Back to School
What opportunities does the online ‘Back to school’ market offer?
The Internet not only offers more choice to consumers but it also allows retailers to open up a niche market. So what opportunities does the current ‘back to school’ period bring? This area is well served by brick and mortar retailers but it also has a strong dependency on delivery and quality and is one of the most significant retail peaks outside of Christmas. If you think we’re just talking about school shorts and blazers, think again!
The average child in the UK will be sent back to school with a new coat, shoes, stationary, school bag, games kit as well as standard uniform. My current list for back to school with two children staying in their current schools included at least 12 new items each. This includes visits to sports stores, WH Smiths for new stationery and a desperate search for extra small grown up tights for my daughter who has now achieved this desirable stage of seniority. It’s also included a visit to the school uniform shop, along with the inevitable trip back for things out of stock or not quite right. For working parents, it’s not easy to fit this in with the extra holiday pressure of child care.
So can the online retailer take advantage of this back to school period and profitably entice consumers away from the stores? Or is the pull of the store and increasing price wars over standard uniform items and stationary too compelling?
We think it depends on clear segmentation and targeting, selecting the right products and ensuring the supply chain and delivery mechanisms scale. Clearly, it makes no sense for a niche online retailer to enter into a price war with ASDA and Tesco over school shorts. However, quality, availability and brand do play a part in this market. Many parents have preconceived ideas about the quality of a specific brand or wonderful new developments such as non-iron shirts. Any mother who has searched the racks in the supermarket for the correct size will know that the ability to order online from the website, if it’s not in stock in store, is hugely comforting as the August bank holiday looms. Nobody wants to send their kid back to school in last year’s too short trousers.
For the niche players, segmentation and targeting can reap rewards. The average parent heads to the High St for pencil cases, trainers and school bags. However, there is also a higher margin market for a differentiated online offering, as shown by the success of companies such as the Great Little Trading Company. Web-savvy, brand aware teenagers buy their own stationary and have a heavy influence on purchases of sports clothing, coats and shoes. Will they buy online? A number of parents will happily hand over this type of purchase in return for an afternoon away from the shops even if it’s still their credit card that pays the bill. Also, with greater availability of pre-paid cards for teenagers, it will be interesting to see how online retailers begin to target this important group of decision makers using online communities and blogs.
Whilst basic school clothing can now be bought during your weekly food shop; there is another sector of the market with the more specialist higher value uniform or sports kit that lends itself to online. The market for these is usually the time-poor, more well off parents who are only too happy to pay a £4.95 delivery charge. With over 12 million new parents now going straight back to work, time and convenience really is of the essence, and online retailers can do well here, if they get the operational basics right.
One of our customers, http://www.schoolblazer.com is an online retailer of bespoke school uniforms for some of the UK’s top independent schools. Parents purchase their child’s uniform online from wherever they are in the world, and at any time of year. The uniform is delivered direct to their door with their child’s nametags already sewn in and any alterations already completed This has addressed a significant problem in the school uniform market, where uniforms traditionally only become available just before the beginning of term and are only sold in school–based shops or high street department stores.
However, this market is not all paved with gold. So what are the critical success factors? This market is incredibly peaked and relies on good availability and reliable delivery. This means careful attention to internal processes and scalability. As smaller, niche companies open up their services online, their business processes often need to be dramatically up-scaled to cope with growth. This may mean updating the IT infrastructure to ensure tight stock control and management.
As the business grows, the disciplines in the website have to be robust enough not to corrupt the database. When something is ordered, the stock database has to be updated on a much larger scale than before, so that consumers know what is in stock and how long it would take to order in their products. IT security is also essential to manage security settings on a large scale. Again, the disciplines in any website for this market need to be robust enough to cope with the demands of parents, safely and securely. Also with high demand at peak times, the delivery processes need to be sharpened in order to ensure these very critical deliveries do not disappoint. Finally, get out there and sell your service. Use all the tools available to promote to your chosen market.
To learn about how i-Realise (formerly Itim Consulting) can help your team scale your business call Chris Collins on 07831 826668
