If you’re a small retailer and you’re not rubbing your hands together in glee right now, maybe you should be. Back-to-school—the second-biggest shopping season of the year behind the winter holidays—is here.
The National Retail Federation’s (NRF's) "2014 Back-to-School Survey" predicts that the average family will spend $669.28 this year outfitting young students with clothes, shoes, school supplies and essential electronics, an increase of about 5 percent from last year.
Back-to-school is especially lucrative for brick-and-mortar retailers: A survey by Merchant Warehouse found that 69 percent of consumers typically buy back-to-school items in stores. And the NRF reports that about 18 percent of consumers plan to support small, independent businesses when shopping for school this year.
Merchant Warehouse also reports that back-to-school is an opportunity both to gain new customers and to enhance customer loyalty … right before the crucial holiday shopping season. If you're trying to grab your share of this lucrative market, here are six opportunities you can take advantage of.
1. Focus on Pricing
A whopping 85 percent of consumers in the Merchant Warehouse survey say they shop at the same retailers year after year for back-to-school clothing and supplies. However, 91 percent say they’re “likely” or “somewhat likely” to try a store they don’t typically patronize if they’re offered a discount or reward.
Money is the most effective reward: 53 percent of those surveyed would switch retailers if given a price incentive. Four in 10 say they’re more price-sensitive during the back-to-school shopping season than at other times of the year, and 45 percent say they’re more driven to shop at a retailer based on its sales, discounts or promotions during the back-to-school shopping season than at other times of the year.
2. Offer Loyalty Programs
Back-to-school is a great time to capture consumers’ loyalty just ahead of the holidays. Merchant Warehouse’s study found that 66 percent of consumers are likely to sign up for a retailer’s loyalty program during a back-to-school shopping trip if they’re offered a discount at checkout. If you don’t already have a loyalty program, there are many options available for small businesses, and keep in mind, customers don’t want paper punch cards—they prefer plastic loyalty cards (or, if they’re college kids, smartphone apps).
3. Don’t Forget the College Market
Back-to-school is more than just paper, pencils and uniforms for the K through 12 crowd. In fact, college students are where the real money is, the NRF reports, since college students buy more expensive items than younger students. All told, the NRF study says, the average college student will spend $916.48 on back-to-school—up 10 percent from last year.
College students also buy a broader range of items than younger students, which makes them a target market for a wider range of businesses. For example, they’re more likely than younger students to purchase dorm furniture and bedding; home electronics, such as coffeemakers or mini-fridges; cleaning and laundry supplies, such as dust-busters and irons; and computers or tablets. That means furniture stores, kitchen supply stores or home furnishing stores can stand to profit from back-to-school as well.
4. Keep It Simple
College students and their parents are dealing with enough stress already—they need things to be as simple as possible when it comes to outfitting a dorm or apartment. Make it easy on them by stocking your store with a broad array of items, creating "bundles” or packages of products and offering low-cost shipping.
Providing low-cost shipping and selling all the things students need in one place has helped DormCo, an e-tailer of specialty dorm products founded by Jeff Gawronski in 2010, grow to a projected $6 million in revenue this year. The company uses Instagram for marketing and sells everything college students need to create a home away from home.
5. Get Social
Whether you’re selling to millennial college students or Gen X moms of kindergarteners, social media is key to attracting new business. Trendy social channels such as Instagram, Twitter and Snapchat will work to reach college students, while moms generally hang out on Facebook. Make sure your social media posts are also tailored for mobile, where moms and millennials spend most of their time.
Speaking of mobile, using text message marketing is a great way to appeal to college students, while email marketing messages tailored for mobile consumption will appeal to their moms.
6. Start Now
About 25 percent of the parents of K through 12 students in the NRF report say they'll shop one to two weeks before school starts; 44.5 percent say they'll shop three weeks to one month before school starts; and 22 percent will do their shopping two months or more before school starts. So spread out your deals throughout the season to capture the maximum number of buyers. (However, if you’re targeting college kids, keep in mind, they’re less likely to wait until the last minute, since they're more likely to be dealing with cross-country moves.)
A few smart moves can help you draw in the back-to-school crowds and turn up the heat on your summer sales.
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