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In 1776 Thomas Paine wrote: “If there must be trouble, let it be in my day, that my child may have peace.” Those words are echoed in the current economy, reflecting a mother’s desire to shelter her children from economic hardship.
To better understand how the economy has affected back-to-school (B-T-S) shopping, and for a bit of foreshadowing for the upcoming holiday season, OTX Research interviewed 300 drug store shoppers of the past month who had children under the age of 17.
One of the most telling results is that despite the fact that virtually all of the consumers said they are cutting back on household expenses, only 20% said they are cutting back on B-T-S shopping.
However, there are some major shifts in consumer shopping behavior.
Mass merchants are the clear leaders for B-T-S shopping, and they stand to gain as consumers look for value.
Nearly all consumers say they plan to shop for B-T-S at a mass retailer, and almost three-quarters of them (71%) will do the majority of their B-T-S shopping in those stores. And while many consumers (42%) will also shop at a drug store for B-T-S supplies, only 12% will purchase most of their supplies there.
Almost all mothers (83%) consider price when thinking about where to shop for B-T-S supplies, and price is the single most important factor for more than half (56%) of the consumers who were interviewed.
As a result of the changing economy, roughly one in four mothers (23%) claim that they will do more B-T-S shopping at mass merchants this year. In contrast, just over one in 10 moms (12%) will do more B-T-S shopping at drug stores.
Consumers who plan to shop more at drug stores this year cite a number of potential drivers, including coupons (64%), convenient location (58%) and prices (47%). Those who plan to shop less at drug stores this year tend to mention such barriers as pricing (50%), selection (36%) and competitive coupons (36%).
While mass merchants collect the majority of consumer spending on B-T-S supplies, they are not the only threat to drug stores for the B-T-S dollar. Since mass merchants are favored for stocking-up shopping trips, drug stores compete heavily with grocery stores and office supply stores for the quicker fill-in shopping trips.
The difficult economy also will have a noticeable impact on the holiday gift-giving season, affecting not only consumers’ total spending but also their selection of specific products. Consumers plan to buy more items at lower prices (less than $20) and fewer items at higher prices (more than $20). This trend may benefit chain drug stores that offer a wide range of relatively inexpensive gifts.
In summary, we turn to Benjamin Franklin, who was not only one of America’s great statesmen but also an early advice columnist and consumer advocate: “Waste neither time nor money, but make the best use of both.” For many consumers, time is best used in the pursuit of savings.
Chain drug stores play a critical role in B-T-S shopping for quick trips and fill-in shopping. Retailers that stay top-of-mind and deliver sufficient variety and pricing can leverage the ease and convenience of shopping at drug stores to attract a greater share of total B-T-S and holiday spending.
EDITOR’S NOTE: Tom Palmer is executive vice president and managing director of the central region at OTX Research.