Custom art, air purifiers and TikTok: College spending boom could booster retailers' sales this fall

 Custom art, air purifiers and TikTok: College spending boom could boost retailers' sales this fall

College students and their families are expected to spend a record amount this year as demand for electronics and dorm decor soars.The average that households plan to spend on returning to college has shot up 40% to about $1,367 per person since 2019, according to the annual survey.

Retailers say sales have surged in the past year as younger consumers watch dorm videos on TikTok and want their college housing to reflect their personalities. Over the past few years, Alicia Browne has noticed a change in what college students take out of their cars when they move in. days at the University of Alabama. Along with pillows, blankets, and laptops, more students are coming with mini-fridges, headboards, Keurig coffee makers, and even air purifiers. Some hire decorators to drop off linens, custom-made curtains, and other furniture or decor orders on a specific delivery date to a supplier the university has set up.

"It's grown over the last decade — but since Covid, I think it's really exploded," said Browne, the university's director of housing management for about 13 years.The rise in college spending could be one of the biggest sales opportunities for retailers this fall. College students and their families are expected to spend a record amount this year: an average of about $1,367 per person, according to an annual survey conducted this summer by the National Retail Federation and market research firm Prosper Insights & Analytics. According to the survey, this number has increased by about 40% since 2019.

Browne attributes the rising spending to the influence of TikTok videos and other social media posts showcasing luxury dorms. She said some parents also want to spend for children who have lost years of milestones and typical socialization during the pandemic.

"Parents and families clearly feel that their students have lost things because of Covid, that maybe help is needed to make up for the missed experiences," Browne said. "I think part of that is trying to make sure that their student is as comfortable as possible, as successful as possible, that their entry into school is as good as possible. And that's about their living situation and what families are willing to pay." for that."

The back-to-college boom also creates an opportunity for retailers to attract and bond with a new generation of younger shoppers."You're establishing a relationship at a very important and vulnerable age," said Marshal Cohen, senior retail industry consultant at Circana, a market researcher formally known as IRI and The NPD Group. "A strong salesperson will maintain that relationship over time."

This year, that spending and those closer ties could especially help companies like Target, Walmart, Kohl's and others, which said more frugal shoppers are buying fewer big-ticket or discretionary items like clothing, electronics and furniture. These retailers will likely share some early insights into sales trends when they report earnings in the next few weeks.

Still, back-to-college sales alone may not overcome retailers' other challenges. Many companies, including Best Buy and Macy's, expect sales to fall this fiscal year as higher food prices squeeze wallets and consumers return to spending on experiences.

Some forecasts for the new school year are not as rosy as the NRF estimates. Consulting firm Deloitte predicted that back-to-school spending for kindergarten through high school students will drop 10% year-over-year to $597 per student as consumers focus on must-haves and choose retailers with lower prices or more bargains. She didn't anticipate spending back on college.

Households don't expect to spend just because of inflation, according to NRF flashbacks. Survey respondents also said they expect to buy more new goods and big-ticket items like electronics and furniture than last year.

A growing pie – and market share up for grabs

With college spending set to rise, retailers have another reason to vie for student dollars. This fall is the first back-to-school season since Bed Bath & Beyond filed for bankruptcy and closed its stores, leaving market share for others to grab.

Along with its 20% off coupons, Bed Bath has built a strong reputation as a one-stop-shop for college. It contained many things that students needed, including "bed in a bag" sets, which usually included a matching comforter, sheets, pillowcases, and sometimes imitation pillows. Bed Bath also allowed families to purchase items at their local store and pick them up at a location near their campus in another state or city.

It is difficult to estimate what share of the college market Bed Bath had in total. The company reported revenue of $1.44 billion in the quarter that ended last August. This total includes sales from other product categories and its BuyBuy Baby and Harmon chains.Those dollars can now go to retailers like Amazon, Home Goods-owned TJX and Ikea.

Cristina Fernandez, a retail analyst at Telsey Advisory Group, said she expects Target to be one of Bed Bath's big market share winners. She said Target could attract former Bed Bath customers because it carries student-friendly items from decor to toiletries and food, has similar locations to former defunct suburban retailers and has plenty of stores near college campuses.

She said the NRF forecast seems high, but families are willing to spend on students.For example, she said, the high-end Pottery Barn Teen brand, owned by Williams-Sonoma, has teamed up with LoveShackFancy, a New York retailer known for frilly and floral designs that cater to shoppers at stores in the Hamptons and on Madison Ave.

Other retailers are also getting creative to attract these college shoppers.The namesake brand Williams-Sonoma has debuted a kitchen entry website for students setting up their first apartment or shared dorm kitchen.

Walmart and Target have featured a great mix of college-friendly items on their websites and social media pages, from fuzzy pillows to retro-inspired mini fridges. Shipt, the Target-owned delivery service, and Walmart have tried to attract more college students to their membership programs by offering a special discounted price.Target has also partnered with college-aged TikTok influencers for videos showcasing dorm room decor.

Shoppers at The Container Store will see some merchandise from Dormify, a direct-to-consumer retailer, in pop-up stores and online. Dormify co-founder Amanda Zuckerman started the online retailer out of frustrations she had with shopping in her own dorm. decor at Bed Bath & Beyond.Now Zuckerman said Dormify is trying to turn Bed Bath's closing into a business advantage. It said its average order value was up 15% this year compared to the same period last year.

It is difficult to estimate what share of the college market Bed Bath had in total. The company reported revenue of $1.44 billion in the quarter that ended last August. This total includes sales from other product categories and its BuyBuy Baby and Harmon chains.

Those dollars can now go to retailers like Amazon, Home Goods-owned TJX and Ikea.

Cristina Fernandez, a retail analyst at Telsey Advisory Group, said she expects Target to be one of Bed Bath's big market share winners. She said Target could attract former Bed Bath customers because it carries student-friendly items from decor to toiletries and food, has similar locations to former defunct suburban retailers and has plenty of stores near college campuses.

She said the NRF forecast seems high, but families are willing to spend on students.

For example, she said, the high-end Pottery Barn Teen brand, owned by Williams-Sonoma, has teamed up with LoveShackFancy, a New York retailer known for frilly and floral designs that cater to shoppers at stores in the Hamptons and on Madison Ave.Other retailers are also getting creative to attract these college shoppers.The namesake brand Williams-Sonoma has debuted a kitchen entry website for students setting up their first apartment or shared dorm kitchen.

Walmart and Target have featured a great mix of college-friendly items on their websites and social media pages, from fuzzy pillows to retro-inspired mini fridges. Shipt, the Target-owned delivery service, and Walmart have tried to attract more college students to their membership programs by offering a special discounted price.

Target has also partnered with college-aged TikTok influencers for videos showcasing dorm room decor.At The Container Store, customers will see some merchandise from Dormify, a direct-to-consumer retailer, in pop-up stores and online.

Dormify co-founder Amanda Zuckerman started the online retailer out of frustrations she had shopping for her own dorm decor at Bed Bath & Beyond.Now Zuckerman said Dormify is trying to turn Bed Bath's closing into a business advantage. It said its average order value was up 15% this year compared to the same period last year.

She said the company's growth has been driven by college students who want uniquely decorated rooms that reflect their personalities. They've evolved for items that weren't on shopping lists years ago, including temporary wallpaper, neon signs and gadgets like matcha machines and makeup fridges.Social networks have amplified this trend. Now people are showing off their dorm room to the world, not just their roommates."The bar has been raised and I think that has a lot to do with TikTok," she said. “That's really all.

Kate Reppeto, a rising senior at the University of Mississippi, got creative and stretched her dollars when decorating her college housing. The 22-year-old moved into a four-bedroom house to share with three friends near the school's Oxford, Miss., campus last weekend.

Since she's returning to the same house as last year, Repetto said she was able to reuse most of her furniture and decorations. That includes a favorite item: a fluffy white bean bag she got at a yard sale. She hangs a picture of a cow that reminds her of growing up in Southlake, a suburb of Dallas-Fort Worth, Texas.

She said she plans to buy some new items, such as clothing from Lululemon and the American Eagle-owned Aerie chain, along with makeup. She recently bought a blender from Target. However, she estimated that she would try to spend no more than $400.

Still, she said it's less than the amount she's seen other students spend. In her freshman year of college, she said she had to resist pressure to blow the budget.“It was almost like a silent competition,” she said. "Who has the prettiest or prettiest dorm?"

These extravagances have created a business for decorators like Dorm Decor, a Birmingham, Alabama-based company that doubles as a dorm retailer and interior designer. It specializes in headboards, skirts, storage sofas and giant pillows called Dutch Euros.

Elizabeth Edwards, sales and marketing manager for Dorm Decor, said families typically spend between $500 and $2,500 per child. She said the company offers plenty of options and personal touches, including pillows that come in pink or tiger stripes, items that can be monogrammed and custom paintings from an in-house artist that can match students' decorations.

She said parents across countries and income levels are turning to the company to turn their children's sterile rooms and "prison-type mattresses" into a sense of home."Their income doesn't matter," she said. "They want their child to feel comfortable like everyone else."