With schools and offices finally back this week, we are finally seeing some measure of the ‘old normal’ returning. This will come as a relief for brands and retailers targeting the lucrative back to school market. It was worth £1.7bn last year, according to GlobalData. However, like so much of the rest of the economy, we are seeing huge differences in how this market operates in 2020.
The home has been the new setting for schooling for most of this year and many parents remain nervous about sending their children back. There is even a strong possibility 2021 exams will be pushed back by several months with children losing so much time from the classroom. So with the school gates re-opening, what are the key trends those targeting the back to school market should take notice of?
Consumer electronics serving at home studying
When the lengthy lock down first hit, parents across the country collectively groaned. Their next move was going online to buy consumer electronic equipment. Laptops were needed for living rooms that had now become classrooms. In fact this category has been one of the few winners of the pandemic. While most sectors are significantly down, Electricals 2020 sales growth of 0.7% is predicted for the year, according to Retail Economics. Notebooks have been at the centre of a demand surge in particular. 73% of retailers have reported growth in sales for these products on the back of home learning. Looking to the future the momentum is likely to be maintained. A recent opinion poll by Redfield and Wilton Strategies suggested just two-thirds of parents were preparing to send their children back to the classroom with many remaining unconvinced schools are safe. If cases spike there could be a return to at least some element of home schooling which will necessitate further demand for these products.
Instore retail figures confound expectations
Recent retail figures have confounded expectations with a huge pent up demand now being met. Retail sales volumes rose a better-than-expected 3.6% in July and are now above pre-pandemic levels. Data from the Office for National Statistics showed that sales rose 2% ahead of a 0.2% prediction by economists, and a 13.9% bounce in sales in June. Relating to the back to school market specifically, clothing will still be a driver during the historical peaks of July, August and September. However stationary and tech products have been in demand during lockdown as both children and adults have been at home, with discounts readily available to take advantage of. The latest GDP figures also showed Ireland which is slightly ahead of the UK’s “return to normal” steps has shown positive precedent of customers returning to retail to buy their laptop and other back to school equipment and seek expert advice to do so.
Shopping with purpose
Connected to this, a clear new trend is people ‘shopping with purpose’. People are looking to make less retail trips but ensure they have something to show for it. Parents are looking to buy equipment for back to school and still need expert advice. However at the same time they will want to minimise unnecessary journeys with coronavirus still circulating. While there is a good chance of closing a sale from a consumer’s instore visit, it can also present some challenges. Many retailers will have a strategy to retain stock at their central locations to service online orders first. They will also encourage stores to process click and collect or web orders for customers. Therefore there is limited opportunity for instant gratification – often the reason a customer visits physical retailers. Therefore retailers should ensure they can match the needs of customers to make sure they avoid a wasted journey. The feedback is likely to be far more negative if they can’t source what they need on a trip out in 2020.
Promotional activity still strong
Brands and retailers should certainly not skimp on promotional activity during back to school. As we have identified there is a large amount of pent up demand and parents are out in larger numbers looking to purchase. Brands that offer customers what they need on these ‘purpose-driven’ visits can succeed. With lots of competition brands should ensure they are still offering promotional activity to attract new customers. Many brands and retailers have strong offers to tempt sales. For example Dixons are offering consumers a 1-in-20 chance to win money back on laptop purchases of £349+. They are also offering Buy now pay later also on devices £349+. Additionally John Lewis have run an “Off to Uni” online event showcasing needed items.
Knowledgeable staff key to capitalising on purpose-driven trips
Having staff who can influence a sale was critical before the pandemic and is now more vital than ever. With so many hardware options out there for pupils, it is vital that instore staff and those on the telephone can advise and sell parents the products that meet both the needs of their children, but also are compatible with their schools. One really interesting trend we are seeing is a +40% conversion rate of product demonstration leading to a sale. The potential for high conversion rates on purpose-driven trips highlights how critical it is to have knowledgeable staff on hand.
Schools may have been out for Summer (and Spring), but now they are back, brands and retailers need to meet pent up demand in these uncertain times. Those that help hard pressed parents meet their children’s’ educational needs will reap the rewards in good will and sales.
To read the full article please visit The Drum