Total college market spending will grow to $405 billion this year, up 5% from $385 billion last year, details a study released in September by re:fuel. That growth will be fueled by a 40% year-over-year jump in discretionary spending, from $86 billion last year to $120 billion this year. Although some of that is based on increased enrollment of about 600,000 students, the average annual discretionary spend per student has increased by almost 37%, from $4,069 in 2011 to $5,559 this year. The figures are calculated on the basis of spending per month per student, extrapolated to the entire population for 12 months. All amounts are in 2012 dollars.
It appears that college market discretionary spending will come at the expense of non-discretionary spending (tuition/room and board, rent/mortgage, and class materials), which dropped from a total of $299 billion last year to $285 billion this year.
Food to Get Large Portion of Discretionary Dollars
Breaking down total college market discretionary spend among various categories, the study finds that $44 billion will go to food, far ahead of other categories such as automotive ($17.6 billion) and clothing and shoes ($12.9 billion – up 126%). An NRF study released in July found that three-quarters of back-to-college shoppers were planning to buy apparel and accessories, spending an average of $132.97, and 71% (the highest in the survey’s history) expected to buy new shoes, spending an average of $75.81.
Meanwhile, the re:fuel study finds that cellphone and smartphones ($9.8 billion) and entertainment ($9.1 billion) will also see large chunks of spend. Items further down the list are seeing rapid growth, though: discretionary spending on technology is up 227% to $8.5 billion; personal care product spend is up 105% to $7.8 billion; and cosmetics spend is up 280% to $5.7 billion.
1 in 3 Spending More on Groceries
Further details from re:fuel’s “College Explorer ’12” indicate that 32% of students surveyed have increased their spending on groceries since last year, up from 29% who indicated an increase in 2011. Roughly one-quarter have upped their spending on eating out, unchanged from last year. Many have also increased spending on entertainment (22% vs. 11% in 2011), technology/electronics (21% vs. 12%), personal care products (19% vs. 9%), going out (15% vs. 13%), and personal care services (15% vs. 6%).
About the Data: The re:fuel survey was conducted online between March 21 and April 23, 2012. A total of 1,528 college students between the ages of 18-34 responded, and the sample was nationally representative across all college segments. The survey was executed by Crux Research Inc.