Welcome to TimesPeople Get Started TimesPeople Lets You Share and Discover the Best of NYTimes.com 8:05 PM Recommend Get Home Delivery Log In Register Now HOME PAGETODAY'S PAPERVIDEOMOST POPULARTIMES TOPICS Search All NYTimes.com Business WORLD U.S. N.Y. / REGION BUSINESS TECHNOLOGY SCIENCE HEALTH SPORTS OPINION ARTS STYLE TRAVEL JOBS REAL ESTATE AUTOS Search Business Financial Tools More in Business » Global Business Markets Economy DealBook Media & Advertising Small Business Your Money Energy & Environment Retailers See Slowing Sales in Back-to-School Season G. Paul Burnett/The New York Times Shoppers at an Aéropostale in New Jersey. A survey showed that Aéropostale is a store on teenagers’ go-to lists this season. SIGN IN TO RECOMMEND SIGN IN TO E-MAIL PRINT REPRINTS SHARE By STEPHANIE ROSENBLOOM Published: August 14, 2009 Halfway through the back-to-school shopping season, retail professionals are predicting the worst performance for stores in more than a decade, yet another sign that consumers are clinging to every dollar. Related Times Topics: Shopping and the Retail Industry Fears about the job market have resulted in sluggish customer traffic over the last few weeks, spurring the gloomy sales projections. Parents who do shop are aggressively trading down, informing status-conscious teenagers that notebooks from the dollar store or shirts from Costco will have to do this year. Stock analysts at Citigroup are predicting a decline in back-to-school sales for the first time since they began tracking the figures in 1995. They estimate August and September sales at stores open for at least a year — known as same-store sales — will fall 3 to 4 percent, compared with an increase of nearly 1 percent in the same period last year. The National Retail Federation, an industry group, expects the average family with school-age children to spend nearly 8 percent less this year than last. And ShopperTrak, a research company, predicted customer traffic would be down 10 percent from a year ago. “This is going to be the worst back-to-school season in many, many years,” said Craig F. Johnson, president of Customer Growth Partners, a retailing consultant firm. Many analysts consider the season to begin in mid-July; sales numbers for that month are out already, and they were poor. Same-stores sales fell 5 percent compared with last year, according to the International Council of Shopping Centers, an industry group. Figures out this week from the government showed that overall retail sales in July were down 8.3 percent from the same month last year. Back-to-school sales in July were hurt because many states moved their sales tax holidays out of July and into August. This month, retail sales should get a lift from those tax holidays. Still, the council expects August same-store sales to decline 3.5 to 4 percent compared with last year. A report this week by IBISWorld, a research company, found that back-to-school spending would fall in nearly every category compared with last year: clothing, down 5.4 percent; footwear, down 4.4 percent; and electronics, down 1.8 percent. Sales of traditional school supplies like notebooks and pencils are expected to be about the same as last year. Retailers typically do some of their biggest business during the back-to-school shopping period, also considered to be an early predictor of the holiday shopping season. If the forecasts turn out to be right, this could be another tough holiday period. This year’s frugality may hark back to an earlier age, but consumers are using up-to-the-minute tools in their determination to save money. They are scouring the Internet for coupons. They are planning their shopping trips around e-mail alerts that tip them to bargains. One mother, Clarissa Nassar, signed up for alerts about sales on a Web site called Shop It To Me. When she saw that her daughter’s favorite brand, Baby Phat, was on sale at Macy’s, she promptly drove to the department store to shop for school clothes. “I got an alert for the cutest tie-dye pink top,” said Ms. Nassar, a mother of two, Mikayla, 7, and Joseph, 3, in Johnstown, N.Y. “Originally it was $36 and I got it for $9.75.” Executives at Google said Internet searches for back-to-school bargains had soared this year. Searches for coupons are up 40 percent over last year and searches for buy-one-get-one-free deals are up 30 percent. Dan Schock, head of Google’s East Coast retail team, which helps retailers advertise online, said the race to find free items and deals on the Web began earlier this year than last year. “They’re comparison shopping,” he said. That has spurred a digital-driven flight to low-price retailers. Google searches for the terms “Wal-Mart” and “school supplies” are up 160 percent compared with a year ago. And searches for Aéropostale, the value-priced teenage apparel chain, are up 50 percent year-over-year. Aéropostale and Wal-Mart, the discount chain, are among teenagers’ go-to stores this season, while more expensive stores — like Hollister and Abercrombie & Fitch — are not, according to a survey of students ages 12 to 17 by Majestic Research. “Rather than get one top at a Hollister, they can get two or three at Aéropostale,” said Brian J. Tunick, a retail analyst at J. P. Morgan Securities. Several back-to-school surveys found that shoppers plan to forgo name brands altogether. Staples, the office supply chain, is counting on that. The retailer not only lowered prices on 250 items on many back-to-school lists, it is also trying to win shoppers with Staples-brand school supplies, which typically cost less than national brands. “It gives us an advantage even over Wal-Mart in terms of sourcing low-cost product,” said Michael A. Miles Jr., president and chief operating officer of Staples. “This year with the economy being what it is, it’s all about value.” With parents putting their dollars toward the supplies on their children’s school lists rather than toward another pair of jeans, apparel and footwear sales are expected to suffer most this season, according to a study by the NPD Group, the retailing consultant firm. Indeed, Crayola’s president and chief executive, Mike Perry, said the company was not experiencing the same pain as other manufacturers. After all, school lists typically include crayons. “People are going to have to get the products that the kids need for school,” Mr. Perry said. Sales of consumer electronics, including computers, cellphones and calculators, are likely to fare better than many other categories this year. IBISWorld said that over the next several years, the sector was likely to become the No. 1 back-to-school spending category, overtaking clothing. Some retailers are already trying to cash in on the trend. Wal-Mart, for one, has been working with brands including Hewlett-Packard, Dell and Toshiba to widen its variety of computers and sell them at rock-bottom prices. On Sunday, Wal-Mart will begin selling a new selection of low-price laptops, including a 17-inch Toshiba model for $348. At Best Buy, college dorm accessories like microwaves and printers are on offer for less than $100. The electronics chain is also selling an exclusive line of laptops for college students. To attract customers, office supply stores are selling scissors and glue sticks for pennies, as they have in the past. And many stores have formed partnerships to offer consumers more savings. OfficeMax and Payless ShoeSource are offering discounts to each other’s customers. Retailers like Sears and J. C. Penney are trying to attract students with interactive Web sites about school fashion and dormitory décor. With consumers in such a penurious mood this year, retailers are learning that they can skip aggressive online marketing only at their peril. Joanne Fraembs, a mother of two in Wantagh, N.Y., put it: “I don’t go into stores that don’t send the e-mails.” Sign in to RecommendNext Article in Business (1 of 26) »A version of this article appeared in print on August 15, 2009, on page A1 of the New York edition. SIGN IN TO E-MAIL PRINT REPRINTS Times Reader 2.0: Welcome to the future. Your newspaper is here. Click here to try it free today. Ads by Google what's this? 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