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The end of the summer is usually a high point for retailers. But it's mid-August and registers have not been ringing at their usual rate. In fact, back-to-school revenues are the lowest they've been in over a decade.

That spells bad news for the 2009 economy. But if there's one thing that is becoming more important in the moving of consumer goods, it is online marketing.

Back-to-school spending is usually an early indicator of the all important holiday shopping season. And it is already looking like it's going to be a slow Christmas.

According to a report from research company IBISWorld, back-to-school spending is falling in nearly every category compared with last year: clothing is down 5.4%; footwear down 4.4%; and electronics down 1.8%. Sales of traditional school supplies like notebooks and pencils are expected to be about the same as last year.

Citigroup analysts predict this will be the first decline in back to school sales since they began tracking figures in 1995. And the National Retail Federation expects the average family with school-age children to spend nearly 8% less in 2009 than they did last year.

That makes good deals even more important. Those who are shopping are putting more legwork into their spending. According to Google, searches for coupons are up 40% over last year, while buy-one-get-one-free searches have jumped 30%.

When times are tight, online marketing gets even more useful. According to The New York Times:

With consumers in such a penurious mood this year, retailers are learning that they can skip aggressive online marketing only at their peril. Joanne Fraembs, a mother of two in Wantagh, N.Y., put it: “I don’t go into stores that don’t send the e-mails.”

And the numbers seem to support that. According to comScore, online marketing is having as much effect on sales of consumer packaged goods as television advertising.

A study conducted with dunnhumbyUSA found that over 12 weeks, online ad campaigns with an average reach of 40% of their target segment grew retail sales of the advertised brands by an average of 9%, compared to an average lift of 8% for TV advertising.

comScore chairman Gian Fulgoni said in a statement: “It is likely that the more precise targeting ability of the Internet – especially in terms of accurately reaching the desired demographic segment -- is a key reason for its effectiveness. That is meaningful in and of itself, but when you take into account the fact that online advertising is generally less costly than television, these results take on even greater significance.

Image: Avolore

Meghan Keane

Published 17 August, 2009 by Meghan Keane

Based in New York, Meghan Keane is US Editor of Econsultancy. You can follow her on Twitter: @keanesian.

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Comments (3)


Affordable Promotion

I'm betting that given how many parents are unemployed now before too long more kids will be being taught at home than at school. Back-to-school may well become a thing of the past. No bad thing, I say, as I've always felt school was not so much about education as about social conditioning, conditioning to fit into a society that increasingly isn't there any more.


about 7 years ago


Jessica Sharp

How the economy has affected our shopping habits this "back to school" season.

No frills clothing purchases.  Shoes, Jeans, Outerwear for climate.

No new backpack.  In fact the neighborhood has gotten together and we passed down backpacks to the younger group out of our closet supply.

Using Bing to compare pricing and emailing to other mothers when we find "the deal"

Coupon Hunting a must.  Discounts a must. 

online retailers beware..

1. remember me and my shopping cart

2. shopping cart security a must or I use PayPal with the green URL bar which stands for EV SSL (extended validation) .

3. offer me incentives when I am loyal and return

4. no shipping charges EVER.

5. human customer support

Safe shopping and good luck finding the bargains.


about 7 years ago


School prospectus design

Interesting. I wasn't aware that back-to-school sales could be such a major indicator of how the economy will do during the holiday season. It'll be interesting to see how it will fare this year!

over 6 years ago

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