“The defined block of time when that back-to-school spending traditionally occurred has faded, now spread across three waves of shopping and multiple shopping seasons,” according to Marshal Cohen, chief retail industry advisor for Circana.

Recent findings from Circana found that traditional retail seasons are being transformed by shifting consumer sentiments, carrying with it implications about the future of the food industry.

The report evaluated the back-to-school season, finding that, although spending this year is following a similar pattern to 2023, it comes up short compared to last year’s performance. During the four weeks ending August 31, total U.S. retail sales revenue across the discretionary general merchandise and CPG dropped 1% when compared to the same four weeks last year, while unit demand remained stagnant.

Year-over-year comparisons uncover a shift in retail food and beverage performance: the category experienced a sales revenue of 2% lower than last year, and, once again, unit sales remained flat.

“Consumers are buying the same amount of product, but they’re spending less, and that spending is aligned with current needs,” Cohen said.

Staying Home for the Holidays?

Consumer behavior dispersing the back-to-school shopping season across a longer period may also mean that this year’s holiday shopping may face similar consequences.

A report from Reuters found that U.S. retailers are looking to hire fewer seasonal workers this upcoming holiday season compared to last year, citing tighter consumer spending. Bureau of Labor Statistics data found that only 520,000 new jobs are expected to be added this year compared to 564,200 in 2023.

“One possibility is…that retailers will not have the need for so many workers, particularly if the economy cools faster and consumers decide to shop less this holiday,” according to a report by Challenger, Gray & Christmas provided to the news source.

Deloitte corroborates this concern in a recent report regarding holiday spending forecasts. The consulting service anticipates sales to increase between 2.3% and 3.3% across the holiday season, compared to 2023’s 4.3% holiday sales growth.

Hope for Manufacturers

While school necessities were among the categories that rose to the top of the shopping list during the back-to-school shopping season, Circana found that innovation was a common thread across all of the fastest-growing discretionary general merchandise categories in August, marking an opportunity for manufacturers entering the holiday season.

“Consumers may be waiting for the weather to shift to buy what they need for changing temperatures, but with the right product or product message, marketers still can inspire desire-based purchases,” said Cohen.

“Growth opportunities lie in wait for marketers prepared to grab them at a new time, or with a new approach, diminishing the role of traditional shopping seasons and indicators. Lackluster back-to-school spending no longer signals soft holiday spending to follow; instead, there may be lingering benefits of pent-up demand.”

The Food Institute Podcast

Restaurant results for the second quarter weren’t stellar, but people still need to eat. Are they turning to their refrigerators, or are restaurants still on the menu for consumers? Circana Senior Vice President David Portalatin joined The Food Institute Podcast to discuss the makeup of the current restaurant customer amid a rising trend of home-centricity.