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Back-to-School Spending Will Rise 9 Percent and Prime Day Is the Reason

Retailers are using Amazon’s mid-summer Prime Day as the starting gun for their back-to-school promotions, and a longer shopping season may translate into higher spending.
Amazon delivery boxes | Source: Shutterstock
By
  • Bloomberg

NEW YORK, United States — The school year is only just finishing across the US, but Amazon.com Inc. is making sure parents are already thinking about back-to-school shopping.

Spending for new clothes and school supplies used to begin in August, ahead of the new academic year. Now, retailers are using Amazon’s mid-summer Prime Day as the starting gun for their back-to-school promotions. This year, Prime Day, which is in its fifth year, will run over 48 hours starting July 15.

In a sign of how Amazon’s event has altered the summer landscape, 63 percent of parents said they will start buying items for the school year in July or even earlier, up from 60 percent from last year, according to a study released Tuesday from RetailMeNot, a digital coupon provider. A longer shopping season may translate into higher spending: This year, they plan to dole out $507 on average for clothing, electronics and other school-related goods, the study found. That’s up from $465 in 2018.

“The key here is that Amazon really has affected the gravitational force in retail,” said Reilly Stephens, director of insights at Retail Prophet, an industry consultancy.

Eighty-four percent of retailers say Prime week has become the most important time for online sales during the nearly three-month back-to-school season, the study found.

When Amazon started Prime Day as a mid-summer shopping event, only about seven other companies joined in to offer competing deals, according to Michelle Skupin, RetailMeNot’s head of marketing and communications. That number has steadily grown to around 200 last year and is expected to reach 250 in 2019, she said.

“Consumers are incentivised to make purchases when presented with the deals. We look at the Prime Day period as being Cyber Monday in July,” Skupin said.

This year, there may be an added incentive to buy early -- Trump’s potential next round of tariffs on everything from apparel to musical instruments haven’t hit yet. President Donald Trump and Chinese counterpart Xi Jinping will meet at the G-20 Summit in Japan.

Adlucent, a digital marketing agency based in Austin, Texas, also noted that Prime Day seems to have noticeably altered consumers’ behaviour.

“Since Prime Day falls right around back-to-school, it has essentially created a second holiday shopping season for consumers to anticipate,” Adlucent said in its report. “So, brands in relevant back-to-school categories have the added perk of drawing on this shopper mindset.”

By Jordyn Holman; editor: Anne Riley Moffat, Jonathan Roeder

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