strategies to increase basket sizes during those shopping trips.”
