Mastercard: Back-to-School U.S. Retail Sales Expected to Grow 5.5% Compared to Last Year

    As students wrap up the current school year, retailers – and parents – are already preparing for a robust back-to-school shopping season as more kids head back into the classroom.

    According to Mastercard SpendingPulse, which measures in-store and online retail sales across all forms of payment, U.S. retail sales are expected to grow 5.5% — excluding automotive and gas — during the critical July 15 through September 6 back-to-school period compared to 2020. Compared to 2019, sales are expected to grow 6.7%.

    “Back to school has always been a prime season for retailers,” said Steve Sadove, senior advisor for Mastercard and former CEO and Chairman of Saks Incorporated. “This year, the broader reopening brings an exciting wave of optimism as children prepare for another school year, and the grown-ups in their lives approach a similar ‘return to office’ scenario.

    “This back-to-school season will be defined by choice as online sales remain robust, brick and mortar browsing regains momentum and strong promotions help retailers compete for shoppers’ wallets,” he added.

    As the broader U.S. reopening occurs and consumers return to brick and mortar, anticipated e-commerce sales will ease slightly compared to last year (-6.6%) but will remain up a significant amount (+53.2%) when compared to 2019.

    In terms of what consumers are buying this back-to-school season, Mastercard anticipates the following retail trends:

    • Apparel Refresh: While athleisure was the fashion statement of 2020, this year brings the diversification of the wardrobe as in-person schooling, reunions and other events drive consumers to make their social debuts in style. Apparel is expected to grow 78.2% YOY / 11.3% YO2Y.
    • Department Store Shopping Returns: Department Stores, outdoor shopping centers and malls offer a fresh change of scenery for shoppers. Mastercard forecasts a 25.3% YOY / 9.5% YO2Y increase in the Department Store sector as they rebound from last year’s dip in foot traffic. Buy online, pick-up in store as well as technologies such as contactless will remain important as consumers continue to seek low-contact experiences.
    • Tech Upgrade: If we learned one thing this past year, it’s that technology keeps us connected. With many states and schools determining the virtual/in-person cadence, Mastercard anticipates electronics will be up 13.0% YOY / 9.6% YO2Y.

    Building on Ongoing Retail Momentum

    The anticipated back-to-school sales growth is a continuation of ongoing retail sales momentum, with May marking the eighth consecutive month of Total Retail Sales growth.

    According to Mastercard SpendingPulse, U.S. retail sales excluding automotive and gasoline, increased 12.2% year-over-year in May, and 10.2% compared to May 2019. Online sales in May grew 1.1% and 94.8% respectively, compared to the same periods.