What about discounting?
With so many consumers seeking value, retailers have been flooding email inboxes with promises of deals and discounts. Last week, the likes of Pottery Barn, Reebok and Nike all sent back-to-school promotional emails advertising discounts of 40%, 35% and 25% off.
“We’re back to a really promotional environment,” said Gabriella Santaniello, founder and CEO of independent retail research firm A Line Partners, noting that in previous recent years, consumers having more disposable income and supply chain issues enabled retailers to “charge more and get away with it.”
Now, retailers are returning to 2019 levels of discounting, Santaniello noted. However, since price points are higher now than they were four years ago, a 40% discount does not represent the same pricing as it once did. Some marketers, such as Hollister, are offering denim jeans starting at $25. Yet that price can’t beat the 25-cent starting price point Target touted in an email hyping some back-to-school items.
“It’s going to be everybody’s on a budget and it’s going to be selective spending,” Santaniello said.
What are the hot trends and which brands are benefitting?
If retailers have yet to roll out their campaigns, they might be missing out already. In the week ended July 25, shopper searches for “back to school” were up 21% on the LTK app, a shopping platform with creators, a spokeswoman reported. LTK found that Gen Z’s top shopping categories for the season include clothing, shoes, accessories, beauty and personal care items and food and beverage products. Hot products from the last year that Gen Z students might still gravitate toward this fall include Lululemon’s belt bag, Steve Madden loafer mules and the Stanley “Quencher” water bottle, LTK said.
The NRF noted that electronics are again a top shopping item. “We see again an increase in demand for electronics,” said Cullen, who theorized that items such as laptops, smartphones, headphones and speakers became more integrated into how students learn and do homework as a result of the pandemic.
Two of this season’s hottest kicks are expected to come from Adidas and New Balance. Santaniello said that Adidas’ Samba sneaker and New Balance’s 574, two vintage-style shoes, are popular this year.
“Retailers cannot keep them in stock,” she said.
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