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Thursday, August 12, 2004

Shoppers return with kids in tow


Department stores have great expectations

By Randy Tucker
Enquirer staff writer

[photo]
Kate Ware gets ready to enter seventh grade by taking a shopping trip to Florence Mall Wednesday with her mother, Jenny Ware. Kate's mother expects to spend $300 to $400.
The Enquirer/ERNEST COLEMAN
The back-to-school shopping rush could put mall-based apparel retailers such as Cincinnati-based Federated Department Stores back on track after years of losing shoppers to discount chains and other off-price merchants.

And electronics retailers are poised to reap the benefits of increased spending by households with tech-savvy teens who have iPods, cell phones and hand-held organizers near the top of their back-to-school wish lists.

Recent surveys from one of the nation's largest shopping-center operators and the nation's largest retail trade group indicate tight-fisted consumers are ready to loosen the grip on their purse strings.

"The consumer is back, and they're not as concerned about price as they were a couple of years ago or even last year," said Ellen Tolley, a spokeswoman for the National Retail Federation, a Washington, D.C-based trade group that recently released its annual Back-to-School Consumer Intentions and Actions Survey.

That's good news for Federated and other apparel-oriented retailers, who have seen back-to-school clothing sales slump over the past few years as shoppers put off purchases or shopped for clothes at discount stores because of concerns about the economy.

"There's a lot of pent-up demand, and people are finding a little extra money this year simply because of their love of clothes," said Tolley. Back-to-school shopping, she said, is second only to Christmas in terms of sales volume.

Headed to the mall

Nearly every family with school-aged children, about 93 percent, intends to purchase clothes, planning to spend about $219 per child on average - up about 6 percent from last year, according to the Retail Federation survey.

And malls and shopping centers have been identified as the most popular back-to-school shopping destinations for clothes, according to another survey from The Macerich Co. - a California-based real estate investment trust that owns or operates 62 regional shopping centers across the United States.

According to Macerich's national Shopping in America survey, more than half of those responding planned to purchase clothes and accessories at department or specialty stores while only about 18 percent planned to shop for clothes at discount stores.

Jenny Ware and her daughter Kate, who will be a seventh-grader at Ockerman Middle School in Florence this year, hit the stores at Florence Mall on Wednesday afternoon in what has become an annual ritual of buying in bulk.

"I usually spend anywhere between $300 and $400 on back-to-school stuff for her," Ware said, turning to her daughter with a knowing smile. "We caught a big sale at The Buckle, but I still spent more than $200 on jeans and T-shirts and a winter coat for her. And we're just getting started."

The mother said her back-to-school costs have grown in stride with her daughter's taste in clothes.

"You have to come to the mall to find the clothes and brand names she wants now," Ware said. "Last year, she was in uniforms. I'll tell you, those were the good old days."

Gotta-have gadgets

While most parents and their children still spend the majority of their back-to-school budgets on clothes, spending on electronics has soared over the past several years and is expected to post a significant jump this year because of falling prices.

According to the most recent NPD Consumer Electronics Price Watch, a monthly survey from New York-based market research firm The NPD Group, the overall value of a basket of 27 key electronics items now stands at $12,362, down more than $1,000 since the start of 2004 and almost $2,600 since May 2003.

That represents a decline of 17.4 percent over the past year.

"When it comes to home computers, software and hand-held electronics, no one can argue that prices have gone down tremendously over the past few years, making them more affordable for most families," the Retail Federation's Tolley said.

"But cell phones and iPods are not considered essential items by most families, so the fact that people are spending on those items should be another confidence-booster for retailers."

According to the Retail Federation survey, back-to-school shoppers will spend an average of just over $100 on electronics and computer-related equipment this year - a 15 percent increase over last year and the highest gain in spending in any one category.

In addition to the sharp decline in prices on most electronics, student demand for such items has increased as the products have become more commonplace in the classroom, according to Stephen Baker, a spokesman for NPD Techworld, a division of the NPD Group.

"The needs of people when they go back to school have changed pretty considerably over the last few years," Baker said. "Now you need a notebook computer. You need an iPod. My data has shown that over the past couple of years, and last year especially, we saw a huge spike in sales from the end of July to the end of September, the prime back-to-school shopping season."

Baker said sales of notebook computers alone increased 50 percent during the back-to-school shopping period last year.

Overall, parents' back-to-school spending is expected to increase 7 percent over last year to nearly $14.8 billion, according to the Retail Federation.

Teens and preteens are expected to kick in an additional $884 million of their own money on back-to-school this year.

E-mail rtucker@enquirer.com




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