Like inquisitive classroom students, parents want answers when it comes to how much products will cost this back-to-school (BTS) season.
Retailers have been on the offensive dropping prices around food and grocery staples, and they will likely follow up with savings on notebooks, crayons, folders and more for the BTS season. In fact, Target, Walmart and Amazon have already begun releasing early deals to get out in front of concerned parents.
But what does this mean for consumer goods brands and partnering retailers? How can they effectively reduce prices, move volume and maintain profits?
BTS by the numbers: Expecting slow growth in 2024
Parents take BTS shopping very seriously, looking to save money where they can while managing a long list of items to procure. For example, even though most parents and students don’t receive their official school supplies list until August, more than 20% of shoppers begin shopping for items as early as June, according to research from the National Retail Federation (NRF). The association also reports that many consumers plan around Amazon’s Prime Day and special retail events to do their school shopping.
BTS shoppers are a focused group, but sales might be down this year, according to a study by eMarketer. The analysts say:
- Retailers are expected to generate $81 billion in sales during BTS this year, but the sales growth is slow compared to the overall total retail growth, down 3% comparatively from the year before.
- Even still, BTS produces the second-highest shopping volume of the year.
For a look at how shoppers view the BTS season, Field Agent surveyed 1,250 shoppers and learned:
- Roughly 40% of respondents expect to spend more money on items this year.
- 70% believe prices will be higher due to inflation.
The season will be productive for brands and retailers, but it’s clear BTS shoppers are cautious about spending.
Brands optimize results with predictive analytics
Industry surveys are a nice way to get a feel for consumer sentiment or market projections, but predictive analytics accurately tell brands how their products will perform days, weeks and months ahead into the BTS season — and by item and by store.
BTS brands can leverage price elasticity models to refine their pricing strategies and engage AI-powered solutions that identify the most effective promotions to run. Consider these examples:
- A consumer brand that specializes in pens can see if consumers are expecting to trade down in the category. Instead of buying a premium pack of gel pens, shoppers might be trading down to a store brand or value brand pack of ballpoint pens. Predictive analytics can uncover unique trends such as this for the season.
- A backpack company can see ahead into how specific trends might fare, testing scenarios around product attributes such as number of pockets, lightweight vs. durable materials and more. Predictive analytics empower brands to study the most effective product trends among BTS shoppers and can pivot accordingly to get the best assortments in stores.
Historically, BTS shoppers like to make a family trip to the store and stock up on school supplies. But CPGs can also look deep into shopper data and trends ahead such as seeing if more shoppers will manage school supply shopping online and pick up in-store.
AI solutions can help brands prepare for how customers will shop BTS and help retailer partners make the most of the season.
CPGs earn top honors with Insite AI
Retailers rely on brands to bring expert insights on how their products will perform during the BTS season. The CPGs that highlight what products are expected to sell, at what price and with recommended promotions will earn trust that goes beyond the school months.
Become a category leader by delivering predictive insights to retailer partners and winning the BTS season. Contact Insite AI to see how your brand can be at the head of the class.
