It happens every year. Back to School is one of the most heavily marketed
shopping seasons, with many stores slashing prices to clear out as much of
their stock as possible. The usual suspects of school supplies and clothing
are heavily discounted as students and their parents shop for the upcoming
school year. But this year, things were a little different. In looking at
Amazon’s latest data, we’ve identified a few distinct trends that shed some
light on what’s driving the back-to-school season and how it is changing.
Promotions Drive the Back-to-School Season OnlineBy Jeff Brown, Director of Client Services at One Click Retail
Last week, we analyzed Amazon’s top 5 product groups for the month of August and found that back-to-school items were performing much better than in previous years. This week, we take a closer look at those products in particular, specifically the “Apparel” and “Office Products” groups, to see what trends are emerging.
Although the back-to-school season can sometimes be considered to run from mid-July to mid-September, for the purpose of this article we are looking specifically at August. Our period runs from July 31st to August 27th and we’ll be looking at both Year-over-Year (YoY) figures as well as the “lift” caused by the season, which is compared to the period running from June 5th to July 2nd, so that the numbers are not skewed by Amazon Prime Day (July 12).
A note on the period:
A continuing trend this year is the increased digitization of the public, including
students and children. As personal computers, tablets and smartphones become
increasingly integrated into everyday life, they are increasingly becoming part of
the back-to-school market. More and more, retailers and manufacturers are
pricing traditional “analog” school supplies (like notebooks and pencils) at a very
steep discount, using them as loss leaders to entice shoppers to purchase their
more expensive electronics from them at the same time.
Trend #1: Analog gives way to digital
As one of the busiest annual shopping seasons, consumers wary of crowds,
lines and overall chaos are increasingly going online. Amazon experienced a YoY
growth of over $25 million this year in back-to-school sales alone, an increase of
more than 20%. With Office Organization category items being the main driver,
accounting for more than $5 million alone, Amazon is demonstrating that it can
successfully compete in a broad spectrum of categories not typically associated
with e-commerce. Consumers are becoming more and more comfortable with
buying just about anything online.
Trend #2: Back-to-school goes online
The most striking trend is just how completely promotions have driven sales
in Amazon’s 2016 back-to-school season. The leading category, Office
Organization, contained 48 unique promotions with an average discount of
18%, while Writing Instruments and Accessories contained over 500
promotions. Although the majority of the promos were “buy X get Y” deals,
Paper Mate, which alone offered 270 promos, received a 180% lift with clip
coupons worth less than one dollar.
Trend #3: Promotions drive sales
The best selling item on Amazon during the 2016 back to school season
was a black TI-84 Plus Graphics Calculator from Texas Instruments, with
nearly $4 million worth sold in these four weeks (the 4th week was
driven by a Gold Box deal). The Calculator category as a whole
experienced a lift of almost 500%, second only to uniforms with almost
double that.
Apparel as a whole, however, did not experience the same kind of YoY growth as Office
Supplies did and similarly did not contain nearly as many promos. Looking forward, we can
see that brands use promos to compete with each other during the busy shopping seasons of
the year and position deeply-discounted “old” technology as loss leaders in order to draw in
customers. Electronics and personal computers will be more clearly associated with back-to-
school as digital devices become staples on back-to-to school lists for students of all ages.
Finally, Amazon continues to outpace brick-and-mortar sales – and the brands that are
capitalizing on this growth are utilizing promotions to outsell the competition.
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