A Strong Case for a Market Comeback

Second quarter sales beat forecast by +70%.

Aug 3, 2021

By Bob Stimolo

Results from the second quarter survey of school marketers reveals a dramatic improvement overall.  In the first quarter, the Q2 sales forecast was +17% and the FY2021 forecast was +15%.  At the end of the second quarter, the Q2 sales actual was +29% and the FY2021 forecast improved to +22%.  The second quarter actual was a whopping 70% better than forecast and the FY2021 forecast improved by just shy of +50%.  These sales results make a strong case for a market comeback.

American Rescue Plan Anticipated to Improve Sales

Survey respondents said that the improvement in sales was the result of the reopening of schools (71%), the overall economy (47%), and the change in school funding levels (42%).  Almost 90% of respondents anticipate an improvement in sales as a result of the $122 billion American Rescue Plan Elementary and Secondary Emergency Relief legislation.

Promo and Ad Budgets Increasing +40%

In response to current economic conditions, almost 30% of respondents are increasing their promotion and advertising budgets by an average of almost 40%.  Almost 80% of respondents anticipate an improvement in economic conditions before the end of this calendar year.

Direct Mail More Effective Than Email

After sales reps, direct mail has regained the lead as the second most effective advertising and promotion media over email by 5 percentage points.  Two-thirds of respondents have, or are taking steps to align or develop their products to accommodate remote and hybrid learning.  Almost 40% of respondents expect to see a major improvement in sales by this coming fall.  Almost three quarters of respondents expect the Biden administration will cause their education sales to improve.

Ed Focus on Helping Students Catch Up

FutureEd is an independent think tank at Georgetown University's McCourt School of Public Policy. They are studying state plans for spending American Rescue Plan funds.  According to FutureEd, “State plans often gave insight into other initiatives like accessing high-quality curriculum, creating a welcoming and engaging school climate, implementing high-dosage tutoring, and improving data capacity by implementing early warning systems and other strategies.”  It would appear that there will be a considerable increase in demand for those products that help students “catch up” from falling behind during the pandemic.  Learn more at future-ed.org.

Prep Now for a Winter Comeback

Purchasing decisions are already being made with respect to spending American Rescue Plan funds.  The coming winter season should be exceptionally strong with sales stretching from early January all the way through to the following fall.  The majority of product lines should experience a return to or exceed pre-pandemic sales levels in 2022.

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