With back-to-school (BTS) spending expected to reach more than $75 billion in 2016, retailers cannot afford to skimp on marketing and advertising campaigns. The BTS shopping season is now longer than ever — from late June to mid-September — and is the second-biggest shopping event of the year, after the winter holidays.
To succeed during this vital selling season, merchants have to move beyond price-only promotions; they need to employ unique and experiential tactics to engage shoppers. They also need to develop a keener understanding of today’s back-to-school seasonal shifts, and prepare their marketing and merchandising plans to fit consumer demand.
Key trends emerging this year include:
Fewer peak-oriented sales;
The rise of story-driven marketing campaigns, such as those at Target and Kohl’s; and
The growing role of philanthropy and cause marketing within campaigns.
Back-To-School Becomes A ‘Race To Be First’
To accurately build out marketing campaigns for BTS, retailers first have to embrace the growing length of the season, then come to terms with when and where consumers want to shop. “Not just with back-to-school, but with seasonal events in general, there has been what you might want to categorize as a ‘race to be first,’” said Mary Brett Whitfield, SVP at Kantar Retail. “Retailers often think that if they can capture that spending early in the season, they can preempt any purchases that shoppers [who are] in their store today may consider making at other retailers.”
Retailers seeking to win that race are playing catch-up with a consumer base determined to find products at their earliest convenience. In 2016, 58% of consumers began their BTS shopping before August, according to the 2016 Back-To-School Survey from Deloitte.
“Almost every holiday is being pushed earlier,” said Ken Morris, Principal at Boston Retail Partners. “Start with holiday 2016, it used to be November when you’d start to see Santa Clauses and Hanukkah decorations, and it’s so much earlier now. Halloween has been pushed, as has back-to-school, extending every single holiday. If retailers do this properly, it levels their sales numbers to be less peak-oriented than it has in the past.”
Whitfield has separated the majority of BTS shoppers into two evenly split categories: those who shop for deals throughout the summer, and those who shop in one big trip. Consumers beginning their BTS shopping before August are projected to spend 26% more than those starting in August, according to the Deloitte survey, further revealing that retailers may benefit from BTS marketing campaigns that launch as early as July.
“It’s incumbent on retailers to meet consumer expectations if they want to fully capitalize on the spending potential this season,” Whitfield said in an interview with Retail TouchPoints. “Not only make sure deals are present throughout the season, but also to manage merchandise and inventory so that they’ll meet those needs for the shopper that may be inclined to think about it towards the end of the season.”
Target Engages Real Students In TV Ads To Drive BTS Sales
Creating real, meaningful connections with shoppers has been the breakthrough BTS success story for retailers such as Target, which focused more than 90% of its 2015 BTS budget ($28.5 million) on story-driven television ads geared toward students. Further cementing its relationship with students, in 2016 Target is giving high school students the opportunity to serve as creative directors for the brand’s campaign, which includes seven television commercial spots airing nationally.
“Kids were doing storyboards, helping to direct the shoots and weighing in on actual product choices,” said Ani Collum, a Partner at retail consultancy Retail Concepts. “What that does is help the connection with the end consumer, because you know kids are the decision makers, while parents are spending the money. Being able to create that kid-to-kid connection is huge, and at the same time it helps Target differentiate the brand because parents are now paying more attention.”
While not every retailer has the budget for television ads, the key takeaway for every retailer is: Build your own campaigns with the audience in mind; be relatable and provide exceptional customer service.
“It’s not just about being on sale,” said Dwight Hill, a Partner at retail consultancy McMillanDoolittle. “Are they able to ship the merchandise to the customer’s location at a nominal fee? Can they get items that are out of stock on a reasonably quick basis? To me, it really goes back down to these core service tenets, and this is how they set themselves apart from the Amazon’s, Kohl’s and Staples.”
Kohl’s Aims To Bounce Back With BTS Campaign
Unlike a brand such as Target, Kohl’s — in a tale similar to its counterparts Macy’s and JCPenney — relies primarily on apparel sales. With Q1 results not being too kind to the retailer and Q2 results expected in early August, back-to-school sales are likely to be a massive tone-setter for the second half of the year.
“Back-to-school is truly the harbinger of the holiday season,” Hill said. “Any retailer that does not perform well during this period will have to catch up throughout the fall season in order to have a successful holiday. If we see a retailer that has struggled during the back-to-school season, or isn’t as productive as the market would hope, we typically see a deeper and sharper promotional environment going into fall and into the holidays.”
How is Kohl’s dealing with these realities? By building a story-driven campaign designed to “boost every kid’s confidence the minute they put on the perfect first-day-of-school outfit,” according to Michelle Gass, Chief Merchandising and Customer Officer at Kohl’s. The campaign integrates social media, including the hashtag #BigPlans, designed to build conversation around not just the merchandise sold, but students’ back-to-school goals for the upcoming year.
Philanthropy Takes Greater Role In BTS Campaigns
The push to build out story-driven connections appears to be furthering another major component of this year’s marketing campaigns: philanthropy. Target, Staples, Kohl’s and JCPenney all are spearheading charity initiatives within the 2016 back-to-school season, giving consumers the opportunity to give back to national and local community organizations.
Target and Staples are partnering with crowdsourced education funding platform DonorsChoose.org, which will fund up to $5 million of kid-proposed wellness-focused projects in schools throughout the U.S.
Kohl’s is running a cash-back coupon campaign to support AdoptAClassroom.org at the end of July, pledging to donate up to $1 million to the program. From August 1-14, Kohl’s will donate $1 to AdoptAClassroom.org for every Kohl’s Cash coupon redeemed, funding classroom materials for students.
In a similar vein, JCPenney will donate $1 to the YMCA for every pair of Arizona jeans it sells through Sept. 2 for a total possible donation of $250,000, and plans to host a back-to-school community event at a Y located in Los Angeles.
While these examples belong to some of the biggest brands in retail, philanthropy doesn’t have to be exclusive to the industry’s top players. Retailers, particularly SMBs, can partner with local organizations to support causes that matter to them and their consumers.
As more retailers aim to create relationship-building stories to bring them closer to consumers, whether through their philanthropic campaigns or their advertising campaigns, brands should never forget to make the experience fun — for the consumer and themselves.
“Brands such as Target, Best Buy and Office Depot are all doing some fun tongue-in-cheek commercials to bring a lighthearted approach to back-to-school, and also help capture attention,” said Collum, of Retail Concepts. “When you’re running a standard 15% off campaign, it’s very easy to get lost in the shuffle there. So these brands have to think outside the box from a marketing perspective to get people’s attention to what they’re saying.”