Retailers' back-to-school sales meant back to basics in supplies

Drug Store News,  Oct 7, 2002  by Liz Parks

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When Wal-Mart's same-store sales were up less than 4 percent in August, knew it was going to be a tough back-to-school season.

But the question in the midst of the BTS season was how tough, and if some retailers were able to buck the trend and have a good season, how did they do it?

Having sales--lots of them--that started early and ran right through the middle of September seemed to be a strategy that worked well for some drug chains.

In California, Ed Dallal, chief executive officer of the 22-unit Big A Drug Stores chain, reported that BTS sales have been "better than last year" and attributed the sales gains to getting ads out in early August and running a new sale two times a month.

"You have to have sales," he said. "Our sales start the first week in August. Mothers come in, and they stock up for their kids. The big sellers are the basics: notebooks, school supplies, rulers, filler pad, which we advertised three for $1. People are looking for value."

At CVS, spokesman Mike DeAngelis also reported that people were shopping for "staple items, notebooks, pens, paper."

For the first time this year, CVS used a community service marketing program tied into the chain's customer loyalty program, ExtraCare, to help drive back-to-school sales. "Instead of our customers getting coupons back for them to redeem themselves," said DeAngelis, "we created a program that would let our customers and their children help their teachers."

Through the Classroom Bucks program, families purchasing $35 in back-to-school supplies using the CVS ExtraCare card earned $5 in Classroom Bucks for their teachers to use.

The program was CVS' way of helping parents and students pay back teachers who buy school supplies out of their own pockets.

According to a 2000 study by the National Education Association, the average teacher spends about $408 out-of-pocket for school supplies.

Helena Foulkes, senior vice president of advertising and marketing for CVS, called Classroom Bucks "a winwin for parents and teachers."

The promotion began Sept. 5 and ran through Sept. 14, the weeks that DeAngelis said can help make or break the BTS season. "Based on the redemptions we've gotten through our ExtraCare program, we expect Classroom Bucks to be very well received," he said while the promotion was in full swing.

In Seattle, Bartell Drug ran a similar community service program to collect donations of school supplies for needy kids, Calling the program Schooltools for Kids, Bartell gave shoppers the opportunity in July and August to buy single items or complete school kits that they could donate. Pepsi and World Vision, a large charitable organization that has a major presence in the Seattle marketplace, partnered with the drug chain in the program.

John Weith, Bartell's vice president of merchandising, said shoppers either could buy the supplies and place them in receptacles within Bartell stores, or they could take them to a World Vision warehouse nearby. Teachers from the Puget Sound area were encouraged to pick up any school supplies needed for students not able to afford them.

Although Weith said it was too early to evaluate the success of the program, he noted that early sales in July and August indicated that Bartell's back-to-school sales are going to be ahead of last year.

In addition to its regular sales featuring back-to-school values, Bartell Drug also ran a promotion giving students a chance to win computers in a sweepstakes through a joint sponsorship between the chain and Kudos, an M&M/Mars brand.

During the height of the BTS season, Weith said: "Back-to school has been going pretty well for us. We tried to start our sales a little earlier this year, in mid-July. We're also ... in-stock so customers can continue to come back ... even after the kids start school."

Karen Ramos, a spokeswoman for Albertson's drug division, said that back-to-school sales in Albertson's Osco and Sav-on drug stores have been "slower than Vast years due to the economy.

To help drive sales, Ramos said Albertson's created large cardboard point-of-sale displays listing the school supplies required at all the local schools in the communities their drug stores service. They also included a broader assortment of value-priced back-to-school corporate brand items in their circulars and off-shelf display program.

Said Ramos, "Our corporate brands offer customers looking for lower price points an added value."

Like other retailers found, Ramos said that BTS shoppers this year were focused on buying the basics. "People were impulsively picking up new items like gel pens, she said, "but for the most part, they were buying the things from the school lists, the things they needed to have."

In Newark, Del., Jon Rudden, vice president of merchandising for Happy Harry's, reported doing a good business during back-to-school.

"The basics certainly did well, but we also saw strong sales of pre-formed stretchable book covers," he noted.