Why Back-to-school Retail Sales Are Down This Year

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Back-to-school retail sales were disappointingly below expectations in August, and AceMetrix research reveals two reasons why: Fewer ads, and markedly less effective ones.

“[F]ewer [retailers] are running TV and online video ads this season,” Advertising Age reported September 9, “[a]nd those ads that are being aired are not as effective as they once were.”

C-minus sales

As early as July, the National Retail Federation was predicting a 13 percent drop back-to-school sales.

The industry group announced…that families with school-aged children will spend an average of $635, down from $689 last year. Families with kids in college will spend an average of $837, down from $907 a year ago. Total back-to-school and back-to-college spending will fall to $72.5 billion from $83.8 billion.

Those predictions have come true, and then some.

“Last year we saw pretty good volume even in an Olympic year, so I’m surprised to see this season fall short,” Gloria Consola, AceMetrix VP-corporate marketing, noted.

What’s worse is that the apparel and accessories category, which usually accounts for more than half of back-to-school retail purchasing, was weaker than electronics, which account for less than a third.

[R]etailers including Kohl’s, Target, Dick’s Sporting Goods and Abercrombie & Fitch reported weak second-quarter results and expressed caution concerning the second half. At the start of the season, the National Retail Federation forecasted a 13% decline in spending.

“August sales were softer in the apparel segment compared to July, but were steady elsewhere,” said Michael P. Niemira, VP-research and chief economist at the International Council of Shopping Centers. “The back-to-school apparel demand was uneven and late.”

And this year’s advertising may have had more than a little to do with that.

D-plus ads

There were lots of back-to-school ads this year – not only from retail stores but from brands like Lysol, Sonic, Oreo, Verizon, Excedrin and Bing.

But according to AceMetrix, there were fewer retail ads than last year – 55 versus 62, an 11 percent decrease.

And if you had to pick one adjective to describe those ads, it would have to be “below average.” This is based on composite effectiveness scores which combine such criteria as information, emotion, engagement, persuasion and other specific qualities advertisers aim for.

“The current 90 day average across all categories that Ace Metrix tracks (~85) is 509,” the research firm’s blog reports. “The Back to School average Ace Score this year is 502.”

That’s not only below the general advertising average. It’s also below last year’s category average, by 5 percent.

Some advertisers were even farther below average than others. JCPenney and Target, for example, each ran six more ads than last year, but their campaigns were 12 and 14 percent, respectively, less effective – and that’s despite one spot each in the top ten performers. Staples and Macy’s chose to run fewer ads, but here was a case of less is less; their 2013 entries were, respectively, 9 and 7 percent less effective than the year before.

Highest on a low grading curve

Below are the most effective commercials of a weak bunch, the winners by default. (Click the link to watch them.)

  • #1 – Best Buy “Dreams”: Aside from one lone mention of “America’s Back To School Techfitter” in the end title, this really isn’t a back-to-school commercial. It’s about how the store can match up a computer from their inventory to your specific needs.
  • #2 – JCPenney “Do Something”: Mostly about the virtues of the Adopt-A-Classroom program, which you somehow support by buying back-to-school stuff (which, by the way, you can personalize) at JCPenney.
  • #3 (tie) – Best Buy “Tim’s Custom Buy”: Same story as “Dreams,” above.
  • #3 (tie) – Office Depot “One Direction”: Preteen girls go gaga over notebooks and stuff with band One Direction’s picture and ask each other the campaign’s tag line, “Where’d you get that?”
  • #5 – Kohl’s “Saving Session”: Your standard price-point commercial showing items marked down, this time for a “Saving is in Session” sale. Yawn.
  • #6 – Office Depot “Moving Together”: Band member of One Direction are black-and-white talking heads in a co-promotion to support an anti-bullying school program.
  • #7 – Office Depot “Pre-Teens”: School kids ooh and aah over each other’s gear and ask, “Where’d you get that?”
  • #8 – Kohl’s “Savings 101″: Same endless listing of sale items, only with a different sale name.
  • #9 – Kohl’s “Back to School Savings”: Ditto
  • #10 – Target “Erupt in Supplies”: School kids build a chemical volcano, decorated with pencils, crayons and plastic dinosaurs and Lego figures. The message: “School takes a lot. Target has it all.”

The biggest lesson

Most of these commercials are talking about themselves, not consumer wants and needs. Many, supposedly about back-to-school gear, used borrowed-interest devices like philanthropic causes, celebrity bands, or both. Also with many – particularly Kohl’s and to a lesser degree Office Depot and Best Buy – the structures are formulaic, with the major differences from spot to spot being how the same blanks are filled in.

“Retailers may be playing it safe,” Consola told Ad Age. “There aren’t as many standout performances as we saw last year, so absolutely it’s safer creative.”

But safe doesn’t sell. It bores, and the numbers – both the AceMetrix scores and the sales figures – show it.

So running “safe” advertising may be the riskiest marketing tactic of all.

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