7 Back-to-School Advertising Trends from July 2018
In July 2018, despite a 6% year-over-year decline in overall retail advertising spend to about $600 million due to shifts away from print and TV, the back-to-school season remained the second largest shopping period with over 4,000 companies advertising, intensified early by Amazon's Prime Day, and concentrated spending among a few top retailers competing against brick-and-mortar stores amid changing consumer behaviors.
School is back in session. Kids have already been handed their class schedules and assigned to a seat. Students are fully prepared with their new backpacks, pencils, pens, rulers, notebooks, and calculators. But, how did they make their back-to-school purchases and whose advertising grabbed their attention and dollars?
The State of Retail
A lot has been written about the state of retail in the United States in recent years; brick and mortar sales are lagging and, as a result, many stores have closed. This decline in sales can be attributed to the fact that consumers are deciding to make their purchases online and that industry disruptors, such as Amazon, are changing the landscape.
Back-to-School and Black Friday Shopping Seasons
Despite these transformations, the back-to-school season is still the longest and second biggest shopping season of the year. Black Friday is ranked number one. It’s a huge opportunity to capitalize on for those in the retail industry.
Amazon vs. Brick-and-Mortar Stores
But, lately, more and more fierce and innovative competitors like Amazon have entered this market. The American electronic commerce and cloud computing company created Amazon Prime Day on July 19th, forcing other retailers to kick-start their back-to-school campaigns even earlier in the summer. To get a better sense of early back-to-school advertising in the retail landscape, MediaRadar dove into the seven different categories of July advertising activity.
7 Categories of July Back-to-School Advertising Activity
- 1.
In the retail category as a whole, over 4,000 companies advertised in July 2018, collectively spending an estimated $600 million across national TV, print, and online channels. Compared to July of the previous year, advertising spend was down 6% year over year, as the category shifted dollars out of print and TV channels.
- 2.
Over a third of July retail spend was consolidated around seven of the top retail advertisers, accounting for over $210 million in spend. Ad spend increased slightly year over year by just 1% for these seven specific companies, including Target, Walmart, Macy’s, Kohl’s, Amazon, IKEA, and Best Buy. These retailers were ranked by total estimated spend across all three channels – national TV, print, and online.
- 3.
Looking at total spend across all three channels, three of these companies increased their ad spend year over year, while another three decreased their spend. Only one remained flat.
- The three companies who are up: IKEA (+46%), Amazon (+42%), and Target (+8%)
- The three companies who are down: Walmart (-16%), Best Buy (-11%), and Kohl’s (-3%)
- Macy’s has remained flat year over year
- 4.
The two companies who most significantly increased their spend year over year were IKEA and Amazon, both with large investments in TV campaigns. Each increased their year over year TV spend by over 65% while running back-to-school ads.
- 5.
The company who changed their media buying strategy the most year over year was Best Buy. In July 2017, the company ran ads across all three channels. However, in July 2018, nearly all of Best Buy’s spend moved to digital and online channels.
- 6.
Among these seven retailers as well as the retail category as a whole, the channel which saw the most growth was online advertising. Notably, Best Buy, Kohl’s, and IKEA more than doubled their online ad spend year over year.
- 7.
Two companies also ran back-to-school ads on Snapchat; Walmart, who owns Jet.Com, ran ads directly geared to college students while Amazon was promoting Amazon Teen, as well as running a Prime Day lens on days close to July 19th. Target and IKEA also ran Snapchat ads during the month of July, although they were not exactly related to the back-to-school season.
Conclusion
The landscape of retail is changing. More specifically, the back-to-school season is starting earlier and earlier. While Amazon may be slowly taking over, big brands such as Target, Walmart, Macy’s, Kohl’s, Amazon, IKEA, and Best Buy are still in the game. Online advertising is growing rapidly, but TV advertising and digital are still considered wise investments. Snapchat is also an up-and-coming option for back-to-school advertisers.
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