The dog days of summer are here, perfect for sipping lemonade, lazing in the sun and shopping for protractors.
Although the first day of school is a month away, back-to-school sales have been in full swing since the Fourth of July.
Walgreens is advertising its “hot summer deals” right alongside its “Go back happy and healthy” school supply campaign. It’s impossible to navigate Walmart without walking smack dab into bins full of crayons and glue. And the first thing you see when you walk into Target are three giant pencils dangling overhead, pointing the way to its sprawling “school shop.”
For Office Max, it’s like Christmas. Actually, it’s better than Christmas, because consumers don’t stock up on loose-leaf paper in December. The center aisles are filled with back-to-school merchandise, front to back and wall to wall. Cardboard displays made to look like school lockers brim with highlighters, notebooks and pencils. It kicked off its back-to-school sales last month with one-cent pencils and 25-cent crayons, and offered another round of penny deals last week.
Consumers tend to respond to jump-the-gun sales with a collective groan. But retailers swear they have good reason to strike dread in the hearts of students months earlier than necessary.
Because it works.
Starting sales early gives customers more time to shop, more opportunities to spend and gives retailers a better chance at keeping the registers ringing.
If left to their own devices, consumers might not start shopping until early September. But if a store can create a sense of urgency, pushing consumers to think about those supply lists earlier, they’ll likely start shopping sooner.
That has been the case for Kim Johnson of Depew, who has children in fifth grade and kindergarten. School supply sales and ads have caught her eye and prompted her to spend.
“If I see it I think, ‘Oh, I’m already here and it’s a good price, I might as well get it now,’ ” Johnson said.
The store that spurs a customer’s first purchase gets first crack at the consumer’s wallet. And back-to-school spending is no small potatoes – It’s one of the biggest shopping seasons of the year, second only to Christmas. Consumers are expected to spend a total of $75.8 billion this year, up from last year’s $68 billion, the NRF said.
As with Christmas shopping, back-to-school expenses are something families expect and plan for each year. They set aside money months in advance and have been trained throughout the years to get a head start on shopping before inventory dwindles.
Starting in the 1990s, retailers started experimenting, putting seasonal items out earlier in order to beat their competitors to the punch, said Charles Lindsey, a marketing professor at the University at Buffalo School of Management. Since then, a significant portion of consumers have begun shopping for school supplies and school clothing as much as two months before school begins. But was the consumer demand there before retailers began trying to capitalize on it, or did retailers artificially create it?
“It begs the question: chicken or the egg?” Lindsey said.
In the old days, retailers could do little more than guess at how much merchandise to order and cross their fingers that it would sell. At the end of the season, they were forced to slash prices on significant amounts of leftover inventory and take the loss. Now, with more sophisticated inventory systems, stores can better forecast how much merchandise they’ll sell and make more conservative orders.
That allows stores to offer controlled sales at the beginning of the season, strategically cutting prices to get customers in the door. Rather than discounting products because they have to, stores can offer loss leaders – such as Office Max’s pencils for a penny.
The longer the merchandise is on shelves, the more time retailers have to sell it at full price. If stock sells through fast enough, stores can reorder and replenish popular supplies. That’s a more profitable scenario than overstocking something they can’t get rid of.
Stores plan their inventory six months to a year in advance, with complicated logistics that go into choosing, shipping, receiving, marketing and merchandising all those orders. Retailers tend to err on the side of having shelves stocked earlier than later. It helps retailers maximize limited storage space and rotate new items for old ones on the shelf.
Like Christmas sales, back-to-school sales seem to begin earlier each year, said Debbie Goodrich, mall services manager at Eastern Hills Mall. She has heard from shoppers who would rather not be reminded of the impending end to summer so soon.
But it’s nothing compared to the ire she hears from customers when stores put out their Christmas trees too soon.
“That’s when they really start grumbling,” Goodrich said.
Don’t worry, it’s only July. We’ve got at least two months until we have to start worrying about Christmas.