People walk on the campus of the University of North Carolina Chapel Hill on June 29, 2023 in Chapel Hill, North Carolina.
Eros Hoagland | Getty Images
Over the past few years, Alicia Browne has noticed a change in what college students haul out of cars on move-in days on the University of Alabama.
Together with pillows, comforters and laptops, more students arrive with mini-fridges, headboards, Keurig coffee makers and even air purifiers. Some hire decorators who drop off linens, custom-made curtains and other furniture or decor orders on a particular vendor delivery day that the university created.
“It [dorm spending] has grown during the last decade, but since Covid, I feel it has really exploded,” said Browne, the university’s director of housing administration for about 13 years.
The back-to-college spending bump could be considered one of the most important sales opportunities for retailers this fall. College students and their families are expected to shell out a record amount this 12 months: a mean of about $1,367 per person, in line with an annual survey conducted this summer by the National Retail Federation and market researcher Prosper Insights & Analytics. That figure has shot up by about 40% since 2019, in line with the survey.
Browne credits the influence of TikTok videos and other social media posts that showcase fancy dorms for a number of the spending increase. As well as, parents do find themselves wanting to splurge on children who didn’t experience typical college socialization through the pandemic.
“There is a definite sense from parents and families that their students missed out on things due to Covid, that there is a have to perhaps help make up for missed experiences,” Browne said. “I do think a part of that’s attempting to ensure their student is as comfortable as possible, as successful, that their start to highschool goes to be the very best it possibly might be. And that involves their living situation and families are willing to pay for it.”
The back-to-college boom also creates a probability for retailers to draw and create ties to a recent generation of younger shoppers.
“You are establishing a relationship at a vital and vulnerable age,” said Marshal Cohen, chief retail advisor for Circana, a market researcher formally often called IRI and The NPD Group. “A robust retailer will retain that relationship over time.”
This 12 months that spending and people closer ties could especially help firms like Goal, Walmart, Kohl’s and others which have said more frugal shoppers are buying fewer big-ticket or discretionary items like clothing, electronics and furniture. Those retailers will likely share some early insights about sales trends once they report earnings in the following couple of weeks.
Yet the back-to-college sales alone may not overcome retailers’ other challenges. Many firms, including Best Buy and Macy’s, expect sales to fall this fiscal 12 months as higher priced groceries pressure wallets and consumers favor spending on experiences reasonably than store-based products.
Some forecasts for the brand new school 12 months aren’t as rosy because the NRF estimates. Consulting firm Deloitte predicted back-to-school spending for kindergarten through highschool students will drop 10% 12 months over 12 months to $597 per student, as consumers deal with buying necessities and select retailers with lower prices or more deals. It didn’t forecast back-to-college spending, nevertheless.
Households aren’t just expecting to spend more due to inflation, in line with the NRF’s back-to-college data. Survey respondents also said they expect to purchase more recent merchandise and big-ticket items like electronics and furniture than they did last 12 months.
A growing pie — and market share up for grabs
As college spending is poised to grow, retailers have another excuse to vie for college students’ dollars. This fall marks the primary back-to-school season since Bed Bath & Beyond filed for bankruptcy and shuttered its stores, forsaking market share for others to grab.
Together with its 20%-off coupons, Bed Bath established a robust status for being a one-stop shop for faculty. It carried numerous items that students needed, including “bed in a bag” sets that typically included an identical comforter, sheets, pillowcases and sometimes pillow shams. Bed Bath also allowed families to purchase items at their local store and pick them up at a location near their campus in one other state or city.
Bed Bath & Beyond logo is seen on the shop in Williston, Vermont on June 19, 2023.
Jakub Porzycki | Nurphoto | Getty Images
It’s difficult to estimate Bed Bath’s total college market share. The corporate reported revenue of $1.44 billion within the quarter that ended last August. That included sales from other merchandise categories and its chains BuyBuy Baby and Harmon.
Those dollars may now go to retailers like Amazon, TJX-owned HomeGoods and Ikea.
Cristina Fernandez, a retail analyst for Telsey Advisory Group, said she expects Goal to be considered one of the massive winners of Bed Bath’s market share. She cited the retailer’s student-friendly items from decor to toiletries and food and its similar locations with loads of stores near college campuses.
She said the NRF’s forecast seems high, but added families have been willing to splurge on students.
For instance, she said, the pricey Pottery Barn Teen brand owned by Williams-Sonoma teamed up with LoveShackFancy, a Recent York City-based retailer known for frilly and floral designs that caters to shoppers at stores within the Hamptons and on Madison Avenue.
Other retailers have also gotten creative to woo college customers.
Williams-Sonoma’s namesake brand debuted an internet site landing page of kitchen items for college students establishing their first apartment or a shared kitchen in a dorm.
Walmart and Goal have featured a big mixture of college-friendly items on their web sites and social media pages, from fuzzy throw pillows to retro-inspired mini-fridges. Shipt, the Goal-owned delivery service, and Walmart have each tried to draw more college students to their membership programs by offering a special discounted price.
Goal has also worked with college-aged TikTok influencers on videos that showcase dorm decor.
At The Container Store, shoppers will see some merchandise from Dormify, a direct-to-consumer retailer, at pop-up shops and online.
Dormify co-founder Amanda Zuckerman began the web retailer due to frustrations she had when purchasing for her own dorm decor at Bed Bath & Beyond.
Now, Zuckerman said Dormify is attempting to turn Bed Bath’s closure right into a business advantage. She said its average order value has risen 15% 12 months so far.
She said the corporate’s growth has been fueled by college students who want uniquely decorated rooms that reflect their personalities. They’ve sprung for items that weren’t on shopping lists years ago, including temporary wallpaper, neon signs and gadgets like matcha machines and makeup fridges.
Social media has amplified the trend. Now, individuals are showing off their dorm room to the world, not simply to hall mates.
“The bar has been raised and I feel that has so much to do with TikTok,” she said. “That is really all there’s to it.”
‘A silent competition’
Kate Reppeto goes into her senior 12 months at University of Mississippi. She said she tries to get creative and watch the budget while decorating, but has seen other students blow out the budget.
Callie Weathers
Kate Reppeto, an incoming senior at University of Mississippi, has gotten creative and stretched her dollars as she’s decorated her college housing. The 22-year-old moved in last weekend to the four-bedroom house that she is going to share with three friends near the varsity’s Oxford campus.
Repetto, who’s returning to the home she lived in last 12 months, said she’s reusing much of her furniture and decor. That features a favorite item: a fluffy white bean bag that she got from a yard sale. She hung up a cow painting, which reminds her of growing up in Southlake, a suburb of Dallas-Fort Price in Texas.
She said she plans to purchase some recent items, equivalent to clothes from Lululemon and American Eagle-owned chain Aerie, together with makeup. She recently bought a blender from Goal. Repetto said she’s attempting to follow spending not more than $400 .
Yet she said that is below the quantity that she’s seen other students spend. The primary 12 months of school she said she had to withstand pressure to blow her budget.
“It was almost like a silent competition,” she said. “Who has the nicest looking dorm or the prettiest dorm.”
Dorm Decor helped decorate this room. The Birmingham, Ala.-based company can monogram items and even has an in-house artist that may match students’ decorations.
Anna Emblom
Those splurges have created a business for decorators like Dorm Decor, a Birmingham, Alabama-based company that acts as each dorm retailer and interior designer. It makes a speciality of dorm-friendly headboards, bed skirts, storage ottomans and giant pillows called Dutch Euros.
Elizabeth Edwards, sales and marketing manager at Dorm Decor, said families are inclined to spend between $500 and $2,500 per child. She said the corporate offers plenty of options and private touches, including pillows that are available hot pink or tiger stripes, items that may be monogrammed and custom-made paintings by an in-house artist that may match students’ decorations.
She said parents across geographies and income levels turn to the corporate because they wish to turn their child’s sterile rooms and “prison-type mattresses” right into a feeling of home.
“It doesn’t matter their income,” she said. “They need their child to be comfortable like the following person.”