Back-to-School Survey 2016 Shopping for
the “Easy A”

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View > Slide Master > Slide master1] Copyright © 2016 Deloitte Development LLC. All rights reserved. 2 Key Insights & Findings Deloitte’s 2016 Back-to-School Survey Shoppers are likely to spend more this year, with early shoppers spending most but budgets vary by category Most shoppers are heading to physical stores and their lists are largely predetermined Parents are using digital to do their research ahead of time; shopping is a surgical strike • Average total spend forecasted is $488 • 87% report that they are likely to spend the same or more than they did last year • While clothing and school supplies still dominate back-to-school lists, computer and gadget shoppers spend the most on tech • Those who start before August are likely to spend 26% more than those who start later • In-store still prevails over online for back-to-school season, except for purchases of technology • 2/3 of spending for traditional categories – clothing and school supplies – will occur in store • 67% say spending is more heavily influenced by the school’s recommended list than by their children • Nearly 1/3 will take advantage of pre-configured kits offered by the school or PTA • More than half will utilize smartphones during the shopping journey; almost 1/3 will use tablets • 61% will research online before purchasing products in the physical store • 25% plan to use social media, mostly for transactional information versus inspiration

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 3 Expect to spend more 32% Expect to spend less 13% Expect to spend the same 55% Parents cite need for more items, expensive items, and higher prices as the reasons behind their plan to spend more 87% of parents intend to spend the same or more compared to last year “How will your spending this year on Back-to-School items compare with what you spent last year?” Why do you plan to spend “more”? 1. Children need more items 2. Children need more expensive items 3. Prices are generally higher Why do you plan to spend “less”? Source: Deloitte in-house survey Note: Sample size (N) = 1200 Average Anticipated 2016 Back-to-School Spend: $488 81% say their financial situation is “better” or the “same” in 2016 1. Children need fewer items 2. Household has less money 3. Fewer children in grades K-12

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 4 School supplies, clothes/shoes, and backpacks top the list of products that parents plan to buy for their children 4% 6% 9% 10% 10% 12% 13% 78% 92% 95% Wearable technology Printer or other computer hardware Computer software/small accessories Cell phone/smart phone Tablet, e-reader Computer Jewelry/handbag/accessories Backpack/book bag/lunch box accessories Clothes/shoes School supplies Source: Deloitte in-house survey Note: Sample size (N) = 1200, multi select question * Shoppers who stated that they will buy at least one of the technology items “Please select the following product categories which you are planning to buy for your student.” 29%* plan to spend on technology products

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 5 While clothing and school supplies still dominate back-to-school lists, computer and gadget shoppers spend the most on tech Category spend planned for 2016 back-to-school season Source: Deloitte in-house survey Note: Sample size (N) = 1200; Spending on voice and mobile data plans is excluded Categories 93% plan to buy Clothing & Accessories Average spend $239 98% plan to buy School Supplies Average spend $122 19% plan to buy Computers & Hardware Average spend $456 20% plan to buy Electronic Gadgets Average spend $286

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 6 Spending breakdown by category Average spend (by category buyer) planned for 2016 back-to-school season Source: Deloitte in-house survey Note: Sample size (includes only respondents who will purchase the above mentioned category or item) $55 $81 $84 $228 $209 $210 $255 $149 $158 $546 Backpack/book bag/lunch box accessories School supplies Jewelry/handbag/accessories Clothes/shoes Wearable technology Cell phone/smart phone Tablet, e-reader Printer or other computer hardware Computer software/small accessories Computer Clothing & Accessories $239 $122 School Supplies Electronic Gadgets $286 Computers & Hardware $456 Categories Items

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 7 2/3 of school supply shoppers will buy in a store; more than 1/3 of computer and hardware shoppers will purchase online In-store still prevails for back-to-school season, but channel varies by category Avg. B2S spending by channel $106 Undecided* ? $109 Online $273 In-store *Undecided (In-store/Online) Source: Deloitte in-house survey Note: Sample size (N) = 1200 Average spending by channel $106 Undecided* ? $109 Online $273 In-store *Undecided (In-store/Online) 63%19% 18% Clothing & accessories School supplies Computers & hardware Electronic gadgets 40% 32% 28%35% 35% 30% 66% 14% 20% $239 $286$456 $122 Average consumer spending within category In-store Online Undecided (In-store/Online) n = 234n = 230 n = 1110 n = 1174

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 8 Most popular back-to-school items are usually purchased in a brick-and-mortar store “Please select the following product categories which you are planning to buy for your student.” Source: Deloitte in-house survey Note: Sample size (N) = 1200, multi select question 27% 33% 33% 35% 39% 42% 48% 57% 59% 64% 71% 38% 36% 40% 43% 34% 29% 22% 20% 20% 19% 11% 34% 31% 26% 22% 27% 29% 30% 23% 21% 18% 18% Tablet, e-reader Computer – desktop/laptop/notebook Wearable technology Voice and data phone plans (monthly) Computer software/small accessories Printer or other computer hardware Jewelry/handbag/accessories Backpack/book bag/lunch box accessories Cell phone/smartphone Clothes/shoes School supplies: Paper, pencils, books, etc. In-store Online Undecided (In-store/Online)

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 9 Shoppers that start early expect to spend more than those who wait Source: Deloitte in-house survey Note: Sample size (N) = 1200 “When are you likely to begin your Back-to-School shopping?” July 0% September OctoberAugustEarlier than July 7% EarlyinJuly 18% LaterinJuly 33% EarlyinAugust 34% LaterinAugust 8% 1% 58% will begin shopping before August $692 $619 $457 $430 $394 $404 Average Spend Shoppers who start before August are likely to spend 26% more than late starters

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 10 Spending on computers & hardware peak earlier in the season, whereas clothing peaks late Source: Deloitte in-house survey Percentage represents the spend distribution (across categories) for the given time period Spending across categories by timing of back-to-school season 37% 40% 48% 47% 56% 44% 26% 21% 15% 15% 17% 14%15% 16% 8% 11% 4% 22% 21% 22% 28% 25% 22% 19% Earlier than July Early in July Later in July Early in August Late in August September Clothing and Accessory Computers and related Electronic Gadgets School Items/Supplies

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 11 Back-to-school shopping is highly influenced by school recommendations 67% 65% 36% 31% My shopping is influenced more by the school's recommended products than my child's requests I plan to shop at different points throughout the summer to take advantage of deals The shopping season is less important to my family because we replenish school supplies throughout the year I’m buying fewer traditional school supplies because my child is using more digital technologies “Please indicate your level of agreement with the following statements (% who agree or somewhat agree)” Source: Deloitte in-house survey Note: Sample size (N) = 1200 Plan to take advantage of pre- configured “kits” of school supplies offered by child’s school or PTA 32% # Pre-configured school kits

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 12 Devices play a role in the shopping journey, but people click more for information than to buy Smartphones are used more often than tablets 51% 55% 56% 61% 64% Compare products to similar products Access a mobile shopping app Get/download discounts, coupons, sale information Get price information Access a retailer's website Source: Deloitte in-house survey Note: Among shoppers who own a smartphone (n = 1148) or a tablet (n = 985); multi select question 30% 53% 53% 54% 61% 71% Compare products to similar products Make a purchase Shop online Get price information Access a retailer's website 53% Mobile Tablet

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 13 Social media usage will increase, but will remain transactional “Do you plan to use social media sites to assist in your Back-to-School shopping?*” 13% 16% 16% 30% 44% 45% 64% 74% To watch a retail/product video To post to or view virtual image boards To post comments, reviews or feedback To visit retailers' pages on social networking sites To read reviews/recommendations To browse products To receive a coupon To view promotions/ads “With regard to your Back-to-School shopping, how do you plan to use social media sites? #” Source: Deloitte in-house survey Notes: *Sample size (N) = 1200 #Multi select question (n = 302) Most will use social to find promotions, receive coupons, and browse products 25%

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 14 Shoppers do their research before going to the store and also look for perks when shopping online 63% 61% 42% 40% 30% Purchase from online retailers who offer free shipping Research online before purchasing products in the physical store When shopping online, I prefer loyalty programs that provide faster or cheaper shipping than product discounts Prefer to purchase from retailers offering BOPUS* or buy online/return to store I will shop in stores less this season because BOPUS option is more convenient 2016 “Please indicate your level of agreement with the following statements (% who agree or somewhat agree)” Source: Deloitte in-house survey Note: Sample size (N) = 1200; *BOPUS = buy online/pick-up in-store

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 15 Discount and traditional department stores will remain the most preferred back-to-school shopping destinations in 2016 “In what types of retail environments do you plan to do your back-to-school shopping?” Source: Deloitte in-house survey Note: Sample size (N) = 1200, multi select question 2% 6% 10% 10% 11% 12% 15% 19% 21% 24% 25% 35% 37% 42% 54% 57% Home furnishings and housewares stores Catalogs Home electronics stores Off-price stores Bookstores Drug stores Consignment shops/thrift stores Fast fashion apparel retailers Supermarkets Warehouse membership clubs Specialty clothing stores Online sites Dollar stores Office supply/technology stores Traditional department stores Discount/value department stores

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 16 Payment type varies by household income 60% 53% 49% 7% 5% Debit Card Credit Card Cash/Check Gift Card Digital payment “Which of the following payment methods will you likely use for your back-to-school purchases?” Source: Deloitte in-house survey Note: Sample size (N) = 1200; multi select question 48% 53% 68% 58% 58% 47% 42% 41% 56% 7% 5% 8% 2% 4% 7% Boomers GenXers Millennials 64% 71% 68% 57% 28% 32% 44% 57% 61% 72% 65% 61% 41% 43% 38% 9% 6% 9% 5% 7% 6% 5% 5% 4% 6% <$25,000 $25,000 - $49,999 $50,000 - $74,999 $75,000 – 99,999 $100,000+ Debit card Credit card Cash/check Gift card Digital payment Overall Generation Household income Digital payment penetration remains low

2016 Back-to-School SurveyCopyright © 2016
Deloitte LLP. All rights reserved. 17 About the survey The survey was commissioned by Deloitte and conducted online by an independent research company between June 22 – 27, 2016. The survey polled a sample of 1,200 parents of school-aged children and has a margin of error for the entire sample of plus or minus three percentage points. All respondents had at least one child attending school in grades K – 12 this fall. As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.