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- Back-To-School Spend | Loyalty 2.0 | The Rise of “Nonessential” Essentials
Back-To-School Spend | Loyalty 2.0 | The Rise of “Nonessential” Essentials
Back-to-school is now America’s second-largest consumer event, with K-12 spending reaching $39.4B this year.
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Good morning, ! This week we’re exploring the consumer back to school season, personalization as the new loyalty currency, and the industry of the nonessential, becoming essential.
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DATA DIVE
School Is in Session (for Wallets)
Back-to-school isn’t just a shopping trip—it’s America’s second-largest consumer event after the holidays. In 2025, K-12 spending alone hits $39.4B, with per-student outlay at $858. Families are prioritizing apparel (43%) and tech (26%), making this season as much about Chromebooks as crayons. Nearly two-thirds of parents (64%) shop early, lured by promotions that feel “too good to pass up.” Gen Z parents are also sneaking AI into the cart—67% using gen AI tools to hunt deals, though only 22% actually trust them. The takeaway? Back-to-school is less “pencils and paper” and more a barometer of consumer confidence heading into Q4.
TREND OF THE WEEK
Beauty as a “Need”
For Gen Z (27%) and Millennials (26%), skincare and beauty products aren’t luxuries—they’re essentials. Compare that to Gen X (18%) and Boomers (22%), and you see a generational reset in what counts as a “must-have.” Even as 45% of U.S. adults cut back on nonessentials amid tariffs and inflation, beauty spending is proving resilient: consumers are nearly twice as likely to drop dining out (43%) than personal care (24%). For brands, this shift means one thing: beauty has graduated from “nice-to-have” to “budget-protected self-care.” Expect loyalty plays, affordable indulgence positioning, and value-driven messaging to matter more than ever. (More)
PRESENTED BY LEVANTA
Get Featured by Publishers Driving Holiday Amazon Sales
This holiday season, top publishers are hand-selecting Amazon brands for gift guides, newsletters, reviews, and more — sending high-intent shoppers directly to storefronts.
Levanta is partnering with these publishers to connect them with a select group of 7–9 figure brands ready to scale.
ECOMMERCE
VC Bets Shift Downstream: Postpurchase Is the New Power Segment
In Q2 2025, Postpurchase solutions pulled in a staggering $914.5B in VC funding—more than any other e-commerce segment. This marks a clear investor pivot toward logistics, returns, fulfillment, and loyalty infrastructure, as commerce matures from acquisition to retention.
By contrast, Prepurchase tools—like discovery engines and product recommendation platforms—garnered just $146.1B, the lowest of all categories. Investors are clearly less enamored with top-of-funnel tools, preferring areas with clearer ROI and cost-saving leverage.
Other standouts:
Horizontal Platforms (e.g., marketplaces, operating systems): $781.0B
Purchase Venue (e.g., storefronts, D2C platforms): $766.2B
Purchase Medium (e.g., mobile, voice, AR): $685.7B
Why it matters: In a capital-efficient environment, VC is flowing toward the messy, margin-critical part of the funnel. For founders, selling "boring" infrastructure may be more fundable than flashy front-end tools. For strategics, it’s a sign that the competitive moat is shifting from who gets the customer to who keeps them.
DEAL OF THE WEEK
Keurig Dr Pepper Brews $18B Global Coffee Play
Keurig Dr Pepper is acquiring Amsterdam-based JDE Peet’s—the parent of Peet’s Coffee, L’OR, Jacobs, and Douwe Egberts—in a $18 billion deal that will reshape the global caffeine landscape.
The post-merger plan? Break the company in two. One entity will become a pure-play coffee powerhouse with $16B in revenue, led by KDP CFO Sudhanshu Priyadarshi and headquartered in Burlington, MA and Amsterdam. The other will house the beverage portfolio—Dr Pepper, Canada Dry, 7Up, and energy drinks—generating $11B in sales, led by current CEO Tim Cofer.
This isn't just a bold M&A move—it's a structural bet on category specialization. Coffee is going global and premium; soda is facing shifting tastes and regulatory headwinds. Unbundling lets each unit pursue targeted growth strategies, unlock valuation, and compete more aggressively—particularly against Nestlé, Coca-Cola, and PepsiCo.
Why it matters: A play this big signals strategic conviction in the value of focus—and highlights coffee's status as a top-tier growth engine for consumer portfolios. Expect more carve-outs, especially where scale and category divergence meet. (More)
TOGETHER WITH PACASO
How 433 Investors Unlocked 400X Return Potential
Institutional investors back startups to unlock outsized returns. Regular investors have to wait. But not anymore. Thanks to regulatory updates, some companies are doing things differently.
Take Revolut. In 2016, 433 regular people invested an average of $2,730. Today? They got a 400X buyout offer from the company, as Revolut’s valuation increased 89,900% in the same timeframe.
Founded by a former Zillow exec, Pacaso’s co-ownership tech reshapes the $1.3T vacation home market. They’ve earned $110M+ in gross profit to date, including 41% YoY growth in 2024 alone. They even reserved the Nasdaq ticker PCSO.
The same institutional investors behind Uber, Venmo, and eBay backed Pacaso. And you can join them. But not for long. Pacaso’s investment opportunity ends September 18.
Paid advertisement for Pacaso’s Regulation A offering. Read the offering circular at invest.pacaso.com. Reserving a ticker symbol is not a guarantee that the company will go public. Listing on the NASDAQ is subject to approvals.
Points, Perks, and Parsley: The Loyalty Economy at Checkout
US consumers are treating gift cards like the Swiss Army knives of spending: versatile, reliable, and everywhere. According to COMARCH, the most common loyalty points are earned while shopping for groceries (43%)—and that’s also where they get spent (34%). Online shopping isn’t far behind, with 19% earning and 16% redeeming points. Cafés and restaurants see modest activity (earning 13%, spending 16%)—still more loyal than hotels or airline travel, which barely register.
Meanwhile, the overall US gift card market is booming, projected to hit $234B in 2025—a 7.9% increase—driven largely by digital gift card demand and innovation in corporate and loyalty integrations.
Takeaway? Gift cards are bleeding-edge boring—and that’s precisely what makes them brilliant. Their power lies in everyday convenience and flexible redemption, whether as savvy shopper tools or incentive linchpins for brands. (More)
CONSUMER BEHAVIOR
Personalization: The New Loyalty Currency
Consumers don’t just want their name on an email—they expect brands to know what they want before they do. According to the data, 70% of respondents want personalized offers, outpacing the global average. But here’s the catch: hyper-personalization without trust is dead on arrival. Shoppers know their data is the price of admission and aren’t handing it over lightly. This is where AI-powered platforms like Comarch’s step in, crunching massive datasets while promising data protection. JetBlue’s VP of Loyalty Promotion nailed it: the challenge is giving customers more without making them feel stalked. Translation: personalization works when it feels like a concierge, not a hall monitor.
The takeaway: loyalty programs aren’t about birthday coupons anymore—they’re about real-time adaptation. The winners will be brands that deliver customization without creeping out their customers. (More)
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