Those clucking about Wal-Mart’s woes may want to pay attention this month as American parents participate in the real reason they call it “the dog days of August”: the back-to-school spending binge. A new survey says that parents prefer Wal-Mart by more than two to one over the next closest retailer, Target.
So, despite recent uncertainty about its fundamental pricing and merchandising strategy, Wal-Mart is still perceived as the place to go for bargains on mundane stuff like backpacks, jeans and folders. The chain may have lost its edge, at least temporarily, as Americans’ default choice for “the lowest prices,” but its reputation for comprehensive selection clearly is offsetting that.
Helping Wal-Mart is the finding that U.S. parents want to hold the line on back-to-school outlays – not necessarily cutting back from last year but determined to spend their money more efficiently. Parents say that they’ll more likely turn to smartphone apps and social media to get information about merchandise, pricing – and deals.
Last year’s average spending was just over $600 per family with school-age children. This is the target amount again this year, according to the survey by BIGresearch, released by the National Retail Federation. Parents also report that they may delay some spending.
That brings them back to Wal-Mart, which has been completing the rollback of its failed change in strategy just in time to clutter the aisles of its Walmart stores in traditional fashion with truckloads of ridiculously priced stuff.
And while Wal-Mart and other discount merchandisers may benefit from the prevailing penurious mood, brands in other industries are likely to take a hit from American parents’ determination not to shortchange their youngsters as they head back to classes. Restaurant chains, for instance, will see cutbacks this fall, says a new study from American Express, with 53 percent of survey respondents indicating that they’ll spend less on dining out.
All of these expectations were forged, of course, before the stock-market turmoil of last week and fresh indications of tanking consumer confidence. If such harbingers of new weakness in the U.S. economy continue for much longer, the best place to look for a job in September might be your local Walmart store.