2015 Back-to-School Survey Reading, writing, and retail. Conducted July 5-8, ,015 responses

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1 Back-to-School Survey Reading, writing, and retail Conducted July 5-8, 1,015 responses

2 About the survey The survey was commissioned by Deloitte and conducted online by an independent research company between July 5 and 8,. The survey polled a sample of 1,015 parents of school-aged children and has a margin of error for the entire sample of plus or minus three percentage points. All respondents had at least one child attending school in grades K 12 this fall. Back2School15 # As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. 2 Copyright Deloitte Development LLC. All rights reserved.

3 Total household spending (including children) this back-to-school season What is the total amount you [parent] and your children expect to spend on back-to-school items this season? $700 $672 $600 $543 $500 $434 $400 $300 $200 $100 $ Only 11% of parents intend to make cash purchases down from a high of 26% in Copyright Deloitte Development LLC. All rights reserved.

4 31% of respondents will complete their back-toschool shopping after the school year starts When do you plan to complete your back-to-school shopping? 2 months before the school year 1% 3% 1 month before the school year 13% 16% Less than a month before the school year 54% 54% After the start of the school year 26% 31% 4 Copyright Deloitte Development LLC. All rights reserved.

5 Consumer sentiment toward economy is unchanged today same theor better issituationfinancialtheirsayrespondentsof 79% Areyou more confident about the U.S. than,( July )nowprospectseconomy s you were at the end of? 35% 31% 48% 49%, home )assetshousehold'syouraboutthinking cash, car, etc.) and your liabilities (credit card bills, mortgage, etc.), is your household's financial today situation 32% 35% 44% 44% 16% 20% 24% 21% Yes No Don't know/no opinion Better than it was a year ago The same as it was Worse than it was a a year ago year ago 5 Copyright Deloitte Development LLC. All rights reserved.

6 Top 5 concerns respondents have about the U.S. couldthatfinanceshousehold stheiroreconomy impact their back-to-school shopping Which of the following concerns do you have about the U.S. economy or your household's finances that could hold back your back-to-school spending? Higher food prices 64% 60% Higher medical bills and/or premiums 44% 46% Higher energy prices 55% Personal debt level is still high 42% Political unrest in other countries 28% 29% Lack of improvement in the job market 33% 28% 0% 10% 20% 30% 50% 60% 70% 6 Copyright Deloitte Development LLC. All rights reserved.

7 Respondents are modifying their back-to-school shopping behaviors Howareyoulikelytochangethewayyoushopforback-to-school items this season because of your concerns about the U.S. economy or your household's finances? (Percentage point change over the five-year period from 2011-present) (Among total) 15% 10% 13% 12% 10% 5% 0% -5% -10% -15% -14% usei ll more store coupons -5% I llshopat different (less expensive) stores than I usually do -11% morebuyi ll lower-priced back-to-school items -8% morebuyi ll back-to-scho on itemsol sale Our household will reuse year slast school items rather than buying new researchi ll more back-to-scho ol items online to find the best prices purchasei ll more back-to-scho ol items online, to find the best prices 7 Copyright Deloitte Development LLC. All rights reserved.

8 Among the top school items respondents plan to purchase, the brick-and-mortar store ranks higher than online as the channel where they intend to buy Please indicate if you plan to buy in-store or online or both in-store and online. School supplies: Paper, pencils, books, etc. [Base: Among those who intend to purchase] 87% 2% 11% Rank/Preference 1 Clothes 64% 4% 33% 2 Shoes 80% 5% 15% 3 Backpack/book bag/lunch box 71% 10% 18% 4 Jewelry/handbag/personal accessories 66% 7% 27% 5 Technology devices 49% 25% 26% 6 Wearable devices 30% 41% 30% 7 Yes, plan to buy in-store Yes, plan to buy online Yes, both online and in-store Sorted in order of rank/preference 8 Technology devices category includes the average of: computer software/small accessories; notebook or tablet; cell phone/smart phone; computer - desktop/laptop; printer or other computer hardware; and other personal technology product Copyright Deloitte Development LLC. All rights reserved.

9 Top 5 shopping destinations this school season Online takes sole possession of second place for first time in survey history In what types of retail environments do you plan to do your back-to-school shopping? 100% 80% 60% 91% 90% 85% 86% % 44% 45% 43% 36% 38% 38% 20% 36% 36% 30% 27% 28% 30% 31% 31% 28% 30% 22% 22% 0% Discount/value department stores Online sites Office supply/technology stores Specialty clothing stores Off-price stores Traditional department stores 9 Copyright Deloitte Development LLC. All rights reserved.

10 Retail environments to be shopped by age cohort, clothingspecialty shoptoplanningare( oldsyear ) Younger generations ageotherthanfrequencymore storesdepartmenttraditional and, off-price groups this back-to-school season 100% 90% 80% 70% 88% 86% 80% 79% Inwhat types of retail environments do you plan to do your back-to-school shopping? 60% 50% 30% 55% 47% 48% 49% 43% 37% 35% 31% 32% 50% 38% 34% 33% 36% 30% 24% 20% 10% 0% Discount/value department stores Online sites Office supply/technology stores Off-price stores Specialty clothing stores Traditional department stores Copyright Deloitte Development LLC. All rights reserved.

11 Smart phone and tablet ownership is rising inconsumer connectedalways ancreatingistechnologyingrowthexponential a 24/7 shopping environment Doyouownasmart phone? Doyouownatablet? 100% 90% 80% 70% 80% 84% 88% % 70% 60% 66% 73% 60% 57% 50% 50% 30% 30% 20% 20% 10% 10% 0% 0% Among survey respondents, two in 10 (20%) own wearable devices 11 Copyright Deloitte Development LLC. All rights reserved.

12 Smart phone and tablet owners will use their devices in multiple and varied ways to engage with retailers With regard to your back-to-school shopping, for what purposes would you likely use a smart phone? [Base: Among 80% of smart phone owners who plan to use them for back-to-school shopping] +6 vs. With regard to your back-to-school shopping, for what purposes would you likely use a tablet? [Base: Among 53% of tablet owners who plan to use them for back-to-school shopping] Get/download discounts, coupons, sale information 57% Shop online 65% Get price information 57% Get price information 64% Get a store location 53% Access a retailer's website 59% Access a retailer's website 44% Get product information 56% Get product information 42% Make a purchase 53% Locate a store that carries a particular product 37% Read product/retailer reviews 48% Shop online 36% View a retailer's ad 46% Answer choices below 36% not represented for Answer choices below 46% not represented for 12 Copyright Deloitte Development LLC. All rights reserved.

13 Mobile payment and in-store beacons are still an emerging technology and expect to be used by a small percentage of respondents this back-to-school season Do you plan to use a mobile payment or digital wallet service to complete a purchase this back-to-school season? No 93% Yes 7% Among smart phone owners, 9% plan to engage with in-store beacon technology to a greater extent than last year while back-toschool shopping Only half (49%) of respondents know what in-store beacon technology is. 16% of respondents will engage with in-store beacon technology this back-to-school season 13 Copyright Deloitte Development LLC. All rights reserved.

14 Social media is of declining importance to back-toschool shoppers Do you plan to use social media sites to assist in your back-to-school shopping? 35% 35% 30% 25% 20% 22% 21% 18% 15% 10% 10% 5% 0% Copyright Deloitte Development LLC. All rights reserved.

15 Respondents are concerned about the protection of their personal data % who agree or somewhat agree I am concerned about the protection of my personal data when shopping online 65% 68% I am more concerned about the protection of my personal data when shopping online than one year ago 55% 54% I am concerned about shopping at retailers that have experienced a data breach 53% 52% I am concerned about the protection of my personal data when shopping in the physical store 51% 50% I am more likely to shop at a retailer who provides me education surrounding the security of my personal data 44% I will use a different form of payment when shopping as a result of a data breach 28% 33% 15 Copyright Deloitte Development LLC. All rights reserved.

16 Trends impacting school buying: From school lists to storeinuppick, onlinebuy and, shippingfree % who agree or somewhat agree 69% mythanlistproductrecommendedschool sthebymoreinfluencedisshoppingback-to-school My children srequests 66% I am more likely to purchase from online retailers who offer free shipping during the back-to-school shopping season 38% The back-to-school shopping season is less important to my family because we replenish school supplies throughout the year and feel less need to stock up 32% 17% arechildrenmybecause( notebooks, crayons, pencils,. i.e )suppliesschooltraditionalfewerbuyingi m using more digital technologies like tablets/computers in and out of the classroom inuppick, onlinebuy tooptionthebecauseseasonback-to-school I will shop physical stores less this store ismoreconvenient 16 Copyright Deloitte Development LLC. All rights reserved.

17 Back-to-College Survey Reading, writing, and retail Conducted July 5-13, 450 responses

18 About the survey The survey was commissioned by Deloitte and conducted online by an independent research company between July 5 and 13,. The survey polled a sample of 450 parents of college children and has a margin of error for the entire sample of plus or minus five percentage points. All respondents had at least one child attending college this fall. 18 Copyright Deloitte Development LLC. All rights reserved.

19 College families average combined spending Families (including children) will spend on average $1,313 this back-to-college season an increase of $90 from What is the total amount you [parent] and your children expect to spend on back-to-college items this season? $1,400 $1,350 $1,300 $1,360 $1,313 $1,250 $1,223 $1,200 $1, Copyright Deloitte Development LLC. All rights reserved.

20 Top 5 college items most in demand College supplies, clothes and shower and bathing items rank 1-2-3, respectively Which back-to-college items will you or your children be purchasing this season? College supplies: Textbooks, calculator, etc. 85% 84% Clothes 82% 79% Shower and bathing items Shoes 61% 62% 61% 61% Dorm accessories and supplies: Bedding, storage solutions, etc. 55% 57% 0% 20% 60% 80% 100% 20 Copyright Deloitte Development LLC. All rights reserved. Items below 57% not presented in this chart for

21 Top 5 retail environments where consumers plan to do their back-to-college shopping In what type(s) of retail environment(s) do you plan to do your back-to-college shopping? Discount/value department stores 77% 74% Book stores/university stores 62% 62% Internet, excluding auction sites 44% 43% Office supply/technology stores 41% Home furnishings and housewares stores 32% 0% 20% 60% 80% 100% Respondents expect to take on average 5 shopping trips when purchasing back-to-college items 21 Retail environment below not presented in this chart for Copyright Deloitte Development LLC. All rights reserved.

22 Gender differences in college buying behaviors Female respondents plan to be more price/budget conscious, prefer more flexible shopping options; male respondents will purchase more online to find best prices % who agree or somewhat agree 48% 58% 49% I prefer to purchase from those retailers that offer an option to buy online/pickup in-store or buy online/return to store this back-to-college season I will only shop in stores that offer sales this back-to-college season I will purchase more items online to find the best prices this back-to-college shopping season 62% 58% 62% 72% I will seek more discounts, coupons, and deals when back-to-college shopping this season 77% 86% of college students will likely buy more used textbooks or textbook rentals to help stretch their back-to-college spending budget 22 Copyright Deloitte Development LLC. All rights reserved.

23 Electronic devices owned by parent and children, however, groupparentinincreasedhaveusers tablet and phonesmart digitalcamera usershavedecreasedinchildrencategory Which of the following electronic devices do you [parent] own? Which of the following electronic devices does your college going children own? Computer Desktop/laptop 93% 93% Smart phone 89% 90% Smart phone 80% 88% Computer Desktop/laptop 84% 88% Digital camera 76% 71% Tablet 32% 37% Tablet 52% 62% Digital camera 45% 34% E-reader 32% 37% E-reader 17% 16% Wearable device (Apple Watch, Fitbit, Wearable etc.) device 20% Wearable device (Apple Watch, Fitbit, Wearable etc.) device 10% 0% 20% 60% 80% 100% 0% 20% 60% 80% 100% 23 Wearable device data not available for Copyright Deloitte Development LLC. All rights reserved.

24 Sources of college shopping advice for parents and children this back-to-college season In general, where are you [parent] and your children most likely to get back-tocollege shopping advice? 80% 74% 70% Parent 60% 50% 55% 53% 54% 42% 46% 39% 38% 51% Children 30% 24% 22% 26% 20% 10% 17% 14% 13% 13% 4% 8% 10% 11% 9% 8% 0% From the college/university itself Online (i.e., blogs, online reviews, etc.) Friends Family members In-store product displays Social media Mobile phone Newspapers Catalogs Television Magazines 24 Sorted in order of parents; options below 9% for parents not presented Copyright Deloitte Development LLC. All rights reserved.

25 2 in 5 (43%) families plan to use social media sites in their back-to-college shopping Do you or your children plan to use social media sites to assist in your back-to-college shopping? 50% % 45% 42% 43% 35% 30% 25% 20% 15% 10% 5% 0% Trend for the use of social media remains the same compared to last two years 25 Copyright Deloitte Development LLC. All rights reserved.

26 Almost half (47%) of respondents indicated that their college-going child owns at least one credit card How many credit cards do your college-going children own? 0 52% 63% 59% 1 32% 37% 38% 2 3 or more 4% 4% 7% 1% 0% 2% % 10% 20% 30% 50% 60% 70% 26 Copyright Deloitte Development LLC. All rights reserved.

27 smallin Augustlate Shopping time has shifted to proportion as compared with last two years Whenareyoulikelytodothemajority of your back-to-college shopping? July 19% 19% 18% Early August 60% 62% 55% Late August 19% 17% 24% September October 2% 2% 2% 0% 0% 1% % 10% 20% 30% 50% 60% 70% 51% of parents will complete their college shopping less than a month before the college year starts 27 Copyright Deloitte Development LLC. All rights reserved.

28 #Back2School15 This publication contains general information only and is based on the experiences and research of Deloitte practitioners. Deloitte is not, by means of this publication, rendering business, financial, investment, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte, its affiliates, and related entities shall not be responsible for any loss sustained by any person who relies on this publication. Copyright Deloitte Development LLC. All rights reserved. Member of Deloitte Touche Tohmatsu Limited