I just finished an article in the New York Times talking about the delay in the traditional Back To School spending many retailers count on, and the larger economy bets on for its overall health. I know we’ve prepared for this first day back to school for my kids differently this year, for many reasons, including:
-Buying school supplies, even if on sale, ahead of time has lead to a stockpile of unused stuff in our “supply closet”, bought in anticipation of the usual requirements. However, past experience has taught me each teacher wants a different organizational set up we won’t learn about until after the first day of school, and I’ll use what we have first.
-My kids are using iPads for their agenda books, taking notes during class, and doing a lot more of their work online. This translates into less need for notebook paper, agenda books, printer paper and ink- you name it. The digital revolution is working its way into schools, just like it has for offices, making the need for endless office supplies less and less over time. Instead, we may spend some money on some SAT prep apps or study apps for specific classes instead, but it will still radically reduce our overall office supply type back to school spending.
-With the rising cost of college, I don’t know any parent who is not being more cautious with every dollar at every level. I have a high school senior, and this year alone we will have to pay for the SAT’s, application fees, travel to visit colleges, and more, let alone look at how we are going to pay for college. This “bogeyman” of college expenses is keeping more of our general spending moderate and with a look towards long term value rather than short term pleasure.
-The recession makes everyone more cautious with discretionary spending. Buying your kid the cool pair of shoes or next new thing has become palpably less common than it was a few years ago. Values are shifting away from a more disposable mindset into long term value. I’ll buy my kids slightly “better” clothes, but less of them, with an eye towards durability, flexibility, and of course, whether or not it’s on sale.
I believe we’re going to have to change our mindset from an economy driven by consumer spending into an economy based on creating long term value and innovation. I think we’re slowly changing and evolving from a “I want it so I’m buying it” mindset to a “what kind of value is this going to deliver to me and how can I best use it” framework, where purchases are less impulse driven and more true need driven.
This, of course, makes the jobs of marketers and advertisers much more difficult. You have to match wants and needs much more carefully. There’s generally less discretionary spending, because people feel cautious about the overall economy and their ability to, long term, be able to save and afford the big stuff, like college and retirement. People turning over their cars every three years is being replaced with articles in Consumer Reports about how to make your car last 200,000 miles. I think the disposable economy is coming to a close, and is being replaced by people asking deeper questions about utility, durability, and values.
If this is true, then we’re going to have to radically shift our expectations of what our economy is, and how its evolving. But I think it’s becoming ever clear, at least to me, that mere consumer spending will not get us out of recession. Instead, it will be more long term investments in our futures – the ant versus the grasshopper mentality- that will make the change we need. It’s not going to be fast. Those promising quick returns are seen more and more as being deluded, as much as we all would love to hope for instant fame and riches.
We’re in a rebuilding phase. And no amount of pencils and notebooks in an age where more and more is happening digitally, is going to change the fact that there are permanent changes happening in the way we do things and where we invest time and money in the aggregate. Less and less of it is going to be predictable, media-generated and hyped buying, and instead, it will be more of a steady, more needs-based purchasing cycle. We already see this in Business to Business sales- why should we think consumer spending will be any different?
Back to School isn’t going to be a buying season for much longer- or at least not in the “office supply” sense. That’s almost a given. The question is how long will it take everyone to figure it out.