Cardlytics’ Back-to-School Trend Analysis Shows Impact of Omnichannel on Consumer Spend and Retention

Rhea-AI Summary

Cardlytics (NASDAQ: CDLX) released its annual back-to-school (BTS) trend analysis, highlighting consumer behavior shifts as inflation rises. The analysis found that omnichannel shopping boosts consumer spending, with multichannel shoppers spending over $1,000 compared to $900 for single-channel shoppers. However, overall spending showed only a 1.2% increase between 2020 and 2021 due to declining customer volume. Early 2022 insights reveal an 8.4% year-over-year spending decline as economic uncertainty prevails, suggesting consumers may focus on essentials and one-stop shopping.

Positive

• Consumers who shop across multiple channels spend more, indicating a potential for higher sales.
• Apparel saw a 24.3% year-over-year increase during the 2021 back-to-school season, driven by increased customer engagement.

Negative

• Overall spending increase was only 1.2%, indicating flat growth and potential challenges in customer volume.
• Early 2022 spending is down 8.4% YoY, reflecting economic uncertainty and reduced purchases.

Analysis offers insight from previous back-to-school seasons ahead of the second-largest shopping event of the year

ATLANTA, Aug. 01, 2022 (GLOBE NEWSWIRE) -- Cardlytics (NASDAQ: CDLX) released its annual back-to-school (BTS) trend analysis, which underscores the importance of providing consumers with an omnichannel shopping experience to maximize consumer loyalty. The analysis, which comes as 62 percent of consumers start their back-to-school shopping this month, examines previous BTS spending behaviors for a sense of what to expect during the 2022 BTS shopping season amid the backdrop of rising inflation.

Key Take Away
Notably, the analysis found that consumers who shop across channels (e.g., in-store, online, apps, etc.) spend more. In 2021, shoppers using just one channel spent an average of $900 during the back-to-school shopping season, but those who purchased items across multiple channels spent over $1,000. Even as customers spent more across both on and offline channels in 2022, in-store shopping remains the preferred method for most. It also shows that in-store sales are slowly returning to pre-COVID levels at 63 percent of total spend in 2021, compared to 61 percent in 2020, and 73 percent in 2019.

As shoppers gear up for the 2022 season, inflation may drive these figures higher due to spend per purchase, but that does not necessarily equate to increased purchases in any given category. Cardlytics’ Q1 2022 State of Spend report saw a slowdown in spending toward the end of Q1 as consumers made adjustments to accommodate increased costs in goods, food, gas, and housing brought on by the highest inflation seen since the 1980s. This could continue into the BTS and holiday 2022 seasons as customers focus on purchasing essentials and possibly engage in more one-stop shopping.

“Convincing your customers to convert on both online and offline channels is essential to maximizing incremental sales and customer loyalty,” said Nate Bucholz, Cardlytics’ vice president of DTC, Subscription, and Retail. “Our insights continue to show that people shopping across a brand’s available channels spend more than those who shop in only one channel. And they are more likely to return. Looking at your customer base through the lens of the channel they shop can help you get the most impact from your marketing spend. I would encourage brands to offer the best sales and cashback rewards now to acquire and retain customers as they head into the holidays, which is the last big shopping season of the year.”

Additional Trend Highlights
The back-to-school season is the second largest shopping event of the year behind the December holiday season, making up 15 percent of annual consumer spending. The analysis includes sales for apparel, home décor, office supplies, sporting goods, shoes, and mass merchandiser, finding that:  

• Overall spend was flat with only a 1.2 percent increase between 2020 and 2021. This is likely due to declines in customer volume and total purchases – defined as the number of actual customers making purchases in these categories. This trend may continue through the 2022 BTS season with minimal growth as customers tighten their wallets and only increase their spending in response to increased prices.
  
  
• Apparel had a strong 2021 back-to-school season as parents rushed to refresh wardrobes for in-person schooling. The data showed that spend increased by 24.3 percent year-over-year in this category, driven by strong customer and purchase growth. Spend increases in this category were due to genuine growth and are not a byproduct of current inflation. It is predicted that due to tightening economic conditions and the fact that people spent significantly more last year than the year before, it is likely that there will be a flat or negative spend growth for 2022.
  
  
• Shoes and children’s apparel saw significant increases as well last year. Shoes had a nearly 30 percent year-over-year increase while children’s apparel saw a 13.2 percent jump. But, shoe companies are bracing for weaker sales for the latter half of this year, which could impact overall growth for this category in 2022.
  
  
• Consumers cut back on home and office supplies in 2021, and this trend has a strong chance of continuing as more children return to classrooms in 2022. Home and office supply spending was down 8 and 8.8 percent, respectively, as fewer purchases were needed for homeschooling and to counterbalance heavy spending in previous years.
  
  
• Department stores also experienced greater sales with increases across volume of shoppers, number of purchases, and spend per purchase. Year-over-year spend went up by 22.4 percent. Spending in this category may also feel the impact of inflation, particularly when it comes to spend per purchase – while consumers may have less items in their cart, this may be offset by increased costs for each item.
  

The review covers an eight-week period beginning the second weekend of July and lasting through Labor Day. Early insights from the first two weeks of July 2022 show that spend is down 8.4 percent YoY as customers brace for economic uncertainty. This points to a decline in the number of customers and purchases resulting in a sluggish start this season across all categories. To view the full trend analysis, visit: https://www.cardlytics.com/blog/customer-loyalty-is-the-battleground-for-back-to-school/

About Cardlytics
Cardlytics (NASDAQ: CDLX) is a digital advertising platform. We partner with financial institutions to run their rewards programs that promote customer loyalty and deepen relationships. In turn, we have a secure view into where and when consumers are spending their money. We use these insights to help marketers identify, reach, and influence likely buyers at scale, as well as measure the true sales impact of marketing campaigns. Headquartered in Atlanta, Cardlytics has offices in London, New York, Los Angeles, San Francisco, Austin, Detroit and Visakhapatnam. Learn more at www.cardlytics.com.

Contact
Monica McDonald
Communications Manager - Cardlytics
Mmcdonald@cardlytics.com

FAQ

What insights did Cardlytics provide in their annual back-to-school trend analysis for 2022?

Cardlytics highlighted that consumers who shop across multiple channels spend more, but overall spending showed only a 1.2% increase compared to 2021.

How is inflation affecting back-to-school shopping behavior according to Cardlytics?

Inflation may lead to increased spending per purchase, but not necessarily more purchases, as consumers may focus on essentials.

What was the year-over-year spending trend for consumers in early 2022 as reported by Cardlytics?

Early insights from Cardlytics indicated an 8.4% decrease in spending in the first two weeks of July 2022 compared to the previous year.

What percentage of annual consumer spending does the back-to-school season represent according to Cardlytics?

The back-to-school season accounts for 15% of annual consumer spending, making it the second-largest shopping event behind the December holidays.

What categories experienced spending increases in the 2021 back-to-school season?

Apparel, shoes, and children's apparel saw significant spending increases, with apparel experiencing a 24.3% rise year-over-year.