The fashion brand Kate Spade is most known for luxury handbags. But it is also banking on gold-accented staplers, monogrammed planners and $30 ballpoint pens to help buoy sales during the increasingly important back-to-school shopping season.
The discount retailer Dollar Tree is also expecting students and their parents to lift sales, particularly after an unusually weak second quarter. But instead of fancy notebooks, it is focusing on the other end of the price spectrum, like $1 packs of tape, glue sticks and pencils.
As the income gap in the US has turned into a chasm, luxury and discount retailers have become increasingly deft at attracting people at the separate ends of the income spectrum. Stores positioned for the middle, like traditional department stores, have struggled by comparison.
These days, that divide extends more than ever to what students wear and carry with them to their school lockers. “Both luxury retailers and value stores, like dollar stores, are benefiting right now from the back-to-school trend,” said Jharonne Martis, a retail analyst with Thomson Reuters. “They’re really benefiting from their core consumer.”
Parents spend an average of $673.57 on electronics, clothes and notebooks this year, compared with $630.36 last year, according to the National Retail Federation, an industry trade group. In total, parents of kindergarten through 12th-grade students say they will spend $27.3 billion on school supplies this year, up from $18.4 billion in 2007.
The back-to-school season is the second-biggest shopping period of the year, behind Christmas. But while families will spend more than before, how they will do it — and where they will do it — varies widely.
A growing list of designer notebooks, luxury desk accessories and even beanbag chairs now caters to wealthy back-to-school shoppers. Shoppers can buy a $195 Gucci headband, a $572 Versace backpack and a $28 Terez pencil case on the back-to-school section of Saks’ website.
Restoration Hardware has a new “teen” line that includes a $2,000 “riveted aluminium” desk and $250 faux fur beanbag chairs. Martis said she expected Kate Spade’s desk accessories and stationery products to be a big focus this season, projecting that sales would rise 7 per cent this quarter at stores open at least a year.
But back-to-school items are also expected to buoy sales at discount retailers like T.J. Maxx, whose appeal is increasingly wide and which aim at the growing number of poor students and families in the US.
In 2007, about 9 million state school students came from low-income households, according to the Department of Education’s National Center for Education Statistics. In 2014, there were more than 11 million, according to the most recent data. Some of these families rely on backpack drives and other support from non-profit or community groups.
Many, though, are left seeking the best deals. Retailers, including the discount stores, have responded by pushing bigger promotions earlier in the shopping season.
That, in turn, has seemed to push people to do research on their own: Back-to-school search queries rose sharply the week of July 11, a full week earlier than last year, according to data released recently by Google. Some stores have also used tax-free holidays to encourage shopping. Wal-Mart, the world’s largest retailer, provided a list of tax-free holidays by state, along with all the school-related items to which they would apply.
Retailers who cater to middle-class consumers have been struggling, slashing prices in what has become an aggressive race to the bottom. Sales at traditional department stores have slumped, and once-mighty institutions like Macy’s and Sears have had to close stores.
Some retailers have cast a wider net. Jamie Nordstrom, president of Nordstrom stores, a legacy department store trying to adapt to new consumer tastes, said it had found consumers to want a variety of prices. So for back-to-school, the retailer offers a mix: a $495 Burberry girls’ cross-body bag, next to a $32 backpack and a set of $17 gel pens.
“We don’t think about it as a high-end shopper and a low-end shopper,” Jamie Nordstrom said. “Most people, as they’re living today, they’re wearing high-end and low-end at the same time.”
Supply lists can vary widely — it is not uncommon to see USB flash drives, graphing calculators or pocket dictionaries in many wealthier districts. And budget cuts have forced many schools to rely more on parents for what would once have been considered essentials: things like construction paper, tissues or pencils.
Factor in extra-curricular activities and the difference between the money spent by high- and low-income studentsis even starker, said Brent Wilder, the corporate public relations director for Huntington National Bank.
This year, Huntington estimates that the families of elementary-school-age students will be expected to pay for an average of $659 worth of supplies and fees, while high school students will need $1,498. That is up from $351 and $894 in 2007, the first year the bank began doing the survey.
The expenses can go much higher, though. “I’ve seen districts that have $1,500 band fees,” Wilder said.
But the point of the survey, he says, is to make sure people — especially at the lower-income levels — know what they will be facing. “We really wanted to highlight to consumers in our markets that this was an expense that they needed to plan for,” Wilder said. “They literally cannot afford to buy classroom supplies and pay all of their bills if they don’t plan ahead.”
