Back-to-School is About to Look Different. Here’s What Merchants Need to Know to Prepare.

InnovationCreditResearch and Insights

The annual ritual of back-to-school prep is usually a combination of fun and some stress. But like all things in a year defined by the COVID-19 global pandemic, this year’s experience also has underlying uncertainty around the world, especially in the U.S.

In typical times, merchants play an important role in making the back-to-school experience simpler and less stressful for parents. Now, they have an even bigger opportunity to help shoppers navigate this tricky time of year.

With such an unusual back-to-school season on the horizon, here’s what merchants need to keep in mind.


Back to School Insights
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Despite uncertainty, spending is on its way up

While parents of K-12 students and college students themselves are no doubt feeling unsure about what the new school year will bring, they’re planning to spend more on back-to-school supplies, according to an online study of 600 college students and 1,200 K-12 parents in July 2020, commissioned by PayPal and conducted by Netfluential.

Forty percent of parents and 35% of college students plan to spend more this year than last. Of note, first-year college students will spend $732 on average, compared to $444 among K-12 parents.   

Aligned with increased spending, online shopping is also heating up. Among college students, 70% are doing more online shopping than before because of the pandemic and nearly three-quarters will be doing their back-to-school shopping online.

It’s not just the basics, either – parents and college students are also planning to purchase remote learning equipment, with 63% saying they plan to spend more on remote learning furniture and home goods and 59% indicating spending increase on remote learning and tech. Retailers should keep in mind that online shopping may be the primary (or only) choice for some customers, so it’s up to merchants to help them find what they're looking for, easily and safely. That means acting on what customers will be looking for this season and potentially diversifying their online selection. 


Back to School Habits
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The “hot” back-to-school items aren’t what they used to be

But when it comes to going back to the classroom versus embracing at-home learning, it’s clearly not an “either/or” scenario. That means among parents, 59% plan to spend more on tools and tech to make remote learning easier, including headphones, laptops and tablets, arts and crafts materials, monitors, and bookcases and desks, including standing desks.

Flexible payment options are in demand, in part for safety

Along with helping shoppers safely prepare for the school year, merchants should also offer flexibility in how customers can pay.

Uncertainty around COVID-19 is driving more shoppers to seek out flexible options in how they pay for back-to-school items. Safety-conscious parents, for example, want options like contactless payment in store, to limit risk.

It’s no surprise that safety is top of mind for back-to-school shoppers this year. Face masks (reusable and disposable), hand sanitizer and gloves have all made it onto back-to-school shopping lists this year, and a whopping 81% of those surveyed plan to spend more on these kinds of supplies than they did last year. Close to three-quarters also plan to spend more on disinfecting wipes.

Given economic uncertainty, nearly 40% of parents and almost a third of college students are also interested in having the option to pay over time, through an installment plan, or having access to a digital line of credit, like PayPal Credit.

Among parents, over half (55%) said they’d want to use that kind of flexible payment option for clothes, 49% said the same for shoes, and 45% would prefer it for electronics. College students feel similarly, with 51% saying they’d use a digital line of credit or installment plan for clothes, and 43% indicating they’d use it for electronics and school supplies.

For merchants gearing up for back-to-school, the bottom line is to be as prepared as possible for the influx of new customer needs, whether it’s flexible payments options, ease of online shopping or safety equipment. Despite back-to-school season being more stressful and uncertain this year, shoppers are really just looking for ways to make it work – and merchants have an opportunity to help them – and themselves – during a challenging time for all. 

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