Stella McCartney RTW Spring 2021
Klarna’s data also suggests that this year’s back-to-school shopping season may be serving as a time for the whole family to refresh their wardrobe with new fall fashion. Demographic data from Klarna’s app showed an increase in spend in the clothing category around the back-to-school season driven specifically by Gen Xers and Baby Boomers.
A recent report from McKinsey found that over 75 percent of shoppers have tried new brands, places to shop, or methods of shopping during the pandemic. While Siemiatkowski said Klarna’s U.S. customer base is approximately 70 percent Millennials and Gen Z consumers, the company has seen an increase in Gen Xers usage as stay-at-home measures continue and people become more comfortable with online shopping.
A family affair
“Buy now, pay later has fortunately enabled cross-generation usage of online shopping and payments,” said Siemiatkowski. “Kids are not the only ones getting a wardrobe refresh before the school year begins. We saw a 24 percent increase in the family clothing category from the last week of July to the first week of August, with Boomers and Gen Xers contributing in large part to the overall increase.”
“Baby Boomers accounted for the highest percentage of the uptick in clothing and apparel sales during this timeframe,” said Siemiatkowski. “Shoppers in these generations appear to be increasing their use of buy now, pay later services such as Klarna, and we believe there is an opportunity for our retail partners to reach wider audiences across older generations.”
Concurrently, findings from Deloitte’s 12th annual back-to-school survey found consumers plan to spend $10.4 billion online this season, increased from $8.1 billion in 2019. According to the company, consumers were reconsidering plans around the annual ritual of back-to-school shopping but were found to be shifting rather than dissolving plans to shop.
“College students across the country are ready to return to campus, but continued health, safety, and financial concerns are weighing on families,” said Stephen Rogers, executive director, Deloitte Insights Consumer Industry Center, Deloitte LLP. “As such, parents plan to give their children as normal a college experience as possible with consistent spending for electronics, household products, clothing, and traditional supplies. As parents adapt to the new realities of the pandemic, online shopping is poised to make up a greater percentage of back-to-college purchases, with convenience and safety being more important components of this year’s shopping experience.”
A similar study, conducted by Engine Insights on behalf of ICSC in late July, found the average consumer is expected to spend an average of $1,053 on back-to-school related items, which is up approximately $200 from last year, with an expected increase in spending on electronics and furniture. Tom McGee, president and chief executive officer of ICSC, said, “It is encouraging to see consumers planning to spend more on back-to-school this year, especially in light of the uncertainties brought on by the pandemic. Ultimately, the goal is for students to resume their education safely and effectively.”
Notably, authors of the report foresee the ongoing uncertainty amid the pandemic extending the back-to-school shopping season, as 55 percent of consumers intend to make several trips to stores for items, and 58 percent of spending expected to happen in August and September.
Klarna serves over 86 million shoppers and 200,000 retailers around the world. Courtesy Image.
“What’s interesting about the most recent data from the Klarna app is that even in the context of a global pandemic, we are still seeing a significant back-to-school trend emerge,” said Siemiatkowski. “Parents are shopping for new season apparel and footwear not only for themselves but also for their kids. This suggests a need or desire to refresh wardrobes for the fall season, despite the fact that many families are still working and schooling from home. The uptick in back-to-school spending may also be explained by the obvious need to replace clothing for kids as they grow.”
As a category, clothing and accessories purchases were up by over 12 percent on Klarna’s app over the last week of July to the first week of August. Children and infant clothing, in particular, saw a 36 percent increase week-over-week, with The Children’s Place seeing a 50 percent increase and Carter’s Inc. experiencing a 26 percent increase.
According to key retailers within the children’s category, trends are continuing to emerge as parents balance back-to-school needs with safety concerns and new consumer behaviors.
“For this back-to-school season, we see our customers making purchases in key product categories like everyday playwear, leggings and tees for comfort, children’s face masks continue to be an in-demand item week after week, as well as pajamas. ‘PJs all day,’ continues to be a comfy option for kids and parents alike,” said Kendra Krugman, executive vice president of merchandising and design at Carter’s Inc. “We have remained thoughtful about what both parents and children really need right now, and we continue to evolve with our families – from patterns and designs to ensuring inventory and the ease of the shopping experience.”
“The back-to-school timeframe is particularly fun for Old Navy as we see kids looking for clothes that are fashionable, functional and above all comfortable,” said Andres Dorronsoro, senior vice president and general manager of merchandising at Old Navy. “This year is no different, despite school diverging from its typical format for many kids across the country. Comfort is still key and we’re using fabrics that are washed and comfortable against the skin whether it’s for a Zoom class or in-person learning, playing, or relaxing at home.”
The biggest trends for back-to-school and fall, Dorronsoro said, included matching fleece sets, playful graphic tops, elevated joggers, and activewear worn with lifestyle pieces for every day, with novelty prints, tie-dye and camo patterns found across the assortment, mirroring trends that emerged during the stay-at-home quarantine.
As a retailer that notably serves the entire family, Dorronsoro said Old Navy is “seeing similar trends excel for the entire family, again with comfort – fleece sets, in particular, are ranking as a top must-have.”
The Klarna app has added 1 million new consumers in the U.S. within the last three months. Courtesy Image.
The cool kids
Data from Klarna also found that shoe stores have experienced an uptick around back-to-school shopping with Foot Locker, Puma, Zappos, and Kids Foot Locker leading for an overall 16 percent week-over-week in the first week of August.
“Back-to-school 2020 continues to see the consumer trends focus on premium, classic lifestyle footwear and apparel as a defining look for 2020,” said Chris Santaella, vice president and chief product officer at Foot Locker, Inc. “Premium and versatility continue to be important to the consumer. They want the best of the best, but the product has to be versatile to allow them to navigate through balancing the ‘new norm’ of today’s environment. Culturally connected storytelling has been a key to elevating the top models from the past to a new consumer base, who wants more from the product than just superior style.”
Top wish-listed items on the Klarna app included women’s and men’s Nike Air Force shoes, kids’ Adidas Lite Race Adapt white shoes and Adidas’ Trefoil baseball cap.
The recent addition of wish lists on the Klarna app makes shopping inherently more social for users, allowing shoppers to create, share, follow, and shop from any online store. Since the wish list feature launched on the Klarna app last summer, more than three million items have been added by customers.
“By providing our customers with the shopping experience they desired, we enhanced their experience with our brand and our retail partners,” said Siemiatkowski. “For retailers, wish lists not only help build social and community engagement into the consumer experience, but also serve as a rich source of data to better understand what shoppers want, ultimately leading to increased conversion.”
Notably, the wish lists also provide a peer-to-peer influencer element to the Klarna app while leaning into current social shopping trends driven by Gen Z users and allowing them to share most-wanted items and find inspiration with friends. This is important as Klarna’s holiday survey found that the vast majority of consumers actually prefer to get holiday shopping advice from friends and family (79 percent) than from social media influencers (21 percent).
“Throughout this year, we have noticed various trends emerge at different points in time, and as stay at home conditions loosened, the wish list items have also changed,” said Siemiatkowski. “More recently with the upcoming fall season, we noticed an uptick in wish-listed items such as athletic apparel from Nike, Adidas, Finish Line, and JD Sports. Overall, however, we have seen wish lists across categories such as home & garden, sneakers, personal care and beauty, sleepwear, and more emerge and change over time as customer needs continue to evolve.”
Source: Read Full Article