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M&T Bank contributed $62,000 to community organizations to recognize and thank them during the holiday season for the important work they do. Almost 30 nonprofits in the bank’s Northern Pennsylvania region were celebrated at a holiday luncheon hosted by M (read more)

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By Kathy Ruff

Back-to-school and back-to-college spending will reach $83.7 billion this year, an increase of moe than 10 percent over last year’s $75.8 billion tab, according to a survey commissioned by the National Retail Federation.

“Overall, the outlook for back-to-school and back-to-college is pretty positive,” said Pam Goodfellow, consumer insights director for Prosper Institute and Analytics, Worthington, Ohio, which conducted the survey. “We see spending up for both groups of shoppers, back-to-college in particular. In some of our broader economic indicators, we’re seeing increased confidence in an improved economy. That bodes well for retailers.”

The survey shows clothing, electronics and shoes as the expected big winners during the back-to-school shopping season, with school supplies rounding out the list. Yet not all retailers may see added activity from back-to-school purchases, including car dealers, home improvement stores and gas stations.

“We’re looking at a more positive season this year but that certainly doesn’t mean that everybody is going to benefit,” Goodfellow said. “It’s not going to be a slam-dunk for every retailer in the game. Consumers are very discriminate on where they are shopping and what they are getting. They are looking for deals.”

Goodfellow expects consumers to check prices and watch for sales when they shop, creating a competitive retail environment for both bricks-and-mortar and online stores.

“One of the major talking points from this year’s survey we did is that online is still going to be a big player,” she said. “A lot of online shoppers will be looking for free shipping. Buy online, pick up at the store still seems to be pretty popular among consumers. It’s not all digital. Retailers will have the opportunity to drive consumers into the shop.”

When it comes to where parents will shop, the results span a variety of retailers: 44 percent will go online, 40 percent to discount stores, 39 percent to department stores, 34 percent to college bookstores and 29 percent to office supply stores.

For online shoppers, 91 percent plan to take advantage of free shipping and 54 percent will buy online and pick up in-store.

“Discount and department stores, this is a very busy season for them,” Goodfellow said. “We know this is a challenging time for more traditional retailers. With consumers coming out and planning to spend more, they have a better shot at getting that additional share of the wallet.”

Among electronics shoppers, 45 percent expect to buy a laptop while 35 percent plan to purchase a tablet or a calculator. One in four plans to purchase electronic accessories such as a mouse, flash drive or charger.

Observers see a growth in consumer confidence about the economy promoting higher back-to-school spending.

“We know from our consumer confidence survey that consumers are going into this back-to-school shopping season much more confident in terms of how they view the economy currently and their expectations,” said Lynn Franco, director of economic indicators and surveys for The Conference Board, New York. “This is setting up for a good back-to-school season. We’re going in on stronger footing than we did last year. The economy is in better shape.”

While Franco projects both confidence and spending to be strong, she also anticipates consumers to remain frugal.

“We have seen job growth continue and that’s really one of the main factors behind the confidence we have seen,” she said. “The surge in the stock market, in terms of consumers’ financial picture, it’s stronger than it was a year ago. With that said, I think the back-to-school season is a little bit like the holiday season where a lot of purchases are going to be driven by discounting, whether it be in the form of in-store promos, coupons or other such deals. That’s a great motivator for consumers. They tend to look for bargains before making that purchase.”

Purchases via online sales from 2010 to 2017 grew from 3.5 percent to more than 7 percent of total sales, according to Brian Schaitkin, senior economist with The Conference Board, illustrating the continued strength of traditional retail establishments.

“Even though (online sales) are growing, they are still a very small segment of retail dollars,” said C. Britt Beemer, chief executive officer of America’s Research Group, Summerville, South Carolina. “Online does very poorly among blue-collar households. It does better among white-collar and younger consumers under 30. The trouble is those are only certain segments. There are still many others that still shop at bricks and mortars.”

Beemer sees a shift in retail trends and consumer outlooks.

“The last eight years of recession and economic turmoil altered how Americans think,” he said. “Consumers have been extremely cautious. For the last three years, there are fewer young people buying clothes today where they went to school (before) to see what everybody else was wearing and wanted the same thing. The recession pretty much killed that influence of shopping with consumers that were trying to spend less.”

Beemer finds it difficult to project growth in electronic sales for K through 12 as more schools transition away from textbooks.

“More and more schools are going paperless because the cost of buying books is getting to be so much more expensive,” he said. “The problem if the schools provide the computers for the school year, you don’t have to buy one. That’s very different when you’re going to college.”

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