Back-to-school is one of the biggest seasons for many retailers, with an average mean spend of 26.9B between 2013 and 2019 according to eMarketer. This year, the COVID-19 pandemic has thrown a curveball to the world, impacting economy, consumer spending, shopping and shifting many habits and attitudes. While this year is on track to be the most unpredictable in recent years, and will continue to fluctuate, here are a few things to consider now:

Timing: Return to the classroom

Year-over-year, the Back-to-School season is consistent, with most US students going back between mid-August and early September. In recent years, the back-to-school shopping season was kicked off by Amazon’s Prime Day in July, and the mid-summer timeframe was the most popular time for parents to shop for back to school items. In 2019, almost 71% of consumers had planned to start shopping at least three weeks before the new school year began (NRF).

This year, Prime Day is postponed to September and local school districts, colleges, and universities don’t know if and when students will return to the classroom. Many school districts and higher education institutions plan to return in the fall, but for many in highly populated and hard-hit areas, that may change.

In a recent poll conducted by Dentsu Aegis Network,  30% of respondents  said they wouldn’t start back to school shopping until the return to  the physical classroom date was announced, whereas 26.8% of respondents indicated they would start shopping in July.

Supply Chain Disruptions

With the worldwide disruptions resulting from COVID-19, it’s projected that supply chain delays will linger for months, threatening not just the back-to-school season, but the holidays as well.

Many goods, including apparel, shoes, and electronics are manufactured in China (roughly 20% of retail chains). While spring and summer goods were shipped before the disruptions associated with COVID-19, goods imports fell 2.3 percent to $193.7 billion in March, the lowest since August 2017 (Reuters) so it’s expected shelves won’t be full this summer.

Spending and the Economy

The impact of this global virus on the overall economy will be larger than anticipated. A monthly Wall Street Journal survey found economists expect the GDP to shrink 6.6% this year, measured from Q4 2019. That is a downgrade from the 4.9% contraction economists predicted in the previous month’s survey.

Consumers spending habits have shifted and have become more conservative and focused on health, wellness, and essential items. As of April 27, 50% of Americans have cut back on day-to-day purchases as a result of the pandemic. According to Harris Poll, 64% of Americans say  their shopping habits  have changed as a result of COVID-19, and will continue to change even after the pandemic is over.

Based on our Dentsu poll, most respondents anticipated spending the same amount this year as last year. While the per student spend may be consistent with previous years, we may see a drop in the total number of shoppers.

Product demand

Last year, clothing and accessories represented most of back-to-school shopping (demand and planned category spend). While almost all shoppers expected to purchase supplies, it was the smallest average spend. And almost 54% of the shoppers planned to make a purchase of electronics and/or computer hardware (Deloitte).

This year, we may see an uptick in electronic purchases as some students or districts lean more on remote learning. Parents who might not have purchased spring school clothes, may spend a little more on outfitting the kids when they return to school presumably in the fall.

Some universities and colleges are anticipating a decrease in campus living. Moody's expects college enrollment to drop in the US through next year and many college students, due to financial or health concerns, may decide to commute rather than dorm. This will lead less dorm room shopping for incoming freshman.

In-store vs. Online

Last year, shoppers expected to spend 56% of back to school budgets in-store (Deloitte).

This year, while many retail stores are starting to reopen, or have announced plans to re-open, traffic has been significantly down. Cowen and Company estimated total traffic to clothing retailers specifically had plunged 99.3%. Not all consumers will be rushing back to shop in-store. As of May 3, 49% of Americans have indicated having more of a preference towards online shopping as a result of COVID-19 and As of April 27, 31% of Americans expect to continue shopping online more frequently once the outbreak is over, and 30% believe they will visit stores less frequently (Harris Poll/GWI). While a complete elimination of in-store shopping is unlikely, we anticipate continued increase in online shopping this year.

What Marketers Should Do

So, what does all this mean for marketers and retailers looking to finalize their plans for Back-to-school? In a nutshell – be agile because the 2020 shopping seasons will continue to evolve. Here are a few things you should be doing:

Geographical targeting

*At the time of this post, the start of the fall 2020 school season is still to be decided in many areas

A geographical approach will be more important than ever for retailers, especially national retailers. One approach will not work for every state, county, and district.

Stay Informed

In order to appeal to the various geographic areas - understanding the needs and current status of these areas will be the first step. Not just knowing when and if students return to the classroom is enough. Knowing what schools will look like for students and how retailers can provide what students need to be safe and productive is crucial.

Contingency is Key

2020 will also be the year for contingency planning. With supply chains disrupted, retailers need to be agile. Sales and promotions will not be business as usual and any experiential plans around this season may need to be adjusted. Suppliers may not be able to keep up with demand, thus creating a need for retailers to shop around.

Contactless Commerce

When consumers venture out, they will want, and expect, a safe shopping environment. While many essential retailers have already put into place safeguards and procedures, retailers that are just opening will need to address this as well. Curbside pickup and contactless credit card payments will be much more prevalent moving forward.

The pandemic and consumer response is fluid, and will continue to evolve.