Analyzing how COVID-19 has affected Back-to-School arrivals, discounting and fashion trends.
As of July 18th, UNESCO reported over 60% of the global student population are out of lessons as homeschooling and online learning are the new norm. Whether schools reopen or not in September, Back-to-School (BTS) shopping habits and retailers’ assortments are looking different than initially planned.
Even without the hangover of a global pandemic, this is a notoriously tricky event for brands to nail. With 68% of parents planning to start shopping at least three weeks before school begins, we’ve rounded up an early read of the market combined with the impact of COVID-19 on arrivals and discounts to help retailers win the BTS period.
For tailored support on how your team can harness the power of market intelligence, reach out for an EDITED demo here.
Retailers are cautious with arrivals, but consumers are still hungry to spend
Newness has taken a back seat with 2020 arrivals experiencing staggering YoY declines market-wide. Childrenswear is no exception. Charting the past four years of online product drops over the BTS period reveals June and September as the peak months for deliveries. This year, it’s clear to see retailers have held off on dropping newness at the same levels as previous years with arrivals from the start of May until mid July are down 46% YoY. And there’s a reason for retailers to be conservative.
While NRF data forecasted coronavirus uncertainty could lift BTS spending to a record level, with total spending for K-12 and college combined projected to reach $101.6 billion, parents will be prioritizing technology over apparel to ensure children are equipped for online lessons. Parents with children in K-12 plan to spend less than they did in 2019 on clothing, which is down slightly to an average of $234.48 from $239.82 last year. For college shoppers, apparel spend is forecasted to stay flat YoY at $148.37.
This makes it more essential for retailers to perfect their 2020 offering and advertising by investing in retail market intelligence to understand where there is an appetite for spending. Despite fewer products in the market and the predicted drop in spending, the number of new items selling out for the first time for US children online since the start of May in the mass market outpaces 2019 by 36%, indicating there is still consumer demand for newness in this area.
Products selling out are seeing a shift given the current circumstances with comfort and essential styles at the fore. Shorts, sweatpants and leggings all make up a higher percentage of sell outs within the bottoms category than jeans. Denim, generally a BTS big seller, is still gaining traction with retailers communicating stretch properties and soft hand-feel.
What trends and markets are poised for growth?
The COVID-19 pandemic has also opened up opportunities for expansion into new categories. Is your BTS assortment catering to any of these?
Ranked as one of our best-selling products of Q2, masks and shields will continue to be important now face coverings are a requirement in a lot of public places. These have been adapted for children with playful colors and prints to make the idea of wearing a mask more appealing. There’s also opportunity with alternative face coverings such as scarves and snoods to take into fall while bandanas have been popularized on TikTok, appealing to that generation of consumers.
Technical fabrics & features
Antibacterial fabrications and hygiene technology will only continue to amplify as the world reopens and parents will be looking to add protective measures within their children’s garments. In the UK for example, Marks and Spencer already offers antibacterial finishes on its school shirts. For the US where uniforms aren’t compulsory, retailers should also consider these kinds of properties for products that see repetitive exposure such as gym and sports apparel, gloves, scarves, hats and school bags.
There is also an opportunity to incorporate these properties into denim. Diesel has just announced a partnership with Swedish chemical company Polygiene – a selection of the brand’s Spring/Summer 2021 styles will include a finishing treatment that prevents 99% of viruses, including those that cause COVID-19, from attaching to the fabric. In addition to antibac technology, retailers have been focusing on communicating products with attributes such as non-iron, stain and scuff resistant capabilities, extra stretch, reinforced knees and adjustable waistbands to extend shelf life and offer more value for money, resonating with consumers tightening their purse strings during these uncertain times.
Athleisure has always been a core trend for BTS, so homeschooling and the rise of loungewear has propelled this trend even further, solidifying comfort dressing as the new school uniform. In addition to the previously mentioned stretch denim, retailers have emphasized comfort through ergonomic details: elasticated waists, cuffed ankles on trousers, softer linings and lightweight fabrics such as fleece and Pima or organic cotton.
Blue light glasses
With online lessons exposing kids to more screen time, blue light glasses have emerged as an accessory to invest in for the COVID era learning.
Market to watch: Adaptive apparel
Amid the growing conversations surrounding diversity in the fashion industry, more retailers are recognizing the need to offer more inclusive adaptive clothing that is accessible, medically safe and fashionable. Emphasis on ‘throw on’ designs will be key, as will any design details that make dressing children easier such as wheel-chair friendly cuts, magnetic and velcro fastenings and adjustable & elasticated waistlines.
The resale market holds vast potential for schoolwear with kids growing so fast, coronavirus drawing more attention to sustainable fashion and unemployment rate spiking. Lost Stock, an initiative to support Bangladesh garment workers and their families during the coronavirus pandemic by selling a box of canceled stock orders destined for landfill, has just ventured into kidswear. Offering families value for money and supporting social causes, retailers could consider the introduction of partnerships with resale or second-hand businesses. For inspiration, look to the Selfridges and Kidswear Collective collaboration, which provided customers with re-worn pieces at discounted prices.
The absence of Prime Day drove July discounting proportions upwards
Amazon Prime Day (last year was held over two consecutive days) traditionally signifies the start of BTS shopping. Retailers have caught on and have offered sales of their own to win back consumers. With the e-comm giant’s famous sale rescheduled to October, how is BTS discounting impacted?
Firstly, we’ve determined retailers are discounting a higher proportion of products YoY, potentially driving the increase in the number of sell outs mentioned above. With Amazon also running its Big Style Sale from Jun 22nd to Jun 28th, retailers had a greater incentive to reduce products earlier to compete. Over these days, US mass market retailers discounted on average 71% of products which continued into July, outpacing the proportion of products reduced over Prime Days last year where 62% of products were marked down.
But retailers are preserving margins to survive the challenging retail landscape
With businesses recession-proofing their discounting strategy during the coronavirus pandemic, retailers are offsetting the high proportion of products marked down with a lower discount average to protect their margins. This strategy is also in place for BTS products. Last year over Prime Days, products were discounted on average at 43%. This year, it’s been pulled back to 30%. Over Amazon’s Big Style Sale days, competing retailers discounted at an average of 32%.
Addressing both in-class and on-camera learning dominates messaging
As retailers’ promotions of the event start trickling into consumer’s inboxes ahead of the new term we unpack the key trends within customer communications. Promoting merchandise that can be worn in both the classroom or at home has been the overarching theme, with retailers such as GAP, Macy’s and Dick’s Sporting Goods tailoring emails that speak to parents sending their kids back to school or carrying on with online learning.
Denim continues to be a key communication story, particularly at retailers where the fabric is its bread and butter, such as Abercrombie & Fitch and GAP, highlighting again stretch and comfort capabilities. Discounting remains a popular message with Target calling out value packs and price-pointed sales while Marks & Spencer are promoting blanket offers. Pledging support for social causes was also a key theme. Burton Snowboards will advertise a ‘buy one, donate one’ for every backpack purchased until Aug 8th, where one full year of school supplies will be donated to the Kids in Need Foundation, supporting families struggling with extreme poverty. Though not explicitly tied to BTS, Loft brought back its Pride collection supporting GLSEN, an organization focused on ensuring a safe school environment for LGBTQ+ students. Both are examples of endeavors that require year-round support, which are important for businesses to address to comply with the expectations set by the new consumer types emerging from social activism who will be aligning themselves with brands that share their values.
For more of the latest industry analysis, sign up to our weekly Insider Briefing to get these reports and more directly in your inbox.