The 2021 school year will see a return to normalcy with in-person school finally resuming across the country. But what will consumer behavior look like? KPMG’s most recent retail consumer survey, Welcome to the new “back to school” provides some answers.
The survey of 1000 consumers found that average spend per student will be up to $268 per student compared to $247 in 2020, with meaningful change in category spend and variation in educational cohort spending. Additionally, consumers are expecting higher costs due to inflationary pressures.
“The jury is still out on where retail pricing will be for back-to-school merchandise. Although consumers expect net prices to go up, they also think there will be more competition for their dollars, potentially increasing promotional activities,” said Scott Rankin, KPMG U.S Principal, National Advisory & Strategy Leader, Consumer & Retail.
Spending for pre-school and college students, in particular, is expected to spike, up 32 percent and 13 percent respectively compared to 2020. Spending for students in middle school and high school is only expected to be up 3 and 4 percent respectively.
The survey indicated that in some ways the 2021 back-to-school season will be a return to traditional in-person learning categories, with increased spending in key retail categories: footwear (up 21 percent), apparel (up 14 percent) and school supplies (up 16 percent). Respondents expect to spend less on computers and study-related furniture in 2021 than they did in 2020 during the COVID-19 pandemic.
“The prior back-to-school season was a bright spot for retailers concentrated in virtual learning categories, including electronics, computers and furniture. This year the composition of spend is pivoting, with parents once again buying categories aligned with in-person learning and social interaction,” said Matt Kramer, KPMG U.S. National Sector Leader, Consumer & Retail.
Meanwhile, the connected learning experience is here to stay and will supplement in-person learning with digital and online experiences.
“As COVID-19 counts drop, few school districts will stick to 100 percent virtual formats in the fall. Yet, with so many schools deploying some sort of digital content or learning, digital equipment will be a lasting component of back-to-school spend,” said Julia Wilson, KPMG U.S. Advisory Managing Director, Strategy.
This year will set a new baseline of consumer behaviors that preview of future retail trends. Expected trends include the continued growth of online shopping which, while down slightly from 2020, will outpace 2019 (a 30 percent growth); the continued relevance of digital technology in retail spend composition; and increased spending in categories related to in-person interactions, such as footwear and apparel.
The paper also outlines some key advice to clients:
To speak to one of KPMG’s Consumer & Retail experts, contact Melanie Batley.