Teen Buying Spree : Retailers Study Up for School Days
Not too many corporate executives read Seventeen and Young Miss magazines, but Mark D. Rexroat devours every issue. He watches a lot of music videos on MTV, too. And every winter, he crisscrosses the country checking out such places as Venice Beach, where he combs funky gift shops for clues to “what the teen-age fashion trends will be a year from now.”
The colors and characters that Rexroat discovers find their way onto the covers of thousands of notebooks, binders and portfolios that America’s youngsters are lugging to school this fall. His efforts may seem extraordinary, but to his employer, Mead Corp., and retailers across America, big bucks are at stake.
Every fall, parents and children spend about $750 million on school supplies, and billions more on clothes, shoes, sweaters, backpacks, pocket calculators and, of course, those essential extras: sweatbands, barrettes, charm necklaces and cassettes.
Fierce Competition
This ritual may seem as ever-present as school itself. But for the past 14 years, the number of children attending school in the United States has been dropping steadily. As a result, retailers have had to compete fiercely for shares of a shrinking pie. Even notebooks have to be trendy.
But this fall, the number of elementary schoolchildren is edging upward slightly, and this trend is expected to continue through the 1990s. For instance, when school starts today in the Los Angeles Unified School District, there will be an estimated 15,000 more students than last year--the largest increase in enrollment since 1964.
The nation’s department stores and discount retailers reported last week that sales were up 6.7% in August compared to the year before, and they pronounced the back-to-school buying spree off to a good start. At the same time, some manufacturers say the new school enrollment figures are making them pay increased attention to the children’s market. For the nation’s retailers, it seems that back-to-school may be increasingly back-in-style.
‘Demographic Trends’
One company looking more seriously at the children’s market is Lee Jeans, the nation’s No. 2 maker of denim slacks. Lee sells 40% of its jeans during the back-to-school season, mostly to teen-agers. But Lee President Malcolm Winne said the company is now exploring ways to focus on the children’s wear. “We can’t ignore the demographic trends,” he said.
Some companies that have devoted more resources and imagination to children’s wear appear to have achieved success. Nike, a maker of athletic shoes, said sales of children’s sneakers jumped 22% last year. This back-to-school season the company is promoting sneakers with night reflector strips through guest appearances of a costumed Reflecto-Man at shoe stores. And at Oshkosh B’Gosh, sales of fashionable children’s clothing have overtaken sales of men’s work overalls, the company’s original product.
At K mart, executive Robert D. Moore, who oversees boys’ clothing departments, said sales of boys’ clothing stagnated until the chain put traditional flannel shirts on the back shelves and featured colorful, oversized sweat shirts instead. Moore said by the time they turn 9, even boys “have very definite ideas about what they want to wear. If mother doesn’t buy the garment the boy wants, it’s going to end up not being worn.”
The new focus on children has not diminished the attention lavished on the nation’s teen-agers who--industry analysts say--spend nearly every dollar they get their hands on. A 1986 survey by the Rand Youth Poll shows that teen-agers are enthusiastic consumers. According to the survey, teen-agers receive about $30.7 billion a year in wages and allowance from parents, and spend $25.7 billion.
Splashy Ads
Much of that money is spent at this time of the year as merchants beckon the young shoppers with opulent displays, splashy advertising and even parties at Disneyland. According to Seventeen magazine, girls between age 13 and 19 spend $8.7 billion on back-to-school clothes, shoes, notebooks, calculators and other items. That comes to $1,023 for each girl.
Esprit is one of those companies cashing in on teen-age buying. The trendy clothier mailed about 1.2 million colorful brochures to teen-agers this fall, including 100,000 to California teen-agers. “We find that kids have a definite say on what they want to wear; a much clearer view on what they want than their parents do,” executive Bonnie Pyle said.
“When I was a kid, my mother took me shopping for school clothes, but that’s not what happens in today’s world,” said Halle Redman, the buyer for junior clothing at the Broadway, a department that features in-store videos and pulsating rock music for the back-to-school season. “Most kids today go shopping on their own and buy what they like. So we direct our marketing at the consumer.”
Disneyland Party
As part of that effort, the Broadway is throwing a gigantic back-to-school party for its teen-age shoppers at Disneyland. On Sept. 12, about 3,500 teen-agers who purchased tickets will be treated to five hours of music videos, dancing, a fashion show and a chance to win a car, a color television or a shopping spree.
Contempo Casuals, a national chain that sells trendy clothing to teen-age girls and women, threw a party for its store managers to get them excited about back-to-school sales. In mid-July, the company flew 200 store managers to Los Angeles for a party and back-to-school sales seminar at its headquarters. The sales managers were told how to help teen-agers pick out accessories and coordinate outfits. “When the girls leave, they are incredibly motivated,” said Eve Rich, Contempo chief executive.
The six-week school shopping season is important to retailers, and not only because sales are so huge. The season provides an important indication of the strength of fall and winter sales, with the crucial Christmas buying season. If back-to-school sales are poor, Christmas sales usually are too, said Monroe Greenstein, a retail industry analyst with the Bear Stearns & Co. investment house in New York. “If consumers aren’t willing to buy the merchandise for back-to-school, they’re not going to want it at Christmas either.”
Looking Toward Christmas
This year, the nation’s major retailers reported healthy back-to-school sales, and retailers say they are looking forward to Christmas. Edgar S. Mangiafico, chairman of May Co. California, predicted a “good” Christmas this year based on early back-to-school results.
Though the back-to-school market is a lucrative one, it has also been unpredictable. Many retailers and manufacturers say it is difficult to plan for the school buying season because children and teen-agers are fickle customers. One cartoon hero or sports star worshiped this year may be forgotten the next; manufacturers say singer Michael Jackson is one example. “Some people call this Russian roulette,” said Sandy Saemann, executive vice president of L.A. Gear, a footwear manufacturer that derives about 35% of its $45 million in yearly revenue from back-to-school sales.
Saemann knows this from experience. After noticing the bicycle explosion in Southern California, L.A. Gear introduced a stylish bike shoe nationwide last fall. It flopped. “We were a year ahead of ourselves,” Saemann said. The bike shoe is doing well this year, he said.
2,000 Children Surveyed
Even school supply makers pay attention to fashion trends. Rexroat said Mead surveys up to 2,000 children in high schools, primary schools and in shopping malls, asking them to choose among 150 possible designs and soliciting their suggestions. Then the company selects between 10 and 15 new designs a year, and tends to stay away from rock music stars. “By the time the fall comes, that star could be completely out,” he said.
Retailers sometimes change their plans at the very last minute when they spot a new teen-age trend. “One of the things we believed in early on was denim dressing. . . . But when we first started talking about it, we didn’t mean glitzy denim,” said Redman, the Broadway buyer for junior clothing. In late spring, Redman spotted an emerging trend in fashion denim--jeans and skirts decorated with glitter and beads. The store had to act quickly to order the clothing so that it would be in the store before the back-to-school season started, Redman said.
It’s not always enough to realize what the teen-agers want. Take the case of K mart. The buyers at the nation’s second-largest retail chain correctly guessed that oversized, puffy sweat shirts would be in demand this fall. “The trend took off like a rocket,” said Rick Pellino, senior buyer for girls’ wear for K mart. “We didn’t have enough.” Pellino said the shirts were sold out of the chain’s 2,100 stores during the first two weeks of August. The new order won’t arrive until back-to-school season is over, he said. “We’d like to have more, but we just can’t.”
Impact of Children
Younger children also seem to know what they like. Retailers say that as the number of elementary schoolchildren increase, they will have a greater impact on back-to-school sales. This month, about 31.2 million youngsters return to school in kindergarten through eighth grade, a gain of 251,000 from last September, according to the U.S. Department of Education. By 1993, the government estimates that number will grow to 35.8 million.
Craig Wilson, the product manager for school lunch boxes at Thermos, said he takes more than a casual interest in Saturday morning cartoons. The company sells 90% of its lunch boxes during the six-week back-to-school season, and sales depend on having the right toy or cartoon character on the box.
“We have to be aware of what the kids are watching,” he said. This fall, Rambo and Pound Puppies are in, he said, and Cabbage Patch Kids and Rainbow Brite are on the way out.
And, he added, children tend to buy new lunch boxes each year so they can have the latest cartoon character. Schoolchildren want “to have something new and fresh . . . the newest and most exciting,” he said.
And they want the clothes that teen-agers are wearing. “Kids today want fashion and color and they want to be in style,” said Eugenia Battle, a merchandise manager for J. C. Penney in Hawthorne who said teen-agers are influenced by such TV shows as “Miami Vice” and MTV. “And the little kids all want to look like the big ones.”
