Retailers hope back-to-school season will boost spending

It's the height of summer, but inside many Baltimore-area stores, fall has arrived.

While shoppers sorted through racks of discounted shorts and tank tops, retailers at White Marsh Mall began displaying school backpacks and uniforms. Area Target stores offered plenty of summer picnic gear but devoted extensive display space to notebooks, pencils, folders and glue. And while some consumers said they can't think about school purchases until after family vacations, office supply stores such as Staples began promoting back-to-school computers, laptops and iPads.

After a disappointing start to summer for some retailers, many hope for a boost from back-to-school shopping, the second-biggest sales period of the year. But consumers, weighed down by economic woes such as high unemployment and elevated gas prices, likely will wait for last-minute sales, comparison shop more than usual or just make do with what they have, some experts said.

"Most middle-income consumers are going to be very selective in what they purchase," said Ken Perkins, president of Retail Metrics, a Boston-based research firm. "Consumers are still feeling cautious and uncertain about where things are headed. For a vast majority of households, they're going to buy what they need and not a lot beyond that."

Tanasha Siena, an Edgewood resident whose family was reduced to a single income when she began staying home with her 16-month-old son, said rising costs for food and other necessities have made her even more price conscious. When it comes to getting her 13-year-old son ready for eighth grade, her strategy is to buy only what he needs, supplement with leftover school supplies and shop at off-price chains such as Marshalls to get brand names at a discount.

"I'd rather dig through the racks" to find a bargain, Siena said. "As they get older, it's more expensive, because now I'm buying men's clothing and men's shoes, and $120 calculators. If I see something on sale ... and I think the price is good, I'll get it."

Though the season that starts as early as July and runs through mid-September is less of a make-or-break time for retailers than end-of-year holiday shopping, it's still important to discounters, department stores, teen and children-oriented specialty shops, and electronics and office supply merchants.

U.S. retailers were expected to have back-to-school and back-to-college sales of $68 billion last year, four to five times the sales typically generated by the next-biggest annual holiday, Mother's Day, according to the National Retail Federation. The group, which has not yet released a 2012 back-to-school forecast, had said the average family with students in kindergarten through high school would spend about $600 last year, about the same as in 2010.

To drive spending amid low consumer confidence, retailers have been discounting more than usual this summer, said Nancy Liu, a retail strategist at Kurt Salmon in New York.

"I think a lot of retailers are looking toward back-to-school and back-to-buying," Liu said. "Retailers are hoping to see a resurgence as consumers are forced to go back" to stores.

To bring shoppers through the doors, retailers are expected to compete with heavy promotions and discounts.

"It's a crucial selling season for them, and they are going to do as much as they can to leverage it and drive sales in their stores and online," Perkins said. "It will be a pretty promotional back-to-school shopping period. Retailers will have to be aggressive in markdowns and offering incentives for consumers to come in."

"Door-buster" deals from Wal-Mart Stores Inc. and other retailers have started, with deals such as packs of pens and crayons for a penny — until supplies run out.

"These things are used to get people through the door, and it works," said Maggie Miller, a frugal living expert and blogger from Centreville in Queen Anne's County.

More consumers are becoming aware that competing retailers often will match a low price if shoppers bring them a circular advertising a sale, Miller said. "More and more people are price-matching. The trend is to save more money now because people are so worried about the economy."

Denise Ruby, a Bowleys Quarters resident shopping Wednesday at White Marsh with daughter Megan, 13, said she'll likely take her to some favorite stores — Aeropostale, Hot Topic and Spencer's, but will look for sales and stick to a budget. And she's in no rush, preferring to wait until closer to the start of school.

"I have a certain amount of money put away for school purchases — and that's it," Ruby said.

Retailers can only hope that the improving optimism noted by one forecast released last week pans out. According to a consumer survey by PriceGrabber, a website that tracks and compares retail prices, 63 percent of the respondents said they plan to spend up to $500 this year on back-to-school gear, compared with 48 percent last year. Twenty percent said they plan to spend $500 to $1,000.

A PriceGrabber survey in June had showed that nearly half of consumers expected to spend more this back-to-school season than in 2011 and that nearly 80 percent planned to buy online.

Purchases of technology products are increasing, but school clothing and supplies top most shoppers' lists, according to the survey. When asked what they plan to buy, 79 percent of consumers said new clothing, 51 percent a backpack, half said books, and 40 percent listed a technology-related item, such as a laptop, tablet computer or smartphone.

Some stores have begun to see such predictions come to fruition. At the Justice store at White Marsh, which focuses on items for pre-teen girls, backpacks with silver sparkle monograms have been big sellers. A 40 percent-off sale pulled some shoppers in, including one Wednesday morning who bought $300 worth of school clothing for her daughter, said Tonya Ringgold, the assistant manager.

Next door, The Children's Place advertised backpacks and school uniforms. Tyra Jones checked racks of discounted summer clothing, accompanied by her mother, two daughters and a nephew. They had come to the mall to buy a birthday gift for Jones' 7-year-old daughter Kayla. Back to school was not forefront in Jones' mind.

When she turns her attention to it, Jones said she'll compare prices online before returning to stores such as The Children's Place and Justice.

"I pick stuff up here and there," Jones said. "I look online before I come and see if they have [an item] and if it's on sale."

Shopping snapshot

How much consumers plan to spend on back-to-school items in 2012:

Up to $500: 63 percent

$500 to $1,000: 20 percent

No back-to-school budget: 17 percent

What consumers plan to buy for going back to school in 2012:

School supplies: 83 percent

New clothing: 79 percent

Backpack: 51 percent

Books: 50 percent

Tech product: 40 percent

Source: Surveys by PriceGrabber, a website that tracks and compares retail prices.