With this significant milestone, retail brands started advertising earlier and spending more this year. According to our data, programmatic spend for retail brands between July and August is up 190% from last year. 

Here is a brief look at some highlights from this back-to-school season and the top programmatic retail spenders.

Brands capitalize on back-to-school excitement

After more than a year of doing school online, most American students and parents will be full of emotion to start in-person classes again. And marketers are pulling on that for their creative messaging. 

American Eagle is running a campaign highlighting friends being together again. The “Future Together. Jeans are Forever” ad features actors Caleb McLaughlin and Jenna Ortega, as well as major social media influencers. In addition to the TV ad campaign, the popular retailer will be taking advantage of Snapchat’s AR try-on features and creating a Bitmoji clothing line.

Kohl’s is running a sentimental ad showing a dad dropping off his son at school on his first day, with the son saying, “Have a great first day Dad.” This points to how the back-to-school season is affecting the entire family as we transition back to pre-pandemic routines. 

“Pretty much every kid in America is going to be back to in-person school,” explained Greg Revelle, chief marketing officer of Kohl’s to AdAge. “What was an uncertain environment last year, now we know and people are excited about it.”

And Target is keeping their creative particularly upbeat with its “But First, Target” ad.

We’re not only seeing new themes in back-to-school creative. Companies have been innovative with how they spend and the formats they use. DoorDash is giving away 5,000 full backpacks as part of a campaign bringing attention to the fact that they now deliver goods other than food. And General Mills is using mobile rewards to encourage eCommerce purchases.

As brands transition back into more predictable patterns, we’re seeing them blend previous messaging (traditional supplies and clothes are in demand compared to computers and tech solutions from last year). But the pandemic has still left its mark. Many brands are pouring their resources into social, mobile and other forms of digital. 

Who are the biggest programmatic spenders?

MediaRadar Insights

Overall programmatic retail ad spend in July and August totals $1.32bn. As mentioned previously, this is up 190% from 2020, when spend was $454.1mm in the same period.

The top back-to-school advertisers include: Amazon, Target, WalMart, Gap and Kohl’s.

For more specific breakdowns of these advertisers’ spending, see their advertiser profiles (linked above).

As retail and eCommerce continue adjusting, we’ll keep you updated on the latest trends. 

For more updates like this, stay tuned. Subscribe to our blog for more updates on coronavirus and its mark on the economy.

Some students returned to school with masks and hand sanitizer, while others joined Zoom calls. Another 20-30% of students are experimenting with “hybrid schooling.” 

This rearrangement of schooling options forced parents to switch up their back-to-school shopping lists.

A couple of weeks ago we shared how this odd back-to-school season impacted advertising. Now we take a look at how those advertisers specifically utilized programmatic as part of their campaigns.

We encourage you to subscribe to our blog for the latest data surrounding the advertising industry. We will provide daily updates as COVID-19 continues to make its mark on the US economy.

Back-to-school buying goes in a new direction

With many students doing virtual or hybrid schooling, traditional back-to-school sales are suffering.

The Children’s Place—the only pure play children’s retailer growing in market share—predicted that its Q3 revenue would drop about 25-30%. 

“We don’t anticipate that there will be a catalyst to drive any back-to-school meaningful business until Spring ’21 at earliest,” said President and CEO Jane Elfers. “We’re not looking for anything to happen in the later half of the year or in the fourth quarter to drive back to school sales.” 

The lack of returning to school and seeing friends curbed the excitement of buying new clothes this year. Plus, there are more expensive items on the shopping list, forcing parents to reexamine their budgets. 

Back-to-school budgets reallocated to tech and office furniture

Even though parents aren’t spending the normal amount on clothes or school supplies, it doesn’t mean 2020 will be a frugal back-to-school year. Actually, it’s the opposite: It’s likely that spending will reach record highs according to the National Retail Federation.  

Why will spending be up? Many parents will buy new tech, office furniture, and supplies to set up a homeschooling space for their children. 

Parents with children in grades K-12 are expected to spend an average of $789.49 this year, which is up from $696.70 last year. 63% of these families will buy computers or other electronics.

In addition to tech, parents are buying desks and office furniture. Between mid-July and August, the term “kids desk” rose 3783% and “computer desk” increased 257% on Amazon, according to Profitero. However, unfortunately for parents, there is a shortage of furniture and many items are backordered.

College students will likely be needing non-traditional items as well. Bed Bath & Beyond launched a college-at-home program to help students revamp their childhood bedrooms. 

Likewise, Kohl’s back to school headline is “Heading back or logging in, the new year starts here.” It’s important to note that hand sanitizer and facemasks are featured heavily—pointing to the fact that college life will not yet be fully normal.  

MediaRadar Insights 

Methodology 

We analyzed programmatic ad spend in July and August year-over-year (YoY).

Findings

Overall, programmatic retail ad spend during the back to school season decreased 7% YoY, which is much better than the -31% felt across all ad formats. Print felt the worst impact from slow back-to-school ad spending.

Unlike the overall market, programmatic back-to-school advertising is not as concentrated, with the top ten spenders making up 44% of all programmatic spending.

Of the top ten back-to-school advertisers, only three raised their programmatic budgets YoY:

• Amazon: +117%
• Walmart (+12%)
• Kohl’s (+17%)

Others—Best Buy, Target, and Office Depot—cut their programmatic ad spending amid this odd back to school season.

Advertisers were forced to adjust their messaging. Walmart is running a campaign acknowledging both kids going back to school and kids staying home. Meanwhile, Target’s commercial is focused on schooling from home, with tech playing a heavier role.

This is just the beginning to an uncertain end of the year. As the holiday season approaches, we’ll be tracking advertising trends as advertisers finish out 2020.

For more updates like this, stay tuned. Subscribe to our blog for more updates on coronavirus and its mark on the economy.

This is creating a strange back-to-school season, putting stress on retailers. How have the changes impacted retailer advertising?

We encourage you to subscribe to our blog for the latest data surrounding the advertising industry. We will provide daily updates as COVID-19 continues to make its mark on the US economy.

Back to School Season is Abnormal in 2020

Sending children back to school was one of the most difficult decisions for government officials and parents—and there isn’t a uniform policy across counties or states. 

This is impacting retailers, as each location is different. The Children’s Place reported that in 47% of the cities in which they have stores, schools are going virtual. In an additional 35% of their markets, schooling will be hybrid. Because of this, they do not expect the normal back to school sales bump, and predict Q3 revenue will decline 25-30% YoY. 

Likewise, traditional back-to-school supplies are down 31% nationwide, according to Shopper-Intelligence company Catalina. This will impact grocery stores and pharmacies in areas where the pandemic had the greatest influence: California, Florida, Texas, New York, and Georgia.

Reallocating back-to-school dollars to tech

Instead of clothes, many parents will direct their back-to-school spending towards necessary tech items for remote learning, like computers and tablets. 

According to the National Retail Federation, 63% of K-12 families are expecting to buy computers or other electronics this year, up from 54% last year. They plan to spend an average of $274.44. Overall, the report says that COVID may push back-to-school spending to record-level highs. It’s just that the spending will be on tech, rather than apparel and supplies.

Apple agrees. 

“Mac and iPad, these are productivity tools that people are using to stay engaged with their work or stay engaged with their schoolwork,” said Apple’s Chief Executive Tim Cook on a recent earnings call. “And we believe we’re going to have a strong back-to-school season sitting here today, it certainly looks like that.”

Remarketing the college experience amid COVID

Even for university students, “going” to college (or logging in) will be odd. Bed Bath & Beyond launched a college-at-home program to help kids revamp their childhood bedrooms, featuring product lines like “dreamy dorm spaces” and “low-key bohemian.” 

The idea is to encourage students to make their rooms “more effective and more exciting to them even if they can’t be on campus,” said Joe Hartsig, chief merchandising officer at Bed Bath & Beyond to The New York Times. “It’s a real window of change for students to reflect that they’ve moved on from high school and are in college, and want their room to reflect a different room.”

MediaRadar Insights: Advertising trends amid this strange back-to-school season

Methodology

To understand how these trends were impacting advertising, we analyzed retail ad spend from the beginning of July through the first half of August (August 23rd). We looked at data from TV, digital, and print ad spend.

Our Findings

Overall, retail ad spend during this time period was down 31% YoY—paralleling nationwide sales figures for supplies. Though this figure is down, it is important to note that this spending level is much improved from where it was in the earlier days of the pandemic. For example, in mid-April spend levels were down by more than 60% YoY.

Because retailers normally advertise back-to-school sales in mediums like local newspapers, print advertising is feeling these cuts the most. Digital ad spend from these retailers is actually up 4% YoY. This is not surprising, considering that programmatic has done well amid the pandemic. People are spending more time online and shopping online—it’s unsurprising that ad placements have shifted to digital. 

More than half of all retail ad spend during the back-to-school season came from the top ten advertisers. These advertisers are faring only slightly better than others: YoY their ad spend is down 29% YoY. Between July and August 23rd, they spent almost $275M on advertising.

Of the top ten advertisers, four increased their ad spending YoY. These four include:

• Walmart
• Amazon
• Gap
• IKEA

Collectively, their spend is up 46% YoY.

On the other hand, the remaining top ten spenders (Target, Macy’s, Kohl’s, Staples, J.C. Penney, & Best Buy) collectively cut ad spending by 56% YoY.

In response to the ongoing pandemic, advertisers adjusted their creative. For example, Walmart is running a campaign that acknowledges that some kids are going back to school and some are staying home. Meanwhile, Target’s commercial is focused on schooling from home, with tech playing a heavier role.

There are many oddities to this back-to-school season—and this is just the start to a weird end of the year as we enter Q4. As the holiday season approaches, we’ll be tracking advertising trends as advertisers finish out 2020.

For more updates like this, stay tuned. Subscribe to our blog for more updates on coronavirus and its mark on the economy.